Performance Report: 08/31/2026
All performance data for our strategies is net of all fees and expenses. All performance data for indexes or other securities is from sources we believe to be reliable. All data is as of 08/31/2026
Investment Strategy
MAP - Full ($500k+)
MAP - Plus
MAP - Balanced
S&P 500 Index2
Mod Alloc(AOM)2
Growth Alloc (AOR)2
Jun Return
5.1%
4.2%
1.7%
2.6%
1.3%
1.8%
YTD
13.5%
7.5%
5.8%
12.3%
5.7%
8.6%
Inception1
124.8%
N/A
N/A
161.1%
56.3%
82.4%
Sortino3
1.24
N/A
N/A
0.87
0.57
0.72
(Disclosure: We added performance figures for our new strategies solely on a month-to-month and YTD basis as any prior data will be inconsistent and potentially misleading. We will post continuous data for our full-size MAP Strategy since its inception on 5/1/2019. We use AOM and AOR as our benchmarks as they are low-cost index funds that model the exposure of the majority of retail investors. Our risk measures are aligned closely with these funds. It is important to note that individual account performance varies and your account may perform better or worse than its model. The model's performance is simply the average performance of all accounts participating in the model.)
Performance Update
Our Core MAP Strategy nearly lapped the S&P 500 (SPX) in the month of August. Our Sortino ratio ticked up 6 points. The data shows it was a great month. The Core MAP Strategy has bested its benchmark, the iShares 60/40 ETF (AOR), by over 4%/year with a near-identical risk profile. In last month's update, I wrote:
I'm confident in how we are positioned going forward. In fact, I'm oddly optimistic about our growth prospects for the next couple of years. I think the stock market has handed us an incredible gift by discounting some themes that should outperform for a considerable period of time.
When I wrote that, I didn't realize the turnaround would start so quickly. Two of the themes I addressed in July saw sizeable gains in August. Precious metals and their mining counterparts leaped over the proverbial "wall of worry". Fertilizer stocks finally broke above their bullish "Head and Shoulders" patterns, further contributing to our gains. While the War with Iran continued without resolution, energy stocks contributed to our gains, serving as the ideal way to diversify equity market risk. Drone stocks were a mixed bag while Uranium and Rare Earth stocks dragged on performance.
If you'll indulge me for a minute, I am going to nerd out because our performance in August was quite unique. While the SPX was profitable, our correlation to it was negligible. The correlation coefficient between the SPX and our Core strategy was merely 0.233. This means about 1/4 of our gains can be attributed to equity market risk while the other 3/4ths were a result of Alpha. Thus in August, our equity market risk was rather small even though our performance was quite large. (Alpha is the term used to explain how much value a manager adds above and beyond the benchmark the strategy tracks. The Sortino ratio is my favored measure of alpha but the Sharpe ratio is more commonly used.)
Between 2019 and January of 2026, US equity markets acted as an incredibly homogenous ecosystem. Almost everything went up or down together. During this time, the more "beta" or volatility you stuffed into a portfolio, the better you did when the market went up and the worse you did when the market went down. There was not a lot of alpha to be had. During this time, I created a bit of alpha by using stop-losses when equity markets crashed. I simply tried to get in when the going was good and get out when the going was not so good. It worked often enough to make a difference.
But that all came to an abrupt halt in February of this year. All of a sudden, true-to-life correlations returned to the market. Seemingly natural relationships that previously existed across securities came back to the forefront. For example, rising oil prices resulted in higher interest rates, which led to lower stock prices. This is how markets behaved for generations prior to the advent of QE in 2011. But with QE, a rising tide lifted all ships. Everything would go up until there was a shock, and then, "BOOM", everything crashed. As of February, those old tried-and-true correlations came back with a vengeance.
It took me a while to adjust to the "new norm", and once I adjusted, I overadjusted. It was a painful for a time. I tweaked the MAP system to better thrive in the new/old environment. Obviously, it's far too early to claim success, but the initial results are very positive. There is one more iteration of the MAP system I need to complete which should improve its performance even more.
Moving Forward
While the new and improved MAP proved its merits in August, I remain overly cautious about maintaining too much equity market risk. I have worked tirelessly to find low-priced stocks that we can buy with minimal risk. And I've spent considerable time studying correlations to make sure we aren't overexposed to any specific geopolitical events. But as the market proved in Q2, strange and odd things can take place. As I've addressed in past updates, the stock market is egregiously expensive as market participants have assumed the FED can fight off any and all possible economic ills. If the consensus ends up being wrong, which happens every so often, I reserve the right to get real defensive, real quick.
Until then, I've "cast a wider net" which has resulted in more positions but a smaller allocation to each position. As a result, I have reduced our single-stock risk considerably. I have also reduced our sector risk. I foresee maintaining exposure for some time to the same themes I addressed last month, assuming I do not see a liquidity trap developing. And I plan on rotating between my favored themes on a fairly consistent basis to take advantage of new low-risk signals provided by the MAP system. After all, no one ever went broke taking profits!
As always, please don't hesitate to call us at 512-553-5151 if we can be of any assistance.
Best,
Matt McCracken
1) Inception date of 4/30/2019
2) All benchmark prices and returns are obtained through IBKR's PortfolioAnalyst reporting tool. S&P 500 Index is calculated using the index price. AOM is the iShares Core 40/60 Moderate Allocation ETF. AOR is the iShares Core 60/40 Balanced Allocation ETF. These benchmarks were chosen as they represent the prevailing investment strategies of retail advisors.
3) The Sortino ratio is a commonly used measure of "alpha" or the value a manager adds to a portfolio. It is similar to the Sharpe ratio. The Sortino ratio does emphasize the negative impact of downside volatility more than the Sharpe ratio which is why we use it as our primary measure of alpha.