A pattern has developed over the past 15 years. The market swoons, triggers a sell signal, gathers itself together for one more run and then declines.
We have seen the recent swoon and sell signal and are in the middle of the run. The next step could be a decline.
The only questions is – When?
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Below are our ratings for asset classes and sectors
O – Overweight S/T – Short term (< 6 mos)
U – Underweight I/T – Intermediate Term (6 mos – 24 mos)
S – Sell/Short L/T – Long Term (> 24 mos)
H – Hold
Meaning and Distribution of Ratings:
O – Overweight – Asset class we anticipate to have a higher allocation within the CIS Model portfolio. We anticipate Overweighted asset classes to out-perform.U – Underweight – Asset class we anticipate to have a lower allocation in the CIS Model portfolio. We anticipate Underweighted asset classes to under-perform. S – Sell/Short – Asset class we believe is overvalued or anticipate to have negative performance. H – Hold – Asset class we don’t expect out-performance from, but don’t expect under-performance from either.
CIS allocations are not based on the S&P 500 or other market indices, but according to CIS internal research. CIS will shift asset allocations according to our internal research, short term, intermediate term and long term cycles and trends.
No guarantee in given or implied that any asset class will perform as expected.
This information is for application to CIS managed accounts and opinions may change without prior notice.
*Note on Ratings:
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Technical Analysis/Research – “A method of evaluating securities by analysing statistics generated by market activity, such as past prices and volume. Technical analysts do not attempt to measure a security’s intrinsic value, but instead use charts and other tools to identify patterns that can suggest future activity.” – Investopedia
Additional Significant Risk Factors and Investment Considerations
The securities or trading strategies discussed in this report may not be suitable for some investors. Investors must independently evaluate each issuer, security, or instrument discussed in this report and consult independent advisors where necessary.
1. Past Performance is not indicative of future results.
2. Market Risk: Securities may decline in value due to factors affecting securities markets generally or particular industries. The value of a security may be worth less than the original investment.
3. Concentration risk: Investing a substantial portion of assets in securities within a single industry or sector of the economy may be subject to greater price volatility or adversely affected by the performance of securities in that particular sector or industry.
4. Leverage Risk: Fluctuations in interest rates on borrowings or the dividend rates on preferred shares as a result of changes in short-term interest rates may reduce the return to common shareholders or result in fluctuations in the dividends paid on the common shares. There is no assurance that a leverage strategy will be successful.
5. Foreign Investment Risk: Investment in foreign securities (both governmental and corporate) may involve a high degree of risk. In regards to debt securities, such risks may impair the timely payment of principal and/or interest.
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