July 15 / Trade Alert For The Sigma Portfolio (Live)
Execution Date: July 15, 2025 - Market Close
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With markets reaching extended levels once more, it’s time to rebalance our portfolio so that positions align with risk and reward levels which make sense and allow for continued gains, with limited downside.
First of all, I would like to note that our core asset allocation strategy (Enterprise) maintains a risk-on overweight position in equities (70% vs 60% in the benchmark). As such, there is no need to become defensive in our overall stance.
However, we have already written extensively about a market rotation that is ongoing. Factors like the iShares Russell 2000 ETF (IWM) and Mid-Caps (MDY) have been outperforming recently, catching a bid in various sectors.
Speculative assets have also been booming lately. Take a look at the melt-up in crypto:
These trends are set to continue and flows are most likely to come out of mega caps, including names which have done remarkably well as of late (semiconductor and AI related stocks like KLAC, LRCX, NVDA). Profit taking in these names would not be surprising.
There are also quality opportunities which have limited fundamental downside. Take LLY for example, a Millennium Alpha top 10 pick, trading at risk-reward lows:
Our rebalancing session today will attempt to pick up on these emerging trends, weeding out stocks which have underperformed, taking profits from winners and initiating positions which have strong near term momentum or limited downside potential.
We will execute the following trades at the close in the Sigma Portfolio:
Sells
SELL 8 NVDA (Reduce position by -22.22%)
SELL 26 TLT (Reduce position by -6.86%)
SELL 108 HALO (Closed Position)
SELL 8 APP (Reduce position by -50.0%)
SELL 43 EAT (Closed Position)
SELL 1 KLAC (Reduce position by -14.29%)
SELL 91 FTDR (Closed Position)
SELL 16 VRSK (Closed Position)
SELL 45 LRCX (Closed Position)
SELL 20 CTAS (Closed Position)
Buys
BUY 3 MCO (Add 1.3% to position)
BUY 7 LLY (Initiate 4.82% position)
BUY 48 BBIO (Initiate 1.97% position)
BUY 78 AAOI (Initiate 1.98% position)
BUY 11 SITM (Initiate 1.95% position)
BUY 19 IESC (Initiate 5.0% position)
BUY 35 HLI (Initiate 5.87% position)
BUY 29 BR (Initiate 5.89% position)
BUY 10 EME (Initiate 4.8% position)
We are also adjusting stop loss and profit targets in accordance with technical and fundamental conditions. The summer months are typically volatile, so we wouldn’t want to get caught offsides in regards to our downside risk.