What is Carlson's Adaptive 60/40?

Holds 60% SPY and rotates the 40% defensive sleeve monthly into the strongest of TLT, GLDM or PDBC by 1/3/6/12-month momentum. A regime-adaptive replacement for the fixed bond ballast in a classic 60/40.

Who created the Carlson's Adaptive 60/40 strategy?

Carlson's Adaptive 60/40 was developed by Thomas Carlson. It is based on Carlson, T. (2026). Adaptive 60/40: Rethinking the Defensive Sleeve (LinkedIn).

What is the historical return and maximum drawdown of Carlson's Adaptive 60/40?

Backtested from 1986-02-28 to 2026-08-11, Carlson's Adaptive 60/40 returned 11.6% CAGR with a -35.6% maximum drawdown and a Sharpe ratio of 1.06. Past performance does not guarantee future results.

How often is Carlson's Adaptive 60/40 rebalanced?

Carlson's Adaptive 60/40 is rebalanced monthly. BestFolio publishes the updated allocation signal each period.

Is Carlson's Adaptive 60/40 a tactical asset allocation strategy?

Yes. Carlson's Adaptive 60/40 is a tactical asset allocation (TAA) strategy: it adjusts its holdings based on market signals each period rather than holding a fixed allocation.

Carlson's Adaptive 60/40

Name: Carlson's Adaptive 60/40, Backtest Time Series
Creator: BestFolio
License: https://creativecommons.org/licenses/by-nc/4.0/

Carlson's Adaptive 60/40 is a tactical asset allocation strategy reviewed on a monthly cadence. Its hypothetical backtest runs through 2026-08-11. BestFolio supplies the public rule or approach and backtest context; current signals, allocations, and paid interactive data remain restricted to Pro access. No publication or construction date is recorded, so no observed-versus-simulated boundary is claimed; all displayed returns are hypothetical. Users review each scheduled signal and place any resulting trades in their own brokerage. BestFolio does not execute trades or provide personalized investment advice.

Cadence: Monthly
Backtest data through: 2026-08-11
History boundary: No publication or construction date is recorded, so no observed-versus-simulated boundary is claimed; all displayed returns are hypothetical.
Rule / approach: 1. Hold 60% SPY at all times 2. Compute average momentum (mean of 1m, 3m, 6m, 12m returns) for TLT, GLDM and PDBC 3. Allocate the remaining 40% entirely to the single highest-momentum hedge 4. Rebalance monthly on the last trading day
BestFolio supplies: the public rule or approach and backtest context; current signals, allocations, and paid interactive data remain restricted to Pro access
Customer action: Review each scheduled signal and place any required trades in your own brokerage; BestFolio does not execute orders.
Costs and exclusions: net of a modeled one-way transaction cost (10 bps, scaled up to 3x under stress); taxes, fund-expense drift, or market impact are not modeled
Freshness: The latest available backtest ends 2026-08-11. A run timestamp is not exposed here, so no stronger freshness claim is made.
Next expected action: First trading day of September; scheduled 2026-09-01 at 09:30 ET. Review the published signal before placing any trade.

Carlson's Adaptive 60/40 at a glance

Carlson's Adaptive 60/40 is a tactical asset allocation (TAA) strategy by Thomas Carlson across US Equity, Long-Term Treasuries, Gold, Commodities, rebalanced monthly. Backtested 1986-02-28 to 2026-08-11 (40.3 years): 11.6% CAGR, 1.06 Sharpe, -35.6% max drawdown, 12.6% volatility.

Type: Tactical (TAA)
Author: Thomas Carlson
Rebalancing: Monthly
Risk: Moderate
Period: 1986-02-28 to 2026-08-11
CAGR: 11.6%
Sharpe: 1.06
Max Drawdown: -35.6%
Volatility: 12.6%

Carlson's Adaptive 60/40 — Tactical Asset Allocation Strategy

Thomas Carlson's Adaptive 60/40 modernizes the classic balanced portfolio by rethinking the defensive sleeve. The 60% equity allocation (SPY) is held constant; the 40% "ballast" is no longer a static bond position but rotates each month into whichever liquid macro hedge is showing the most relative strength.

The premise is that the traditional bond ballast can fail exactly when it is needed: 2022 was a vivid example, when rising rates turned duration into a liability rather than a hedge. Instead of anchoring to bonds, the strategy rotates the 40% sleeve into the single strongest of long Treasuries (TLT), gold (GLDM) or broad commodities (PDBC), ranked by the equal-weighted average of 1, 3, 6 and 12-month returns. No leverage, no forecasts, one trade a month.

Carlson's Adaptive 60/40: frequently asked questions

What is Carlson's Adaptive 60/40?: Holds 60% SPY and rotates the 40% defensive sleeve monthly into the strongest of TLT, GLDM or PDBC by 1/3/6/12-month momentum. A regime-adaptive replacement for the fixed bond ballast in a classic 60/40.
Who created the Carlson's Adaptive 60/40 strategy?: Carlson's Adaptive 60/40 was developed by Thomas Carlson. It is based on Carlson, T. (2026). Adaptive 60/40: Rethinking the Defensive Sleeve (LinkedIn).
What is the historical return and maximum drawdown of Carlson's Adaptive 60/40?: Backtested from 1986-02-28 to 2026-08-11, Carlson's Adaptive 60/40 returned 11.6% CAGR with a -35.6% maximum drawdown and a Sharpe ratio of 1.06. Past performance does not guarantee future results.
How often is Carlson's Adaptive 60/40 rebalanced?: Carlson's Adaptive 60/40 is rebalanced monthly. BestFolio publishes the updated allocation signal each period.
Is Carlson's Adaptive 60/40 a tactical asset allocation strategy?: Yes. Carlson's Adaptive 60/40 is a tactical asset allocation (TAA) strategy: it adjusts its holdings based on market signals each period rather than holding a fixed allocation.

Backtest Performance (1986-02-28 to 2026-08-11)

Metric	Carlson's Adaptive 60/40
CAGR	11.6%
Max Drawdown	-35.6%
Sharpe	1.06
Sortino	1.47
Volatility	12.6%
Calmar	0.33
Total Return	8345.1%
Backtest Period	40.3 years

Strategy Details

Type: Tactical (TAA)
Rebalancing: monthly
Risk Level: moderate
Variants: 1
Author: Thomas Carlson
Source: Carlson, T. (2026). Adaptive 60/40: Rethinking the Defensive Sleeve (LinkedIn)

Asset Classes

US Equity
Long-Term Treasuries
Gold
Commodities

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