Why we’re shifting to utilities and consumer staples

The Island Light Sector rotation portfolio was updated at the beginning of September as part of our regular rebalancing process.   

Given recent and expected future market volatility, we reduced allocations from cyclical to defensive sectors.

We expect that the utilities and consumer staples sectors will benefit from lowered expectations of a Federal Reserve interest rate increase and reduced materials costs for domestic utilities.

consumer staples                                                              


For the month, we reduced allocations to financials and consumer discretionary items and retained positions in technology and healthcare.  

We have no current allocation to the energy, materials and industrials sectors.


The following table reflects the performance of our strategy, the S&P and the 9 sector ETFs that comprise our investment universe, through August 31, 2015:

Source: Island Light Capital

Photo Credit: Stefano Mortellaro via Flickr Creative Commons