US equity markets had a lackluster September but saw some signs of recovering on the back of “bad news”, i.e., a cooling down of the economy. In the fallout, the USHQ portfolio sustained relative gains vs the SPY (-5.4% vs -7.1%). Information Technology and Consumer Discretionary were the main sourc...
The Fed says that to get back to 2 percent inflation, the US unemployment rate must increase by ‘just’ 0.6 percent through 2023-24. All well and good you might think, except that the Fed is forecasting something that has been unachievable for at least 75 years! Is the Fed gaslighting us? And what do...
Russia’s conflict with the West will escalate and trigger more bad news for risky assets this fall. Beyond that, stalemate looms. Latin American equities present a potential opportunity once the macro and geopolitical backdrop improve....
The MacroQuant Global Equity and Bond scores increased month-over-month. However, the Equity Score remains at a low level, keeping the sector model tilted toward defensives and Energy vs cyclical sectors. The IT Score also moved from bearish to neutral. This past month, our style indicator transitio...
As our clients know, we have a bearish long-term view on equities. However, we are well aware of the profitable opportunities that swift and furious bear market rallies present to nimble investors. In this short daily note, we will start by summarizing our long-term views on the market, followed by ...
This week, we present our quarterly review of the BCA Research Global Fixed Income Strategy (GFIS) model bond portfolio for Q3/2022. We also discuss the model portfolio’s expected performance over next 3-6 months after our recent moves to reduce overall duration exposure and increase the underweight...
MacroQuant is overweight bonds, underweight equities, and neutral on cash. Within the equity universe, the model is overweight Japan, the US, and the UK, underweight the Euro Area countries and China, and neutral the remaining countries. The sector model favors defensives and Energy over cyclical se...
We remain bearish on equities. Inflation is a monetary phenomenon that is embedded and perpetuated by a wage-price spiral. The Fed will “keep at it until the job is done.” Economic growth is slowing, and an earnings recession as soon as the end of this year is highly likely. US equities are not chea...
