Running Money: July 2026 Update

1H26 Update:‍ ‍

Smash all the headlines together for the last year or so, from the Tariff Shock in April 2025 to the War in the Middle East in March 2026 and literally none of it matters.  The resiliency of the market has been incredible. The last 1.5 years of “Trump Volatility” demonstrates what successful investors already know – focus on the long-term, get your portfolio allocations sorted (for the risk profile and time horizon you can endure) and tolerate the volatility.

Stocks are up. Everything else is noise.‍ ‍

America’s “capitalist” exceptionalism is stronger than ever. The US is a leading source for Technology innovation and a leader in global Energy production…everything else is noise. The path may not always be smooth and Trump sure is taking us on a bumpy ride...regardless, the trick is to look past the short-term shocks and focus on the long-term.  The 250th 4th of July is an opportune time to recognize the institutional strength of the US and that Trump is just another president. Rarely does a president affect what happens in the equity market medium to long-term – despite their claims!   Please recognize WLA commentary is not investment advice. If would like to talk directly, just email me hello@westernlevel.com. Additional disclosures below.  

WLA Portfolio & 1H2026 Performance: ‍ ‍

WLA manages client portfolios in three silos. 

Silo 1: Short-term cash and treasury bonds. 

Silo 2: US Equity. 

Silo 3: Satellite Portfolio (low correlation to US Equity, income and total return).

Silo 1: Short-Term Cash and Treasury Bonds.  ‍ ‍

Keep it simple.  Avoid duration risk (example: 7, 10, 15 and 20 year maturities).  Avoid using bond ETFs and bond mutual funds (perpetual duration exposure).  When you avoid risk in your bond allocation, it is WLA’s belief that this opens up opportunity for more exposure to “good risk” in the rest of your portfolio (Silo 2 and 3).  For 2026, WLA has been buying 2-year treasury bonds for client portfolios in May and June with 2-yr Treasuries yielding 3.9% to 4.2%, about 0.50% higher than 1Q26 levels.‍ ‍

Silo 2: US Equity‍ ‍

I’ve shared my concerns across multiple WLA letters in the last two years about the concentration risk the MAG7 represent in the S&P500 and this has indeed been on point.  The Magnificent 7 (AAPL, GOOGL, TSLA, META, AMZN, NVDA, MSFT) have seen high volatility and low return as represented in the ETF MAGS.  Remember the MAG7 is about 35% of the SPY. Choosing to allocate client capital to equal weight and value bias ETFs has been good – especially for new clients in the last 12 months amidst the volatility.  WLA has NO client exposure to the MAGS ETF (MAGS, -2.52% year to date 6/30/2026).   

WLA US Equity examples, fund performance year-to-date through June 30, 2026:

IWX (Russell Top 200 Value), +15.33%

OEF (S&P 100), +7.19%

BSCMX (Small Cap Value), +22.90%

SPY (S&P 500), +10.09%

EQWL (S&P 100 EW), +10.13%

RSP (S&P 500 EW), +11.97%

*BSCMX position established in FEB2026

*EW=Equal Weight

Silo 3: Satellite Portfolio October 2025: “WLA typically maintains three to five positions in the Satellite Portfolio per client account.  The goal is to identify attractive total return, often with an income component and low correlation to US equity markets. While past performance is no guarantee for future results, lower correlation plus income may reduce draw-down in an equity market correction and that is one of the goals for this portion of the portfolio.  This includes a range of ideas: fixed income alternatives, inflation hedges, commodities, dividend focused exposures and other specialty sectors with attractive total return potential.”

Fast forward to 2026 and WLA’s Satellite Portfolio has been incredibly supportive to reduce portfolio volatility and support attractive total return.  In the broad market, 1Q26 produced some ugly short-term declines in the S&P500 and Nasdaq100 of about -7% and -9% respectively.  In contrast, Energy, MLPs, Dividend Equity, Utilities, and Gold all had an “Up Quarter” in 1Q26.  

WLA Satellite Portfolio examples, fund performance year-to-date through June 30, 2026:

SCHD (US Dividend) +17.50%

PHYS (Gold) +4.85%

AMLP (MLPs), +14.66%

RSPA (Equity Income), +9.69%

SRUUF (Uranium), -5.5%

XLE (Energy), +20.41%

XLU (Utilities), +7.62%

IDV (International Dividend), +8.21%

FRDM (Emerging Markets) +43.46%

*FRDM Established in FEB2026 and Exited in JUN2026.  Short-term buy/sell is not the goal – the extreme exposure to three Asian semiconductors stocks became something I could NOT ignore.  As highlighted here: https://westernlevel.com/commentary/its-ail-for-one‍ ‍

*RSPA position established across 1Q26 and 2Q26. ‍ ‍

2026 YTD Summary: Market-like returns with less risk.  ‍ ‍

Silo 1: US Treasuries: 3.5% to 4.20% annual yields.

Silo 2: US Equity: Keeping up with the S&P500 + better diversification.

Silo 3: Satellite Portfolio: Lower correlation to US Equity, attractive income + total return.   '

I'm ready for 2H2026...what an amazing time.  

Best – Jon Fritzinger      

Not every client holds every ETF example listed in this commentary. Client specific exposure (entry points and portfolio sizing) for all the ETFs listed above varies based on numerous factors.  Past performance is not indicative of future results. Performance figures above are not representative of client results due to varying entry points at the client account level and dollar cost averaging.  The stated performance figures are derived from the stated performance for the year to date period from the fund company’s facts sheets.  Western Level Advisors LLC fees are not reflected in any of the performance figures.

ETF/Fund information links are as follows:

https://www.ishares.com/us/products/239722/ishares-russell-top-200-value-etf‍ ‍

https://www.ishares.com/us/products/239723/ishares-sp-100-etf‍ ‍

https://www.brandes.com/funds/fund/brandes-small-cap-value-fund/bscmx‍ ‍

https://www.ssga.com/us/en/individual/etfs/state-street-spdr-sp-500-etf-trust-spy‍ ‍

https://www.invesco.com/us/en/financial-products/etfs/invesco-sp-100-equal-weight-etf.html‍ ‍

https://www.invesco.com/us/en/financial-products/etfs/invesco-sp-500-equal-weight-etf.html‍ ‍

https://www.schwabassetmanagement.com/products/schd \‍ ‍

https://sprott.com/investment-strategies/exchange-listed-products/physical-bullion-funds/gold/‍ ‍

https://www.alpsfunds.com/exchange-traded-funds/amlp‍ ‍

https://www.invesco.com/us/en/financial-products/etfs/invesco-sp-500-equal-weight-income-advantage-etf.html‍ ‍

https://sprott.com/investment-strategies/exchange-listed-products/physical-commodity-funds/uranium/‍ ‍

https://www.ssga.com/us/en/individual/etfs/state-street-energy-select-sector-spdr-etf-xle‍ ‍

https://www.ssga.com/us/en/individual/etfs/state-street-utilities-select-sector-spdr-etf-xlu‍ ‍

https://www.ishares.com/us/products/239499/ishares-international-select-dividend-etf‍ ‍

https://freedometfs.com/frdm/‍ ‍

Not investment advice. Above performance figures are not representative of WLA client results, WLA client performance is based on different time periods among other factors. Actual client performance varies based on multiple factors including risk tolerance, when WLA was hired and when positions were established and the deduction of WLA ‘s management fees. WLA client holding period for the above examples varies, do not assume it’s the year to date period for any of the examples provided, it may be longer or shorter.  Do not assume every WLA client holds every ETF example, client risk tolerance and when WLA was hired effects portfolio allocations. Read the disclosures on the ETF links provided.  Performance listed is for illustration purposes only, not an endorsement to buy or sell.  Do you own research and/or discuss with a professional investment advisor.  Read full disclosures located in this email and at www.westernlevel.com.