Sector Ratings and Model Portfolio Update

The Grindstone Intelligence Sector Outlook is based on our top-down technical approach. These ratings reflect our views over the coming month.

We’re maintaining our Underweight ratings on Energy and Utilities, and keeping our Overweight ratings on Information Technology and Industrials. We acknowledge the high risk sector rotation in the weeks ahead, but believe those rallies will most likely be short-lived mean reversions.

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The Grindstone US Equity Model Portfolio is a hypothetical allocation designed to align with our Sector Outlook and seeks to outperform the S&P 500 Index over the long-term. Our positions are chosen with investment horizons ranging from a few weeks to several months. The Model will invest only in exchange-traded funds that track sectors, industries, or categories of stocks. No individual stocks or cash positions will be used in the Grindstone US Equity Model Portfolio. Changes to the model will be communicated via email to subscribers, and official ‘trades’ will be executed at the next closing price. Fund performance will cause portfolio weights to drift between updates.

We’re making only modest changes to the model portfolio, including de-risking our overweight position in Tech after last month’s rally. The changes will be effective at the closing print on June 2. The table below details the adjustments and the new positioning.

Please reach out with any questions. We’re happy to clarify any of our opinions, but the nature of our publication prevents us from providing personalized advice. For those questions, please contact a financial advisor.

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