The Fixed Income 10-Spot Model (internally, the ETFFI Core Aggressive Model) is the core model of the ETFFixedIncome.com family, alongside the 5-Spot Model and the Alternative Credit Model. It holds ten fixed income and income ETFs and reviews its signals once a month. It trades only on the signals registered on the last trading day of each month, and only when its trade rules are met. Its regime and factor signals also drive the 5-Spot and Alternative Credit models.
Key takeaways
- October was strong in absolute terms but slightly behind the policy portfolio. The 10-Spot returned +2.51% in October, against +2.69% for its static policy portfolio (−18 bps) and +2.29% for AGG (+23 bps).
- The longer record is ahead of both comparators. Over 12 months the model returned +4.04%, against +3.81% for the policy portfolio (+24 bps) and −0.23% for AGG (+427 bps). Year to date it is +3.42%, ahead of the policy portfolio by 27 bps and of AGG by 398 bps.
- The model has been in Defensive cash since September 24. The October 1 trade shifted it toward SGOV and SHY and away from HYG and EMB. That cost a little in a month when long Treasuries (TLT +5.6%) and dividend equity (SCHD +10.0%) rallied.
- The defensive signal strengthened in October. On October 30 the credit score was at its floor (−1.00), the defensive score was at its ceiling (+1.00), and confidence rose to 0.83.
- A trade is scheduled for Monday, November 2. The October 30 month-end signal cleared the trade rules, so the model will move halfway toward its Defensive cash targets, a one-way turnover of about 4.9%.
How the 10-Spot trades
The 10-Spot reviews its signals monthly. The signal is read at the close on the last trading day of the month, and any trade is executed on the next trading day. The model trades only on the signals registered on the last trading day of the month. The signals it computes on other days are for monitoring only.
A monthly review leads to a trade only when the model’s confidence is at least 0.35 and at least one of these holds: the proposed weights differ from the held weights by at least 1.5% one-way, the regime has changed, or about 63 trading days have passed since the last trade. When a trade is allowed, the model moves only halfway toward its new targets.
How far the model tilts away from its policy weights depends on the regime. Risk-on credit and Defensive cash get the full active overlay. Duration rally, Inflation hedge and Equity breadth get half. In Balanced income, or when confidence is low, the model goes back to its policy weights.
- Last trade: signal on September 30, executed October 1, 2026
- Next trade: signal on October 30, executing November 2, 2026
Performance
| Period | 10-Spot | Policy portfolio | AGG | Excess vs policy | Excess vs AGG |
|---|---|---|---|---|---|
| October (since the Oct 1 trade) | +2.51% | +2.69% | +2.29% | −18 bps | +23 bps |
| 3 months | +0.69% | +0.75% | +0.00% | −5 bps | +69 bps |
| Year to date | +3.42% | +3.16% | −0.56% | +27 bps | +398 bps |
| 12 months | +4.04% | +3.81% | −0.23% | +24 bps | +427 bps |
All periods end at the October 30 close. October runs from the September 30 close, 3 months from the July 31 close, year to date from the December 31, 2025 close, and 12 months from the October 31, 2025 close. The policy portfolio is the model’s static mix of the same ten ETFs. All figures are hypothetical model total returns.
What drove results
Weights after the October 1 trade, each ETF’s October return and its contribution to the model’s return. Blue cells are the model’s weights. Returns and contributions are green when positive and red when negative.
| ETF | Sleeve | Policy weight | Weight Oct 1 | October return | Contribution | vs policy |
|---|---|---|---|---|---|---|
| SCHD | Dividend equity / real assets | 10.0% | 9.6% | +9.99% | +96 bps | −1.0 bps |
| LQD | Investment grade corporates | 20.0% | 19.3% | +2.48% | +48 bps | −1.8 bps |
| TLT | 20+ year Treasuries | 8.0% | 6.7% | +5.64% | +38 bps | −6.8 bps |
| TIP | TIPS | 10.0% | 8.9% | +2.55% | +23 bps | −2.7 bps |
| SHY | 1–3 year Treasuries | 10.0% | 12.7% | +0.91% | +12 bps | +2.4 bps |
| MUB | Municipals | 5.0% | 3.6% | +3.33% | +12 bps | −4.7 bps |
| HYG | High yield corporates | 12.0% | 10.9% | +0.73% | +8 bps | −0.9 bps |
| SGOV | 0–3 month T-bills | 15.0% | 19.6% | +0.35% | +7 bps | +1.5 bps |
| EMB | EM sovereign debt | 5.0% | 2.8% | +1.83% | +5 bps | −4.0 bps |
| BKLN | Senior loans | 5.0% | 5.8% | +0.57% | +3 bps | +0.4 bps |
- Every sleeve made money in October. SCHD contributed the most, followed by LQD and TLT. The ten ETFs together added about 251 bps.
- The defensive tilt cost 18 bps against the policy portfolio. The model held more of SGOV and SHY, which earned less than 1%, and less of TLT, MUB, EMB and TIP, which rallied. The underweight in TLT cost the most, about 7 bps.
- The duration signal missed the rally. The duration score stayed at −1.00 all month, because the model needs trend and volatility confirmation before it adds duration. TLT gained 5.6% while the model was underweight.
Contributions are each ETF’s daily weight multiplied by its daily return, summed over October. The “vs policy” column is the model’s active attribution against the policy portfolio.
Current signals
The 10-Spot’s regime and factor readings also drive the 5-Spot and Alternative Credit models. Shading shows signal strength: green is +0.5 or higher, red is −0.5 or lower, and yellow is in between.
| Signal | Aug 31 | Sep 30 | Oct 30 |
|---|---|---|---|
| Regime | Balanced income | Defensive cash | Defensive cash |
| Confidence | 0.55 | 0.80 | 0.83 |
| Credit | +0.07 | −0.64 | −1.00 |
| Duration | −1.00 | −1.00 | −1.00 |
| Inflation | −1.00 | −1.00 | −1.00 |
| Defensive | +0.02 | +1.00 | +1.00 |
| Breadth | +0.20 | +0.05 | +0.17 |
| Floating rate | +0.15 | −0.11 | −0.16 |
| EM | +0.06 | −0.39 | −0.62 |
| Muni | −0.40 | −0.65 | −0.65 |
| Dividend | −0.07 | −0.17 | −0.07 |
- The regime turned defensive in late September and has held. The model moved through Risk-on credit and Balanced income several times in August and September. It switched to Defensive cash on September 24 and has stayed there for 27 trading days.
- Credit stress is the main driver. The credit score fell from +0.07 at the end of August to its −1.00 floor, while the defensive score rose to its +1.00 ceiling. With credit confirmation at 0.78, the model applies its full defensive overlay.
- Rates and inflation signals stay negative. Duration and inflation have both read −1.00 since August. Duration confirmation is at its 0.25 floor, so the model is not adding long Treasuries even after October’s rally.
The November 2 trade
The October 30 signal cleared the trade rules: confidence is 0.83, and the proposed weights differ from the held weights by about 9.8% one-way. The model will move halfway toward its Defensive cash targets on November 2. Blue cells are the weights after the trade. Green marks an increase and red a decrease.
| ETF | Oct 30 weight | Nov 2 weight | Full target | Change |
|---|---|---|---|---|
| SGOV | 19.2% | 22.2% | 25.2% | +3.0 pts |
| SHY | 12.5% | 14.2% | 15.9% | +1.7 pts |
| TLT | 6.9% | 7.1% | 7.4% | +0.2 pts |
| LQD | 19.3% | 19.1% | 19.0% | −0.2 pts |
| TIP | 8.9% | 8.8% | 8.6% | −0.2 pts |
| MUB | 3.6% | 3.4% | 3.2% | −0.2 pts |
| SCHD | 10.3% | 9.7% | 9.1% | −0.6 pts |
| BKLN | 5.7% | 5.1% | 4.5% | −0.6 pts |
| EMB | 2.8% | 1.4% | 0.0% | −1.4 pts |
| HYG | 10.7% | 9.0% | 7.2% | −1.8 pts |
The trade adds about 4.7 points to T-bills and short Treasuries. It funds that mainly by cutting high yield, EM debt, senior loans and dividend equity. The next review uses the November 30 month-end signal.
Disclosures
All results shown are hypothetical model results. They do not represent actual trading or the results of any client account. Advisory fees, taxes, platform fees and account-specific slippage are not included. Benchmarks and reference portfolios are shown for comparison only and are not targets or guarantees. Past model performance does not guarantee future results.
The 10-Spot reviews its signals monthly and trades only on the signals registered on the last trading day of each month. Daily signal readings are for information only. This update is published by Myrtle Tree Investment Research LLC as impersonal research. It is not investment advice or a recommendation to buy or sell any security, and it is not tailored to the needs of any reader.
