Copernicus Portfolio Update: December 14, 2025 | ITA Asset Management

Copernicus is an equity-focused portfolio designed for young investors or those with ten to fifteen years ahead of them. Retired investors who can still save a modest amount each month are encouraged to use this asset allocation for at least one portfolio. While target percentages will vary from investor to investor, you may want to give serious thought to only including stocks as one of your potential portfolios. A full evaluation of Copernicus will take place on Wednesday this week.

Over the long term, it’s difficult to outperform the S&P 500 (VOO). This is the main reason to include an equity allocation in at least one of your portfolios. A slightly more conservative approach is to use the equally weighted S&P 500 Exchange Traded Fund (ETF), RSP. RSP is a new addition to Copernicus and I will be adding shares before the end of this year. The new asset allocation model shown below is the design for 2026.

Copernicus asset allocation

Below is the asset allocation plan for 2026. The asset percentages are different from last month and I have added RSP to the existing ETFs. If you are willing to take more risk, focus on VOO and RSP and lower the target rates of VYM and SCHD. SHV is a holding bucket that allows interest to be earned until purchase orders appear for an ETF such as VOO.

Copernicus recommendations for rebalancing

Next week I will be selling shares of SHV to raise money to buy more shares of SCHD and RSP. VYM is over target, so I’m letting this dividend-focused ETF ride. No change is necessary for VYM. The current recommendation for VOO is a sell with Copernicus owning zero shares, so no change is recommended.

As the months go by and new money is added to the Copernicus, the idea is to continue adding shares when the ETF is below target and the recommendation is a Buy. If the security shows a Hold or Sell status, the plan is to do nothing to minimize taxes.

I would not recommend keeping all investments in this risky portfolio. Rather, consider the Copernicus as one portfolio of several portfolios in which other portfolios contain bonds and government bonds. Longtime readers know I’m all for diversification.

• The first order of diversification is using no-load mutual funds or Exchange Traded Funds (ETFs) instead of individual stocks to build a portfolio. I prefer ETFs to mutual funds and use them exclusively.
• The second order of diversification is using different ETFs to cover different asset classes. Portfolios like Gauss, Einstein, Bethe, Bohr and Kepler do exactly this.
• The third order diversification is the use of different investment models. The Schrödinger and Copernicus are examples, because they are very different investment models.

About ten portfolios will be reviewed over the next two weeks, so new readers will see examples of asset allocation that differ from Copernicus. As mentioned above, Copernicus will undergo a full evaluation next week.

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Disclaimer: The ITA blog is an educational site designed to help individuals manage their own portfolios rather than paying fees to a ‘professional’ money manager. Rather than investment advice, the various portfolios are examples, using real money, of how individual investors might manage their own portfolio(s).

Lowell

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