Leuthold Core Investment [LCORX] [LCRIX] is a flexible or go anywhere tactical asset allocation fund. It is adept to use various non-traditional assets in different economic cycles.

Steven Leuthold is the chief investment officer and veteran for the fund, having managed the fund for 15 years. The fund mainly invests in stock market, including U.S and emerging country, and fixed income securities. However, in the past, the fund has used alternative investments for its advantage. This is reflected by its long term performance: as of 3/31/2011, the fund achieved 7.91% annualized return in the past 10 years, ranked number 1 in Morningstar’s large blend category.

Based on its Feb. 1, 2011 report, the fund invested 49% of portfolio assets in U.S. traded stocks (SPY), with an additional 16% of assets invested in Emerging Country Equities (EEM). These two holdings account for 65% of total assets. There is a 2% equity hedge focused on shorting small cap stocks (IWM) which reduces net equity exposure to 63%. The short hedge is a common strategy employed by Leuthold in the past.

In addition to the above holdings, the funds has exposure in Real Estate Investment Trusts (7% holding) (IYR) (ICF), Gold and Silver (5% holding) (GLD), (SLV). It further has 4% Brazilian Bonds, indicating the manager's optiministic outlook on Brazilian currency Real.

For the latest Leuthold fund (LCORX) asset allocation analysis, we use MyPlanIQ's SmartMoneyIQ tool. The following table illustrates the analysis as of 4/8/2011

LCORX Asset Correlation Analysis

The above table is derived by MyPlanIQ SmartMoneyIQ tool. The percentage on each column reflects the portfolio’s correlation coefficient with the asset class benchmark for that column. (assuming all correlation coefficients are summed to 1). They do not necessarily reflect the actual asset allocation of the fund.

It is interesting to note that the fund's correlation with U.S. bonds (AGG) has increased in the last week. Given the manager's outlook  in Q4/2010 " We continue to believe that the bond market is vulnerable to a significant correction, with interest rates poised to move much higher.”, this might be just due to its short term tactical move or purely because of its holdings were more correlated with U.S. bonds recently.

Symbols: LCORX, SPY, EEM, IYR, IWM, GLD, SLV, GDX, ICF, AGG, BWX