NAAIM Speaks is monthly newsletter containing market insights and analysis from NAAIM member firms. “Speaks” is designed to provide a plethora of market analysis, indicators, some occasional humor, as well as a summary of NAAIM’s proprietary Dynamic Asset Allocation Model and Managers Exposure Index. The report is for informational uses only and is not to be construed as investment advice.

When Marko Talks

By: David Moenning, Heritage Capital Research

Published: 11.9.20

Long-time readers of my oftentimes meandering morning market missive likely know that I only listen to/read the opinions a handful of market analysts. I learned a long time ago that everyone has an opinion, and it is best not to listen to everything anyone offers theirs. However, JP Morgan’s Marko Kolanovic, who is the head of the firm’s macro quantitative and derivatives strategy, is someone that I respect and pay attention to. Kolanovic’s team produces macro research that is unique and looks at capital flows that are hard to find. So, in short, when Marko talks about the macro view of the market, I tend to sit up and take notice.

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The Light at the End of the Tunnel

By: Paul Schatz, Heritage Capital LLC

Published: 11.9.20

It was amazing to wake up to see the huge success of Pfizer’s COVID vaccine! 90% efficacy. What a total game changer for the country and the world with hundreds of other vaccines and therapeutics behind that. I know that I will be the first in line when they allow me to receive the vaccine, probably next year. (For full transparency, we own Pfizer which has been a dog for too long.) Global stock markets are soaring again, but I do not believe this all because of the vaccine news….

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Mr. Market’s Elusive Logic

By: Jeffrey Miller Dash of Insight

Published: 11.7.20

Let us try a thought experiment. We will use the Wayback Machine on a very light setting to look back just one week. (Mrs. OldProf informed me that I should include a link because my audience was too young to have watched the flying squirrel). Suppose a week ago we knew everything about the upcoming election. We knew how the story played out, the challenges, the speeches, the margin of victory, and the results in various states. With all this information in hand we had to guess the market reaction. Would anyone’s forecast have even come close to the actual rally? Markets had gone through wild gyrations, with a week of embrace for a “blue wave” since it would increase chances for fiscal stimulus. Then a week of decline as investors supposedly reconsidered that conclusion. Why was this week different?…

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The Message From the NAAIM Indicator Wall: The Trend is Your Friend

By: National Association of Active Investment Managers

Updated: 11.6.20

The NAAIM Indicator Wall provides a weekly update to a robust array of stock market indicators. The “wall” includes readings and explanations of indicators and/or models in the areas of price/trend, momentum, key price levels, overbought/sold readings, sentiment, monetary, economic, inflation, and market cycles.

This time, we’re featuring the Trend Board , which is designed to identify the state of the stock market trends.

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Link to NAAIM Indicator Wall

Note: The Indicator Wall is a benefit provided to NAAIM Members and is password protected. To obtain a temporary password, contact NAAIM at 888-261-0787.

At The Forefront Of Our Collective Minds

By: Ryan C. Redfern ShadowRidge Asset Management

Published: 10.30.20

The impact of the election and implications going forward is much more at the forefront of our collective minds. First and foremost, I have no idea who is going to win and there are a lot of scenarios that can play out depending on various aspects of American politics. The polls and odds-makers have their favorites, but after the last election cycle, those are difficult stats to put your faith and trust in. Those “stats” can be unreliable. What we do know is no matter which way it goes, there will continue to be opportunities in various pockets of the market, and we will continue to watch for them….

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Don’t Expect A Big Decline

By: Rob Bernstein, RGB Capital Group

Published: 11.2.20

While we do not know what the future holds, most of the indicators that I track are not indicating a long-term, protracted
decline. I suspect the short-term uncertainty we have experienced since early September may begin to resolve itself once
the election results are known. A disputed election could certainly lead to some continued volatility, but there will be a
result at some point, at which time investors will be able to focus on factors that drive market performance. In fact, we are
entering a seasonably favorable time of year for the stock market which bodes well for the remainder of the year…

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The NAAIM Dynamic Allocation Model

Designed to be a value-add benefit to membership, NAAIM offers a Dynamic Asset Allocation Model based on the NAAIM Indicator Wall of indicators and models. The overall objective of the model portfolio is to dynamically adapt to changing market environments and to keep equity exposure in line with conditions. The model targets a normalized allocation of 60% stocks and 40% Bonds.

Here is this week’s model allocation:

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The model has been run live on the NAAIM website for several years and has demonstrated the ability to reduce exposure to market risk during negative environments such as those seen in 2015-16 and 2018.

More on the Dynamic Allocation Model and Historical Readings

The NAAIM Dynamic Allocation Model is for illustrative and informational purposes only, and does not in any way represent an endorsement by NAAIM or an investment recommendation.

Something For Nobody

By: Sam and Bo Bills Bills Asset Management

Published: 11.6.20

Despite many fears and doomsday predictions, the sun came up on November 4th. However, nobody seems particularly
thrilled with the results. While the Democrats are all but certain to take the White House, they lost many seats across the
country, lost seats in the House and appear to have failed to win a majority in the Senate. On the flip side, Republicans look
to lose the White House, but gain seats in the House and throughout the country and will likely maintain a slight majority in
the Senate. Nobody appears to be happy with the results!…

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The Weight Of The Evidence Suggests…

By: Craig Thompson, President Asset Solutions

Published: 11.2.20

Hallmarks of a major market top are complacency, an early move to risk-off assets, and a high degree of correlation seen in stocks after the peak. I am not seeing any of these signs (at least not yet) and thus have to conclude that odds favor recent market weakness likely being temporary in nature and not the beginning of a major stock market correction. With that in mind, let’s look at some charts…

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Gridlock is Good

By: Dexter P. Lyons Issachar Fund

Published: 11.9.20

The market seems to like the election results with a possible divided government as the S&P 500 Index rallied to less than 2% from an all-time high. I have been buying growth stocks with accelerating sales and earnings exhibiting sound chart patterns of accumulation. I believe the market is trying to tell us that all may be well as long as there is gridlock in Washington. My job is to manage risk, and I currently see a lower risk environment to invest in. I believe the market is looking good for now. If I am wrong, I will do my best to get right and avoid life-changing losses….

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The NAAIM Member Exposure Index

The NAAIM Exposure Index represents the average exposure to US Equity markets as reported by our members in the organization’s weekly survey. Note that many NAAIM members are risk managers and tend to reduce exposure to the markets during high risk environments.

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More on the NAAIM Exposure Index

NOT INVESTMENT ADVICE. The analysis and information in this report and on our website is for informational purposes only. No part of the material presented in this report or on our websites is intended as an investment recommendation or investment advice. Neither the information nor any opinion expressed nor any Portfolio constitutes a solicitation to purchase or sell securities or any investment program. The opinions and forecasts expressed are those of the editors and may not actually come to pass. The opinions and viewpoints regarding the future of the markets should not be construed as recommendations of any specific security nor specific investment advice. Investors should always consult an investment professional before making any investment.

Tags: NAAIM, NAAIM Speaks, Stocks market analysis, Stock Market Analysis, Stock market, stock market indicators, David Moenning, Paul Schatz, Jeffrey Miller, Rob Bernstein, Ryan Redfern, Sam Bills, Bo Bills, Dexter Lyons, Craig Thompson, NAAIM Exposure Index, NAAIM Dynamic Allocation Model