Current Stock Sector Weightings on the S&P, Secular Trends Portfolio
Posted on | June 30, 2009 Time: 4:53 am |
This morning there’s going to be some big changes to the Secular Trends Portfolio; as stated earlier there’s far too much cash sitting around. There are several themes that deserve representation, and a few sectors where the level of underweight (compared to the S&P 500) is more than I care to hang my hat on.
The doc below is a little spreadsheet where I’ve highlighted the current sector weightings of the broad S&P as well as the model portfolio. The top level is just a frame of reference; it shows the current estimates for operating earnings across the S&P 500 for 2009, as well as the historical results from ‘08.
Going forward, I’d like to get the individual divisors for each sector so that we can all get a better look at how each sector actually contributes to the S&P’s operating earnings. I believe the race to get a good bead on this will determine who feels confident about end of the year index targets, and who’s just whizzing into the wind:
Notes from the .xls
The Secular Trends Model is extremely underweight the consumer, which long-time readers will know to be a calculated move. I’ve been sitting half slack-jawed at the amazing run seen in the discretionary names ever since March, and the recent mini-rally continues to baffle me. But some puzzles are best left unsolved…
Healthcare’s underweight (about 4% depending on how you count it) is a little less intentional, with room open after the sale of Schering (SGP) and potentially more as I continue to evaluate the merits of holding onto Pfizer (PFE) anymore. I want to add a diagnostics company and a device company to flesh out this section of the portfolio.
And on the consumer side, there are a few stocks in the mold of a staples/disc. blend that look good on the basis of operating margins, cash flow, and valuation. We might see an addition there too in the coming 48 hours.
EpiphanyOne
Tags: Consumer Stocks > Investing > S&P 500 > sector weightings > Stock Diversification > Technology Stocks
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