Blue-Chip Momentum

Ranking all allowed mega-caps by 6-month return, MRK has fallen out of the top 8 (now ranked ~11th at about +9%), so it's sold entirely per the no-churn rule. UNH, AMZN, AVGO, and AAPL remain inside the top 8, so they're kept. MSFT and NVDA have climbed into the top 5 (6-month returns of +26.7% and +17.5%) and weren't previously held, so they're added. The result is six equally-weighted positions (about 16.7% each) — the current top 5 plus AAPL, which is retained since it's still within the top 8 even though it slipped just outside the top 5. All positions stay well under the 25% single-position cap.

Our rule is simple: hold the 5 mega-cap stocks with the strongest 6-month price gains, equally weighted, and only sell a holding when it drops out of the top 8. This week, Exxon Mobil (XOM) slipped to roughly 9th place in 6-month returns, falling out of the top 8, so we sell it entirely. Amazon (AMZN) surged into the top 5 after a blowout earnings report showing accelerating cloud (AWS) growth and rising profits, so we buy it as our new 5th holding. UnitedHealth (UNH) remains our top performer by a wide margin, benefiting from a business turnaround and analyst upgrades, so we keep it. Merck (MRK), Apple (AAPL), and Broadcom (AVGO) all remain comfortably inside the top 5 as well, so we keep them too, just trimming or adding slightly so all five positions are equal at 20% of the portfolio each.

Ranking the mega-cap universe by 6-month return puts AAPL, MRK, JPM, AVGO, and UNH at the top, with XOM close behind in 6th place. Our current five holdings are AAPL, MRK, XOM, AVGO, and UNH. Since the strategy only sells a stock when it drops out of the top 8 (to avoid unnecessary trading), and XOM is still comfortably inside the top 8, we keep all five current positions rather than swapping XOM for JPM. The only change this week is a small rebalance: weights had drifted slightly apart (from about 19% to 20.6% per position) due to differing price moves, so we're nudging AAPL, MRK, and XOM down and UNH and AVGO up to bring everyone back to an even 20% weight, consistent with the equal-weighting rule.

This strategy ranks mega-cap stocks by their trailing 6-month price return and holds the top 5, equally weighted, only trimming a name once it drops out of the top 8 (to avoid excessive trading). Re-ranking today: Apple (+26.7%), UnitedHealth (+26.0%), Exxon (+16.4%), Merck (+13.8%), and Eli Lilly (+11.4%) are the strongest, while Broadcom (+10.7%) is close behind in 6th place. Google/Alphabet has cooled to roughly +5.9% over six months (weighed down by an EU antitrust fine, a delayed Gemini AI model release, and rising AI capex concerns per recent news), dropping it to around 10th place - outside the top-8 buffer - so it gets sold in full. Apple, UnitedHealth, Exxon, and Merck all remain solidly in the top 5, so they're kept. Broadcom, though just outside the literal top 5, is still within the top-8 buffer (helped by its expanded custom-chip partnership with Apple through 2031), so per the no-churn rule it is retained rather than swapped for Eli Lilly, which is not currently held. After selling Google, the plan is to rebalance the five survivors (Apple, UnitedHealth, Exxon, Merck, Broadcom) back to equal 20% weights each, keeping the portfolio fully invested with no need to hold cash.

Ranking all mega-cap stocks by 6-month return, the current top 5 are UNH, AAPL, XOM, AVGO, and MRK. Our portfolio already holds UNH, AAPL, XOM, and MRK, plus GOOGL, which ranks 8th - still inside the top 8, so the no-churn rule says we keep it rather than sell it. Broadcom (AVGO) has surged into the top 5 (driven by strong AI chip demand and a new $30B Apple chip supply deal), but we don't currently own it, so we're adding it. Since none of our current names dropped out of the top 8, we don't sell any outright - we simply trim each existing position slightly (from roughly 20% down to about 16.7%) to free up cash to buy AVGO at an equal 16.7% weight, keeping all six eligible momentum names equally weighted.