ELEV8 Model Input Scores: May 2026
The table below shows the ELEV8 model’s scores for May. April’s big developments revolved around a sharp rotation back into AI infrastructure exposures with a heavy concentration of Technology Sector buying. The S&P 500 pivoted sharply from corrective price action to a bullish reversal that took the index to fresh all-time highs. The pivot triggered a short-covering signal for the portfolio during the month where the model covered its underweight positions in the Technology, Discretionary, Financials sectors. With April’s developments the macro picture has changed. Equities have re-established an uptrend while commodities, interest rates and USD spent the month in consolidation.
Key: Pattern = L/T (1yr+) Price Pattern of the Sector ETF, Mean Rating = simple average of 1-6 ratings (buyàsell) of all stocks within the sector, WTD Mean Rating = Cap Weighted Sector Constituent rating, OB = Overbought, OS = Oversold, N=Neutral
Model Input Commentary
The sector performance profile narrowed significantly in April with the Technology sector the only outperformer during the month. We think continued blockage of the Strait of Hormuz is a tailwind to the Energy trade while it persists. Materials stocks are near-term oversold after mean-reversion. We think the bid for hard assets will re-emerge. At the same time, elevated commodities prices from the start of the year are likely to keep rates on the higher side if economic activity stays steady.
ELEV8 Sector Rotation Model Portfolio: May Positioning vs. Benchmark Simulated S&P 500 (data as of 4/28/2026)
Previous Positioning as of last monthly Rebalance: March 30, 2026
As we mentioned in the lead, the Elev8 model was forced to cover its shorts on April 22, 2026. After starting the month positioned for a continued energy supply shock, the model went long traditional upside exposures in Technology, Financials and Discretionary due to the S&P 500 trading to an all-time high on improving breadth.
Performance vs. S&P 500 Simulated BMK, April 2026
Elev8 went into April positioned for continued defensive rotation. Timing was an issue as ceasefire news broke two days after we locked in our monthly allocations. The nature of the reversal caught us by surprise as Energy sector stocks retraced YTD gains sharply. Given the steepness of the decline, we were expecting a more drawn-out corrective process, but AI strength and investor risk appetite combined to take equities into a V-shaped recovery forcing us to cover. The model was off 570 bps in April as we spent a majority of the month wrong-footed despite our short covering rebalance on April 22.
Conclusion
AI enthusiasm re-inserted itself confirming the Technology led bull market trend for US equities. Geopolitics continues to be ignored by the market as a bearish factor. AI FOMO has been more powerful than potential inflation concerns or a struggling consumer. The Elev8 model starts May rel-aligned with the dominant trends in AI infrastructure and positioned for a rebound in commodities prices with the US/Iran peace process dragging out.
About ELEV8
We introduced the ELEV8 Sector Rotation Model in May of 2024. Here’s a look under the hood at the inputs we use to score the 11 GICS Sectors and our resulting positions. The model includes up to 14 indicators that range from:
- Stock Level Technical Characteristics
- Macro-overlays:
- equity trend (S&P 500)
- interest rate trend (10yr US Treasury Yield)
- commodities trend (Bloomberg Commodities Index)
- USD trend (vs. EUR & Broad Currency Indices)
- Relative performance vs. the benchmark S&P 500
- Overbought/Oversold oscillator studies
We use the largest passive sector-based ETF by AUM ($) for each sector as our proxy for ELEV8 sector positions. We select 3 out of 11 Sectors each month and have no exposure to the 8 sectors with the lowest scores in our model.
Data from Factset Research Systems Inc.
