Nick Hodge,
Publisher
March 10, 2026
I haven’t made any major moves in my portfolios since the latest battle in the Forever War broke out.
A proactively well-constructed portfolio doesn’t need to react.
Headed into February, it was clear that growth and inflation were slowing.
When the February issue of Foundational Profits came out on the 13th, I told members:
The economy is still expanding, but at a slower rate. And inflation is still abating, but also at a slower rate.
So while stock market bullishness remains, there is rotation afoot, with Information Technology and Communication Services negative for the year as of February 12th. We are now being led, thanks partially to a frigid East Coast winter and ongoing international geopolitical upheaval and uncertainty, by Energy and Materials, with a traditionally defensive Consumer Staple also in the top three.
The breakout in oil is now clear to see in early January. West Texas Intermediate (WTI) put in a bottom between $55 and $57 per barrel during the October to December timeframe, and has since added $10 per barrel to trade at $65.
So before mid-February, we had identified stock market rotation and pointed out new leading sectors.
This isn’t guessing or garrulousness. I didn’t waffle or hedge.
Because my products are centered around what I’m doing with my own capital, those macro observations came with specific investment actions.
In that same issue, I advised selling three ETFs that we had been holding:
- SPDR Consumer Discretionary ETF (NYSE: XLY)
- SPDR Technology Sector ETF (NYSE: XLK)
- SPDR S&P Capital Markets (NYSE: KCE)
And I advised buying the ALPS CoreCommodity Natural Resources ETF (NASDAQ: CCNR), noting it:
…seeks to gain exposure to equity securities of companies that own, explore or develop natural resources or to companies that produce or supply goods, equipment or services principally to natural resources producers. It is 38.5% weighted to Energy, 35.66% to Materials, 10.74% to Consumer Staples, 7.7% to Utilities, and 4.5% to Industrials. It currently yields 2.88%. It is not top-heavy, with its largest holding only accounting for 1.56% of the fund. Using it to get longer of Energy.
We rotated out of consumer discretionary, tech, and banks — profitably — and got longer of energy in the first half of February.
Bombs didn’t fall on Tehran until February 28th.
Good portfolio construction to both front-run and withstand a blast.
With Foundational Profits, I tell you how much I own of each position every month. Here’s a freebie, the allocation table from before we made those moves in February:
That table will look different when the new issue comes out this Friday, March 13th.
Not only have we shedded the three aforementioned ETFs and added the natural resource ETF, we have gotten bigger in other positions for which we had limit orders set to take advantage of any major market moves like we’ve seen over the past week.
Foundational Profits isn’t about chasing stocks or trends, or reacting to volatile market and political happenings. It’s about building a portfolio that survives chaos and compounds through it.
I’m not going to give you this month’s allocations for free.
But I will tell you that our weighted portfolio is up nearly 9% on the year versus an S&P that is slightly negative.
That is peace of mind and market outperformance for $249 per year. (You can join here.)
Is your advisor giving you that kind of foresight, rotation, and performance in exchange for 1% of your portfolio?
Or is he just rotating your hard-earned capital into his account via that fee?
Call it like you see it,
Nick Hodge
Publisher, Bizarro World