05 ‐ Portfolio Rules & Backtesting Framework - IMGitH/dvmax GitHub Wiki

Goal

Build a basket of 10–30 ex-U.S. dividend stocks that:

• Avoids dividend cuts
• Provides stable and reasonable yield
• Limits turnover to reduce tax/friction

Scoring System

• Final Score = (AdjYield × 0.5) + (DivGrowth × 0.3) + (Stability × 0.2)
• Optionally: integrate cut probability and valuation into final score

Rebalance Logic

• Rebalance quarterly
• Limit max 20% per sector/country
• Ensure min 5 sectors/countries represented
• Replace stocks only if score gap is meaningful

Backtest Metrics

• Hit rate on avoiding cuts
• Realized yield vs benchmark
• Portfolio turnover
• Total return, drawdown avoidance, and score stability