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A. Stotz All Weather Strategies – February 2025

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The All Weather Strategy is available in Thailand through FINNOMENA. If you’re interested in our allocation strategy, you can also join the Become a Better Investor Community. Please note that this post is not investment advice and should not be seen as recommendations. Also, remember that backtested or past performance is not a reliable indicator of future performance.

What happened in world markets in February 2025

Performance of the World stock markets

  • Tech-heavy NASDAQ dropped big while the overall market was flat
  • Japan dropped as well
  • Hong Kong saw a massive jump, China A-shares were mixed
  • Europe had a strong month

Find the updated Performance of the World stock markets here.

World Equity fell in February

  • The strategy has a core target allocation of 20%
  • Trump’s tariffs and Ukraine peace talks brought uncertainty to the markets, which led to a fall in stock prices

Global Bonds was strong in February

  • The strategy has a core allocation to Global Bonds; the current target allocation is at 45%
  • Weak stocks and rate cut expectations in the EU supported performance in February 2025

Commodities fell in February

  • We had no allocation to Commodities

WTI oil closed February at US$71/bbl versus US$73/bbl in January

Only metals were up in February 2025

  • Trump’s tariffs brought volatility and uncertainty to Commodities as well

Gold gained 2.3% in February 2025

  • We had a 10% target allocation to Gold
  • Gold closed the month at US$2,857/oz t
  • Increased geopolitical uncertainty led to a further price increase

All currencies have weakened against Gold 2025YTD

  • Typically, a stronger US$ means a lower Gold price in US$ and vice versa

On Feb 2nd, Trump imposed 25% tariffs on imports from Canada and Mexico

  • And raised the tariff on Chinese imports by 10%
  • He says he’s doing it to reduce inflow of fentanyl (dangerous narcotic) and illegal immigrants
  • He does NOT say he does it to harm trade or protect US companies

One day later, Mexico agrees to send 10,000 soldiers to the US-Mexico border

  • Trump got what he wanted, and tariffs were paused
  • You can also say he’s looking forward to “achieve a ‘deal,’” which further highlights Trump’s interest in making deals, and making them quick

Two days later, Canada announces a plan to stop fentanyl coming to the US

  • Trump got what he wanted, and tariffs were paused
  • In just 2 days, it appears Trump achieved what he wanted with Mexico and Canada

Trump threatens EU with tariffs, too

  • President Trump says the US will impose 25% tariffs on autos and other things from the EU
  • Maybe to push his Russia-Ukraine peace deal?

It took a turn a month later

  • The White House imposed 25% across-the-board tariffs on Mexican imports and on nearly all Canadian imports on March 4

And may turn back quickly again

  • It certainly brings a lot of uncertainty and volatility

Higher US inflation expectations

Stagflation fears are rising

Japanese yields are shooting up

Nations are buying gold at a record pace

Performance review: All Weather Inflation Guard

All Weather Inflation Guard gained 0.7%

Since inception, the strategy was up 9.7% and 8.1% above a 40/60 portfolio

  • The strategy has also experienced less volatility

In February 2025, the strategy was up 0.7%, which was 0.1% above the 40/60 portfolio

  • Our 10% allocation to Gold and Global Bonds core allocation did great
  • TIPS, Financials, and Money Market all outperformed World Equity
  • World Info. Tech. underperformed

The strategy has added 0.6% value compared to a 40/60 portfolio 2025YTD

  • The strategy beat a 40/60 portfolio by 1.0% in 2024

Performance review: All Weather Strategy

All Weather Strategy gained 0.8%

Since inception, the strategy was up 50.0% and 19.8% above a 60/40 portfolio

In February 2025, the strategy was up 0.8%, which was 0.5% above the 60/40 portfolio

  • Our 25% allocations to Gold and China equity did well
  • Our 5% allocations to Developed Europe and Commodities helped too
  • Our 25% allocation to US equity underperformed

The strategy has added 0.5% value compared to a 60/40 portfolio 2025YTD

  • The strategy beat a 60/40 portfolio by 7.0% in 2024
  • The strategy has had a higher risk-adjusted return in all periods

Performance review: All Weather Alpha Focus

All Weather Alpha Focus gained 0.3%

Since inception, the strategy was up 5.4% and 7.6% above a 60/40 portfolio

And 2.4% below World Equity, but with a lot less volatility

In February 2025, the strategy was up 0.3%, which was 0.1% above the 60/40 portfolio

  • Our big tilt to Precious Metals Miners did great
  • Our big tilt to Info. Tech. did OK, while the Asia Pacific ex Japan underperformed

The strategy has added 2.3% value compared to a 60/40 portfolio 2025YTD

  • The strategy beat a 60/40 portfolio by 3.5% in 2024

DISCLAIMER: This content is for information purposes only. It is not intended to be investment advice. Readers should not consider statements made by the author(s) as formal recommendations and should consult their financial advisor before making any investment decisions. While the information provided is believed to be accurate, it may include errors or inaccuracies. The author(s) cannot be held liable for any actions taken as a result of reading this article.

Posted in All Weather Strategy