The Strategy returned +0.95% this week, a good result in its own right. Measured against the Strategy’s full history back to November 2000, a week this strong lands at the 77.8th percentile, roughly the top fifth of all 1,340 complete trading weeks on record. This is an absolute return strategy: its job is to grow money measured against zero, not to chase any index week to week.
The comparisons still matter, just as a second read. The week also left the Strategy well ahead of the broader market and every benchmark I track: SPY lost -0.59%, and the Strategy beat it by about 1.5 percentage points on a log basis. It also finished ahead of the synthetic equal-weight EW-Hold benchmark (+0.09%), the investable EQL ETF (-0.04%), and the balanced 60/40 VBIAX (-0.67%). Against VBIAX specifically, this week’s margin of 1.6 percentage points sits at the 95.8th percentile of those same 1,340 weeks, a genuinely rare gap. That gap says more about VBIAX’s bond sleeve offering no cushion this week than it does about anything unusual in the Strategy’s own return.
Market timing did the bulk of the work, adding 0.85 percentage points. Consumer Discretionary (XLY) and Communication Services (XLC), the two sectors parked in cash, sat out a week in which they would have lost 5.22% and 3.93% respectively fully invested, while the cash sleeves collected interest. Equal-weighting added a further 0.68 points, since the average sector outperformed the cap-weighted index. Energy (XLE, +3.36%) and Utilities (XLU, +2.48%) led the held sectors; Financials (XLF, +0.09%) and Consumer Staples (XLP, -1.24%) lagged.
No sector flipped state this week. The Strategy stayed nine sectors invested and two in cash, XLY and XLC, throughout. Both cash sectors remain below their 200-day average, XLY at a ratio of 0.934 and XLC at 0.928, so neither re-entered, and no signal changed at Friday’s close. There is no pending trade for the next session.
A single week never proves much, and the top-fifth result stands on its own regardless of what any benchmark did alongside it. That is the case for running an absolute return strategy: the scoreboard that matters most is the Strategy’s own history, with the week’s crowd of comparisons a distant second.
John