A simple, rules-based three-path strategy: (1) if bond momentum is strong, buy SHY; (2) else if levered-tech momentum is very weak, buy TECL; (3) otherwise buy a blue-chip stock basket. Always keep cash as a cushion and rebalance only when allocations drift beyond a 0.21 corridor.

What RSI means for this strategy: RSI (Relative Strength Index) is a momentum gauge that measures how quickly prices have moved up or down recently. A 10-day RSI is a short-term view. Values run 0–100; above ~70 suggests recent strong up-moves (potentially overbought); below ~30 suggests recent declines (potentially oversold). In this strategy, RSI is used in a relative way, comparing SHY or TECL against SPY (the broad market) to judge momentum vs. the market. How the decisions flow, step by step: - Step 1: Look at SHY (short-term Treasuries) versus SPY using a 10-day RSI. If the RSI reads above 69 (bond momentum is very strong relative to the market), place the portfolio in SHY (bond exposure) via the first branch of the decision tree. This provides ballast when bonds look strong. - Step 2: If SHY’s momentum isn’t strong enough (RSI <= 69), look at TECL (a 3x leveraged tech ETF). Using the same 10-day window and the SPY benchmark, if TECL’s momentum is weak (RSI below 27), tilt into TECL (high-risk tech exposure) as a contrarian/momentum tilt. - Step 3: If TECL isn’t in the weak zone (RSI >= 27), switch to a basket of blue-chip stocks: Walmart (WMT), McDonald’s (MCD), Home Depot (HD), Procter & Gamble (PG), Pfizer (PFE), Johnson & Johnson (JNJ), Kraft Heinz (KHC), and Tesla (TSLA). This provides a diversified set of large-cap names often associated with stability or growth, depending on market conditions. - Cash buffer: The strategy uses a cash-equal approach, meaning a cash position is kept alongside the chosen exposure to cushion volatility and provide liquidity for rebalancing or new entries. - Rebalancing: There is a corridor width setting (0.21) that governs how far allocations are allowed to drift before rebalancing. The explicit rebalance rule is listed as none, so rebalancing is only triggered when weights move beyond the corridor rather than on a calendar day. - What you end up owning: Depending on which branch fires, you either own SHY (bond exposure), TECL (levered tech exposure), or the eight-stock basket. In all cases you hold some cash as well. The design prioritizes defensive exposure in one regime and opportunistic growth exposure in the other two regimes. - What this means for a layperson: The strategy tries to be simple and rules-based. It moves between safer bonds, aggressive tech exposure, and a diversified set of big-name stocks, all while keeping some cash on the sidelines. It does not rely on fancy fundamentals; it relies on short-term momentum signals to switch exposures. It’s important to note levered ETFs like TECL can magnify gains and losses, and the stock basket includes TSLA, which can be volatile. If you’re thinking about real money, you’d want to backtest these rules across different market regimes and understand how often you’d turn over positions and how much cash you’d hold during transitions.

Out-of-sample return: 33.5% vs 22.2% for the S&P, with far smaller drawdown (9.9% vs 18.8%) and Calmar ~3.40. A cash-buffered, rules-based strategy that shifts among bonds, levered tech, or blue-chip stocks to grow while protecting capital.