Monthly Commentary Report
Friday, 11 June 2021
Biden's Infrastructure Plan: Last week, President Biden unveiled his $6 trillion budget for 2022 in reference to his agenda and aspirations for the next decade. In addition to his $4 trillion American Jobs Plan and American Families Plan, Biden aims to reinvest in research and development, education, public health, clean energy, and the social safety net. The budget will also be used to enhance and improve infrastructure through updating highways, ports, bridges, and airports.
Monthly Commentary Report
Monday, 10 May 2021
April Performance: The S&P 500 Index was up 5% in April, driven by strong earnings and improving macro-economic data. Enthusiasm for stocks remains quite high with individual investors holding more equities than ever before, fueled by a blowout earnings season, the prospect of a strong economic recovery, and government stimulus. According to data from JP Morgan and the Federal Reserve, stock ownership among US households rose to 41% of their total financial assets in April, the highest level on record.
Our Takeaways from this Fascinating Saga
Tuesday, 02 February 2021
With all the hype around the recent GameStop saga and some of the questions we have already incurred, we wanted to address what happened and our thoughts and takeaways regarding this fascinating topic. While it may not have meaningful impacts on the broad economy for now, it is an example of the potential excesses brewing under the hood. Investors need to be aware of this risk and prepare rather than predict when it will end.
Friday, 16 October 2020
Q3 2020 Market Commentary
As the summer pulls to a close, a global reopening amidst the COVID-19 pandemic has led to a resurgence in case growth and fatalities. The final quarter of the year will witness economies fighting for the growth as the winter challenges the pandemic response, as well as the most contentious US election in recent memory.
For the first time in almost 3 years, our Risk Odometer turned Defensive! This is a substantial change and does not happen often.
Monday, 14 January 2019
- Risk Odometer’s outlook downgraded to defensive for the first time in 3 years
- Making sense of a very challenging investment environment in 2018
- Our outlook for 2019 and where we see opportunities
We recommend investors use caution in these environments and carefully review their risk. The timing of our downgrade occurred mid-month, providing us the opportunity to allocate away from risk assets such as equities and increase our position in Treasuries and cash. The timing of our Odometer proved valuable as December 2018 became the worst December since the Great Depression!
The causes of this downgrade are the result of negative changes in technical indicators (Technical Price Action, Breadth and Volatility). Fundamental indicators (Leading Economic Indicators and Earnings) remain positive. Although there is currently a disconnect between the two, we still advise taking caution in these environments. Technical indicators are better timing tools than fundamentals. They give more false signals but are also early warning signs for changes in fundamental signals.
We take a deeper dive into the volatility that sent markets tumbling in early February.
Friday, 09 February 2018
The elastic snapped as it always does when it gets stretched too far. Only hindsight will tell us where the bottom lie. Picking short-term bottoms remains the search for the holy grail. Instead, we review the economic data prior to the correction, which shows a strong foundation. Given the underlying strength, we do not expect this foundation to sustainably deteriorate through 2018.
The first quarter of 2018 saw a resurgence in volatility. We review what caused this, our opinions regarding it and how we are planning to manage through it.
Thursday, 18 January 2018
Reviewing the Quarter – Our Opinions Regarding the Recent Volatility
Prior to the first quarter of 2018, the market had one of the most remarkable runs in history. Following the election of Donald Trump in November 2016, the S&P 500 began an amazing streak of 15 consecutive months of positive returns and gaining nearly 40%!
We are extremely optimistic for how our strategies are positioned to manage 2018.
Friday, 29 December 2017
Their competitive advantage over many traditional investment options are their disciplined, tactical nature. We describe them as an alternative to the traditional buy and hold approach. The traditional buy and hold style manages a portfolio with a static risk approach.
2017 will go down as an unprecedented year in the financial markets and 2018’s outlook looks good but not without risks.
Friday, 01 December 2017
There are plenty of risks that worry us. We think investors should monitor these risks going forward because investing will not be as easy as it was in 2017. We also have some sectors we like overweighting for 2018 which could help investors navigate a more challenging environment.
Tuesday, 03 January 2017
After stumbling out of the gate this year, global equity markets have put in relatively consistent gains since the February lows. U.S., U.K. and emerging market equities have provided much of the leadership, while markets in the Eurozone and Japan lagged.