Sector rotation: the three strongest US sectors
The US market splits into eleven sectors. Hold the three that have risen most over the last six months.
The rule
Rank the sector funds by their six-month return. Hold the top three in equal parts. Repeat every month.
Why people use it
Sectors lead for long stretches: technology in one decade, energy in another. Momentum tries to stay with the current leaders without guessing the next ones.
Where it hurts
When leadership rotates fast, the rule buys yesterday's winners at the top. It has no exit to cash: in a broad fall it holds the three sectors that are falling least.
How our bot runs it
Eleven SPDR sector funds: XLK, XLF, XLE, XLV, XLI, XLY, XLP, XLU, XLB, XLRE, XLC. Top three by 126-day return, a third each, reviewed on the first trading day of each month.
Live account
A virtual $100,000 account that follows this rule. Every trade is on the bot's page.
| Bot | Account | Return |
|---|---|---|
| Top three US sectors | $99,876 | −0.12% |