Investment Outlook August 2016

Our top year-to-date strategies:

SPY, the S&P500 ETF, returned 7.6%, year-to-date.

News:

  • Our in-house software is available for licensing to professional clients.
  • We are looking for registered investment advisers and wealth managers to partner with.

Market comment:

Sentiment across mainstream media remains cautious despite the S&P500 index breaking to a new all time high, on July 8th. Many investors continue to perceive both the S&P and Treasuries as overpriced and due for a correction. Increased geopolitical risk includes the recent coup attempt in Turkey and a highly unstable environment in Syria. Europe has somewhat recovered from the Brexit shock only to find itself in a new controversy over troubled Italian banks. The ECB is continuing the controversial path of negative rates policy and widespread corporate bond purchases. Increasingly low yields have many wealth advisors prepare their clients for an era of lower future returns while they issue warnings of increased volatility. Short term traders remain baffled at this somewhat ‘unresponsive’ market, where neither the Turkey failed coup or the news from Italy have managed to ‘spike’ the VIX, which has steadily crawled down to a low 11.8.

And yet we are enjoying a wonderful year. Our top two strategies continue to provide handsome returns: 34% for MYRS and 40% for 3x UIS. Our average return of all our strategies is 15.8%. 

July was most kind to our Nasdaq 100 strategy as it recovered 9.5% from a recent correction. It is up 13.8% for the year. Our current leaders, the MYRS and 3x UIS strategies continue on to higher profits with July returning 8.6% and 7.8% respectfully. The World Top 4 strategy follows with 7.1%. The BUG leveraged added 3.7% and is up 15% for the year. Our core conservative UIS is at a respectable 12.9%. Looking at 3 month Sharpe ratios, we get a similar picture: The winners in risk adjusted performance are the UIS strategies, the Maximum Yield strategy, the BUG strategies as well as our Global Sector Rotation Low Volatility strategy (GSRLV). 

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