USES Model
US Equity Sector Rotation Strategy
The USES (US Equity Sector) Model applies the same momentum-ranking methodology as the Global Index Model, but focuses exclusively on the eleven sectors of the US stock market. Rather than rotating between asset classes, it rotates between sectors — identifying which corner of the US economy has the strongest momentum each week.
How the USES Model Works
Each week, the eleven SPDR sector ETFs are scored using the same CI%, TS+, RSI, and PMO framework as the Global Index Model. The top-ranked sector becomes the model's recommended holding. Investors can implement the signal using the corresponding sector ETF, or use it as a filter to tilt their existing US equity allocation toward the strongest sector.
The Eleven US Equity Sectors
The USES Model tracks all eleven GICS sectors via their SPDR Select Sector ETFs:
| ETF | Sector | Description |
|---|---|---|
| XLK | Technology | Software, hardware, semiconductors, and IT services |
| XLV | Health Care | Pharmaceuticals, biotech, medical devices, and managed care |
| XLF | Financials | Banks, insurance, asset managers, and REITs |
| XLY | Consumer Discretionary | Retail, autos, hotels, restaurants, and leisure |
| XLP | Consumer Staples | Food, beverages, household products, and tobacco |
| XLE | Energy | Oil, gas, and consumable fuels |
| XLI | Industrials | Aerospace, defence, machinery, and transportation |
| XLB | Materials | Chemicals, metals, mining, and construction materials |
| XLU | Utilities | Electric, gas, and water utilities |
| XLRE | Real Estate | REITs and real estate management companies |
| XLC | Communication Services | Telecom, media, entertainment, and interactive media |
How Investors Use the USES Model
Pure Sector Rotation
Hold 100% in the top-ranked sector ETF each week, rotating when the leader changes.
Tilt Strategy
Maintain a diversified US equity core but overweight the top 2–3 ranked sectors.
Avoidance Filter
Use the bottom-ranked sectors as a screen to avoid the weakest areas of the market.
Combined with Global Model
When the Global Index Model signals US equities as the top asset class, use the USES Model to select the strongest sector within that allocation.
The USES Model is provided for informational and educational purposes only. Sector ETF investing involves risk, including possible loss of principal. Past performance does not guarantee future results.