A monthly, ETF-based diversification strategy that buys an asset if its short-term price trend (about 1 month) is above its longer-term trend (about 10 months) and otherwise holds cash via a short-term Treasuries ETF. It spreads across five asset classes for balanced exposure.

What happens step by step: - You’re considering five asset classes via ETFs: SPY (US stocks), EFA (international stocks), IEF (US bonds), DBC (commodities), VNQ (real estate). SHV is used for cash when signals are negative. - Every month, for each asset, calculate two moving averages of price: a 20-day average (short-term) and a 200-day average (long-term). - If the 20-day average is higher than the 200-day average, you hold that asset for that month (the uptrend signal). - If not, you hold SHV for that asset instead (a cash-like position). - Within a month, weights are intended to be equal across the categories that are invested; if an asset is not invested, cash substitutes are used. - Rebalance once per month, updating which assets are held based on the latest moving-average signals. What the user actually experiences: - A diversified mix that reacts to broad market trends rather than chasing short-term price moves. - When markets rise and the uptrend signals occur, you gain exposure to the chosen ETFs; when signals fail, you tilt toward short-term Treasuries (cash proxy). - The approach emphasizes risk management through diversification and trend-based entries/exits rather than constant trading.

Diversified 5-asset trend strategy with a cash proxy. OOS max drawdown 8.9% vs SPY 22.1%, Sharpe ~0.80 vs ~0.82, annualized return 5.57% vs 14.01%. Lower drawdowns with disciplined, risk-adjusted uptrend participation.