NAAIM Speaks is monthly newsletter containing market insights and analysis from NAAIM member firms. This newsletter 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.
Are We Having Fun Yet?
By: David Moenning, Heritage Capital Research
It’s been a very busy start to the new year and there are a great many pieces to the puzzle that make up this market. While I am short on time this morning, let’s see if we can’t run through the host of issues that investors are attempting to deal with at the present time. So let’s see here, we’ve got insane volatility. Lots and lots (and lots) of Fedspeak. A spike in rates…
Market Due for a Proper Correction in 2022
By: Paul Schatz, Heritage Capital LLC
The new year is looking riskier, fraught with landmines and merits some portfolio rebalancing. We’re not looking for a significant bear market in 2022, but the economic and political environment should reward investors who move some assets from equities to fixed-income investments….
That Got Ugly Fast
By: Ryan C. Redfern ShadowRidge Asset Management
Well, that got ugly fast. The S&P 500 is now in range to achieve the largest loss in January going back to 1928 (reuters.com). The previous January with the largest loss was in 2009 when the market started its last leg down of the 2008 recession period. Luckily for us, our data said to start playing it safe just as the downturn began to accelerate…
The Message From the NAAIM Indicator Wall
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 Early Indicator Board , which is designed to suggest when the table is set for the trend to “go the other way.” Note this board did a nice job warning of both the most recent correction and the ensuing bounce.
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.
Risk Remains Elevated
By: Rob Bernstein, RGB Capital Group
Risk in the stock market remains elevated. Investors are digesting the impact of higher inflation, a more hawkish Federal
Reserve, poor corporate earnings, and geopolitical issues to name a few. The truth is we don’t usually know what is creating
the increased level of volatility until sometime in the future and we never know exactly how long the volatility will last.
Therefore, it is important to manage portfolio risk in the event this is the beginning of a protracted bear market decline…
Market Has A Bad Case of Halitosis
By: Craig Thompson, President Asset Solutions
Market breadth has been deteriorating for months. In our January 25, 2022 Update I highlighted how important segments of the market (Industrials, Transportation, Small Cap, and International Indexes) were falling or consolidating while major market indexes were rising last year. And in our January 3, 2022 Update we explained how large-capitalization stocks were advancing; however, small, mid, and micro-capitalization indexes were not participating in the advance. Nothing has changed over the past month in that stock market breadth is still poor…
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:
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.
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.
This Little Piggy
By: Sam and Bo Bills Bills Asset Management
This little piggy went to market and THIS little piggy went home. With the market volatility as it is, we are sitting out much of the day-to-day movements. As the saying goes, pigs get fat and hogs get slaughtered…
Cash is King
By: Dexter P. Lyons Issachar Fund
The Issachar Fund is still 100% in Cash! All the major indexes are trading below their 50-day moving averages, indicating a higher risk environment. The junk bond market tells us that investors may have lost their risk appetite. The 30-year Fed Rate mortgage went from 3.11% to 3.55% this year! That equates to a 14% increase in a 30-year mortgage which could seriously put a damper on new home purchases. Oil prices are up over 16% this year alone, so inflation could be one of the many reasons the NASDAQ is down about 10% in 2022…
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.
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, Rob Bernstein, Ryan Redfern, Sam Bills, Bo Bills, Dexter Lyons, Craig Thompson, NAAIM Exposure Index, NAAIM Dynamic Allocation Model