April 2023 Portfolio Review

April turned out to be a thoroughly nondescript, boring, and lackluster month…kinda nice, wasn’t it? All portfolios around the breakeven point after withdrawals. Winner: the Capital Efficient Butterfly (+.79%); loser: the Levered Seasons (-.69%). RPC Stability up .01%, and still first overall.

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Comp Prev. Mnthly Inflation,Classic 60/40,Golden Butterfly,All Seasons,RPC Stability,RPC Income,Bogleheads 80/20,Qian,Levered Butterfly,Cap Eff Butterfly,100% Equities,RPC Growth,Levered Seasons4/30/2023,0.416666,0.41%,-0.35%,0.22%,0.01%,-0.22%,0.67%,-0.20%,-0.31%,0.79%,0.77%,-0.11%,-0.69%Mont…

There have been a lot of intense months over the past two years tracking the portfolios, but this one might be memorable for just how little happened. Six winner portfolios and six loser portfolios, and all within about 1.5% of each other. We also got close to something that I have been wondering would ever happen: we almost had a portfolio completely flat after accounting for the withdrawal of monthly expenses. That was the RPC Stability, which certainly lived up to its name.

What was the reason for the flatness? Not sure, but inflation seems to be dropping quite a bit. It was calculated at 5% over the previous twelve months, which contrasts to 8.5% at this same point last year (looking back over the twelve months before that). Podcasts I listen to and Twitter tell me there is still lots of worry about an impending recession and market pull-back, but so far, no real evidence it has arrived. Maybe soon, maybe not… I remain unable to predict the future.

Assets that did well this month were UPRO, which was up 3.6% on the strength of a modest but positive month for the S&P 500, and then international equities, with VXUS up 1.88% and DFAX up 1.73%. Assets that struggled were small-cap value equities (VIOV down 2.35%) and then levered small-caps (TNA down 6.86%). Bonds were slightly positive for the month, and in the alts space, managed futures and gold were both up almost 1% and commodities down a smidge.

The Capital Efficient Butterfly won the month, beating out the 100% equities by two basis points (.79 to .77). It was nice to see this new portfolio take the top spot so soon after its birth, as it makes me think there may be something here. Portfolios with 3X Leveraged funds have been a bit of a wild ride, so I’ve been curious to see how a portfolio using a different approach to leverage can work. Three months in, it is beating out the Levered Butterfly. They both had the exact amount at the start of February, and the CE Butterfly is up about 26,000 since then. Part of the Levered Butterfly’s disappointing April can be explained by its exposure to small-cap equities, though, so the difference in performance really isn’t just about the type of leverage.

For the month, traditional portfolios finished second-, third- and fourth-best for the month, in a very good showing, though the All Seasons portfolio was pretty good. Portfolios with exposure to small cap value got dragged down a bit, and again, the high exposure to TNA explains the poor performance of the Levered Seasons and the Levered Butterfly. Still, a feather in the cap of traditional portfolios, for sure.

Monthly Results:

April 2023 Performance

Cumulative Results:

Asset Performance: