November 6, 2025
We introduced our Elev8 model in June of 2024 and have been running it in its current form since August 28, 2024. Each month we review the previous month’s positioning and performance to identify what worked and what needs improvement. A brief description of the Elev8 model and its inputs follows the review as an appendix.
This month was a small setback for the Model’s performance as the portfolio underperformed in October 2025 posting an excess return of -24bps vs. our simulated S&P 500 benchmark.
Elev8 Model Indicator Dashboard & Positions (October 2025)
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
Performance Recap: Elev8 Performance vs. Benchmark (October 2025)
Performance Recap: Elev8 Performance vs. Benchmark (August 29, 2024 – October 31, 2025)
What Worked in October
Our biggest bet on the long side of the portfolio hit home as the Elev8 model went overweight the VGT by 610bps relative to the S&P 500 Technology Sector weight. The Tech sector outperformed by approximately 430bps (XLK vs. S&P 500) in October. The Model also had us out of the Materials Sector which was the worst performing sector in October (XLB -653bps vs. S&P 500) and Staples which underperformed (XLP -487bps vs. S&P 500) as well.
What didn’t work in October
The portfolio suffered on the short side as we were out of the Healthcare Sector with a resultant bet of -881bps. Healthcare was the best performing low vol. Sector in October (+135bps vs. S&P 500) while our longs in Utilities and Real Estate underperformed. We had stronger model scores for historically offensive exposures in XLF, XLC and XLI which led to long positions. Each of those sectors underperformed. We had expected the combination of strong risk appetite and a dovish Fed to catalyze bets on a consumer recovery, but investors continued to buy Tech and did some bottom-fishing in Healthcare.
October Inputs & Positioning
Our model starts November rolling over our long position in the Technology Sector (VGT) and bar-belling that high beta exposure with longs in Healtccare (XLV), Utilities (XLU), Industrials (XLI) and Real Estate (VNQ). We’re out of the Energy and Materials Sectors and we remain out of the Staples Sector as well while we have tactical shorts on Financials (XLF), Discretionary (XLY), and Comm. Services (XLC) Sectors.
Elev8 Model Input Dashboard: November
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
Elev8 Model Positions: November
Attribution provided by ETFAction, https://www.etfaction.com/
Other data provided by FactSet Research Systems Inc.
Appendix: What is the Elev8 Model
Elev8 Model
Elev8 is a sector rotation model that seeks to outperform the S&P 500 on a yearly basis by actively managing sector exposures relative to our simulated S&P 500 benchmark. The model seeks to generate alpha over its benchmark by allocating 100% of the portfolio to 8 of the 11 GICS Sectors comprising the S&P 500. It picks the 8 sectors that have the strongest scores in the model’s up to 14 inputs while having no exposure to 3 of the GICS Sectors that have the weakest scores in the model each month. The model can be above or below benchmark weight in the sectors it does have positions in.
Elev8 Model Inputs
- 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 at the sector and industry level
- Overbought/Oversold oscillator studies
