VTS Defensive Rotation Strategy +22.64% in April - Performance Calculation Tutorial

VTS Community,

Calculating investing performance isn't really something many people do.  Now I'm sure there's a very small percentage of the population that breaks out the spreadsheets and does, but for the most part it's just investing professionals that bother with this.  And to be honest even then I would guess about 90% of asset managers don't even calculate a track record, and they certainly don't show it.  I wish they would, it's one of my pet peeves in the financial industry, but it is what it is.

So just know that you don't actually have to do this, but occasionally I get asked so I'll show you how it's done.  It's really quite easy, but let's go through it.

* Given that the VTS Defensive Rotation Strategy was pretty exciting in April 2026 being up 22.64% for the month, I'll demonstrate with that  :)

1)  There's actually a full video showing this in your Total Portfolio Solution course, so you can click here to watch that if you prefer

2)  Performance is tracked from live fill prices.  I'm just trading all the daily signals live in our public TOS account that we use in livestreams and all the performance is calculated based on those live fill prices.  Now the reason I send the email out around 11:00 am is to give people plenty of time to execute their own trades throughout the rest of the day.  Some people may do it right away, others may be busy with life stuff and will get to it later.  Whatever time of day is convenient for you is fine, we're all subject to the randomness of intraday pricing but it should average out in the long-run.

Step 1)  Every month for me starts with marking the closing price from the previous month in whatever position we hold through that day.  So for example, if we were holding SVXY, QLD, and SPY in all 3 strategies on the last day of the month, I would just mark the closing values and use those same positions to start the next month.  

• In this case the Defensive Rotation Strategy was in Cash on March 31st so we just start from scratch

Step 2)  I just go through all the live trades for that month for each strategy using a $25,000 model portfolio.  I want the performance to reflect most accurately what a subscriber would actually get in the real world.

• Since the Defensive Rotation Strategy is 1/3 of the portfolio, I use 1/3 of the $25,000 model portfolio which is about $8,333 for each entry.
• If there's a dividend in anything we're holding, I add that to the eventual sale price.  In April 2026 there were no dividends.
• For the first 10 years of VTS I used to deduct trade fees, but these days fees for ETFs are basically zero so in the last few years I stopped deducting those pennies.  I still factor trade fees for all Options Trading through as that is still a thing.

April 1st:  Buy XLU @ $45.86

April 7th:  Sell XLU @ $46.40 and move to Cash

April 8th:  Buy XLU @ $46.51

April 10th:  Sell XLU @ $47.39 and move into QLD

April 10th:  Buy QLD @ $68.13

Step 3)  When I've accounted for all the trades, now I just mark the price in whatever position we were holding at the end of the month and use that to officially calculate performance.

• QLD closed on April 30th @ $81.05

Step 4)  I'll show how it would manually be calculated, but I just do it in a spreadsheet.

Start with $10,000

1st XLU trade  ($46.40  -  $45.86)  /  $45.86  =  1.18%

2nd XLU trade  ($47.39  -  $46.51)  /  $46.51  =  1.89%

1st QLD trade  ($81.05  -  $68.13)  /  $68.13  =  18.96%

$10,000  *  1.18%  =  $10,118

$10,118  *  1.89%  =  $10,309

$10,309  *  18.96%  =  $12,264  =  22.64%

Step 5)  Life is much easier with spreadsheets

I realize that probably 99% of retail investors don't bother so again, you don't have to do this.  For clarity though I do like to break it down for newer VTS subscribers who perhaps haven't seen it yet.

VTS Defensive Rotation Strategy is still crushing it, and as long as the market goes up there will be opportunity to extend the success.

* Of course when this house of cards finally collapses and the global economy goes in the gutter, the Defensive Rotation Strategy will be spending most of that crash period in Cash. 

That is after all the whole point of Tactical Rotation investing through Volatility Targeting.  Participate in most of the upside, and hopefully sidestep most of the downside...