Sanctuary Portfolio Rebalance
Sanctuary Advisors Boosts Treasury and Quality ETFs, Trims Bond and Retail Stakes
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Key Points
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Sanctuary sold 16,699 shares of TLH in the first quarter, leaving 681,690 shares; the ETF tracks the ICE U.S. Treasury 10-20 Year TR index and was launched January 5, 2007 under BlackRock management.
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Sanctuary increased its QUAL stake by 6.4% to 604,311 shares (after buying 36,521) and the ETF accounts for about 0.6% of Sanctuary's portfolio, ranking it as Sanctuary’s 25th biggest holding with a position near $115.9 million.
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Sanctuary boosted its GOVT stake by 119.3% to 4,042,192 shares, valued at about $92.6 million; GOVT tracks the ICE U.S. Treasury Core Bond index.
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Sanctuary’s DGRO position rose by 1.4% to 984,746 shares; DGRO opened at $76.52, with a 50-day moving average of $75.14 and a 200-day moving average of $72.93, alongside a market cap of about $41.76 billion and a P/E around 19.66.
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Sanctuary reduced its Costco Wholesale stake by 4.8% to 102,748 shares, about $102.38 million, and Costco constitutes roughly 0.6% of Sanctuary’s portfolio, ranking as Sanctuary’s 29th biggest holding.
Sanctuary Advisors LLC made a bold bet on broad Treasury bonds in early 2026, more than doubling its stake in the iShares U.S. Treasury Bond ETF (GOVT) by 119.3% to over 4 million shares worth about $92.6 million, according to Watchlist News. At the same time, the Indianapolis-based wealth manager trimmed its long-duration Treasury exposure and cut its Costco Wholesale position.
The moves reflect a wider shift inside Sanctuary's $18.5 billion reported portfolio. The firm steered capital away from higher-risk, long-dated bonds and premium-priced retail stocks. It moved instead toward short-to-mid duration Treasuries, dividend growers, and quality-factor equities.
Sanctuary More Than Doubles Its Broad Treasury Bond Stake
Sanctuary bought 2,198,721 new shares of GOVT during the first quarter, per Watchlist News. That pushed its total to 4,042,192 shares. GOVT tracks the ICE U.S. Treasury Core Bond index and holds a mix of short, medium, and long-term U.S. government debt. Unlike long-duration funds, it spreads interest-rate risk across the curve.
The firm also trimmed its iShares 10-20 Year Treasury Bond ETF (TLH) by 2.4%, selling 16,699 shares. That left 681,690 shares worth roughly $68.7 million. TLH focuses only on the 10-to-20-year maturity range, which takes harder hits when interest rates stay high. Sanctuary appears to have swapped long-duration risk for broader, safer coverage.
Rising Rates in 2026 Pushed Advisors Away From Long Bonds
The Federal Reserve kept its benchmark rate in the 3.50%–3.75% range through much of 2026. Sticky inflation hovering near 3% left little room for cuts. That pushed 10-year Treasury yields from roughly 3.97% to 4.88% by late March. Long-duration bonds like TLH lose value fastest when yields rise, making them a liability in this environment.
Fixed-income strategists broadly warned against holding long-duration debt in mid-2026. Sanctuary's rotation — out of TLH and into GOVT — fits that playbook. By moving to a fund with a shorter average duration, the firm kept its Treasury exposure while cutting its sensitivity to further rate increases.
Costco Trimmed as Premium Valuation Draws Scrutiny
Sanctuary sold roughly 5,178 shares of Costco Wholesale (COST), cutting its stake by 4.8% to 102,748 shares worth about $102.4 million, according to Watchlist News. Costco now ranks as Sanctuary's 29th largest holding, making up about 0.6% of its portfolio. The sale comes as COST traded at a forward price-to-earnings ratio above 40 times — well above the market average.
Costco's business remained strong. The company posted a 10.6% year-over-year net sales gain in June 2026. But some analysts argued that its sky-high valuation left little margin for error. Sanctuary's trim looks like a profit-taking move — locking in gains from years of growth before any potential pullback in consumer spending.
Quality and Dividend ETFs Get a Modest Boost
Sanctuary also added 36,521 shares to its iShares MSCI USA Quality Factor ETF (QUAL) position, a 6.4% increase to 604,311 shares worth $115.9 million, per Watchlist News. QUAL targets U.S. companies with strong earnings, low debt, and stable returns. It now ranks as Sanctuary's 25th biggest holding, making up about 0.6% of its portfolio.
The firm also nudged its iShares Core Dividend Growth ETF (DGRO) up by 1.4% to 984,746 shares, valued at about $69.1 million, according to Watchlist News. DGRO had a 200-day moving average of $72.93 and a market cap near $41.76 billion. Both moves point to the same theme: Sanctuary is favoring steady, cash-generating companies over high-growth, high-multiple names.
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