Here is an update for Old_Skeet's market barometer (which follows the S&P 500 Index) for the week ending April 5, 2019 along with my thinking and plan.
Old_Skeet being a retail investor provides this information for information purposes only. It simply reflects what I am seeing in the markets, my thinking; and, my plan of action along what has worked best within my portfolio for the past week. It should not to be taken as investment advice.
For the week Old_Skeet's market barometer closed with an overbought reading of 135 which is down from last week's overvalued reading of 141. Generally, a higher barometer reading indicates that there is more investment value in the Index over a lower reading. Short interest in the Index, for the week, remained at 1.8 days to cover. The yield on the US10Yr moved from about 2.4% up to just short of 2.5%. The 500 Index moved upward from 2834 to 2893 for about a 2.1% gain for the week as money has now begun to flow back into stocks as some investors sold bonds and bought stocks. Perhaps, some investors are just too optimistic about the upcoming first quarter earnings reporting season that soon begins. For Old_Skeet, I'm not presently putting new money to work in either my stock or bond funds while I await a higher barometer reading indicating a better investing climate for stocks; and, I'm also awaiting better yields from bonds.
For the week my three best performing funds were all found in the Growth & Income Area of my portfolio. They were DWGAX +3.05% ... FDSAX +3.03% ... and, EADIX +2.56%.
I am invested in what I call an "all weather" asset allocation which consist of about 20% cash, 40% income and 40% equity. The benefit of this asset allocaton, with me being in the distribution phase of investing, is that it provides sufficent income, maximizes diversification, minimizes volatility, and provides long-term returns.
I most likely will add to the equity side of my portfolio during the next good stock market meltdown as I can tactically overweight my equity allocation by up to +5%. Before overweighting equities, with a special investment position (spiff), I'll need to see a sizeable rise in my barometer reading as a higher barometer reading indicates there is more investment value in the 500 Index over a lower reading. Currently, by the metrics of the barometer, stocks are overbought. And, if corporate earnings and revenues disappoint a sizeable pullback in stocks most likely will be coming.
I'm also thinking that most of the gains have already taken place, for stocks, with the Index being up thus far this year by 15.4%. My target for the S&P 500 Index, before year end, is somewhere around 3,000. This will only add about another 4% of gains from the present level ... and, we've got nine more months to go before year end. So, a lot can happen.
For now, though, I'm in a plain old just sit back and watch "the action" mode. I'm thinking big money has run stock valuations upward so they can cut and run ... book some profit in the process ... and, then buy the market again at better prices as the weaker investor begins to sell during the anticipated stock market downdraft. Hey, this has happened many times before as it seems to be part of many investor's reactions to stock market declines. Naturally, it may take some time for this thinking and my plan of action to play out; but, I look to see it take place sometime during the year.
For me, I've got some dry powder while I sit, I watch ... and, I await for a good buying opportunity to open a special equity mutual fund "spiff" position.
Thanks for stopping by and reading.
I wish all ... "Good Investing."
Old_Skeet
Trailing Comment: For those that would like to reference the March Barometer Report along with my prior weekly comments just click on the below link. You can also view my weekly fund leaders. Interestingly, in most weeks something different lead although there were a couple of repeats.
https://mutualfundobserver.com/discuss/discussion/47961/old-skeet-s-market-barometer-report-thinking-march-1-2019-a-3-29-update#latest 
Comments
Thx
My portfolio back then was configured much different than it is today.
Regards thx for the post
https://www.mutualfundobserver.com/discuss/discussion/24926/old-skeet-s-new-portfolio-asset-allocations-2016#latest
I'll keep looking and if I come up with something else I'll post it.
And, here is something else that I came up with that dates back to March of 2012 as how I went about adjusting my asset allocation. Perhaps, it will be of some interest.
https://www.mutualfundobserver.com/discuss/discussion/2501/a-system-i-use-to-adjust-my-asset-allocation#latest
As you can see through the years; and, as I have aged, I have reduced my allocation to equities and raised my allocation to income while cash has stayed about the same except when I was positioned for the 2009-2010 stock market rebound. Back then cash was at about 10%. One reason that I hold excess cash is that it provides me the opportunity to open special equity spiff positions form time-to-time should I feel this is warranted. This is something that I have done for a good number of years ... and, I still do form time-to-time. However, I did not put a spiff in play during the last market swoon (4th Quarter of 2018) as I was in the process of rebalancing and reconfiguring my portfolio. Howerver, I did leave myself +5% equity heavy during this last rebalance process to tactically overweighting equities from my newely established asset allocation of 20% Cash, 40% Income, 30% Gr & Inc and 10% Growth. With this, my Growth Area is now +5% heavy while my Cash Area is -5% light from their neutral positions due to this tactical overweight positioning in equities.
Old_Skeet being a retail investor provides this information for information purposes only. It simply reflects what I am seeing in the markets, my thinking, along with what has worked best within the Index and within my portfolio for the past week. My thoughts and my positioning should not to be taken as investment advice.
For the week Old_Skeet's market barometer closed with an extremely overbought reading of 128 which is lower from last week's overbought reading of 135. Generally, a lower barometer reading indicates that there is less investment value in the Index over a higher reading. Short interest in the Index, for the week, remained at 1.8 days to cover. The yield on the US10Yr moved from just short of 2.5% up to 2.57%. The 500 Index moved upward from 2893 to 2907 for a 0.48% gain as more investors bought stocks. The three best performing sectors were Financials +2.09%, Telecom Services +1.55% and Information Technology +1.16%. For Old_Skeet, I'm not presently putting new money to work in either my stock or bond funds while I await a higher barometer reading indicating a better investing climate for stocks; and, I'm also awaiting better yields from bonds. Currently, by the metrics of the barometer, stocks are extremely overbought. And, if corporate earnings and revenues disappoint, this earning season, then a pullback in stocks most likely wil be taking place.
For the week my three best performing funds were PCLAX +1.28% ... PMDAX +1.18% ... and, NDVAX +0.91%.
I am positioned in what I call an "all weather" asset allocation which consist of about 20% cash, 40% income and 40% equity. The benefit of this asset allocation, with me being in the distribution phase of investing, is that it provides for ample cash reserves, sufficient income, maximizes diversification, minimizes volatility, and provides long-term returns. I'm currently heavy in stocks by +5% and light in cash by -5%.
Thanks for stopping by and reading.
I wish all ... "Good Investing."
Old_Skeet
"Old_Skeet's market barometer closed with an extremely overbought reading of 128 which is down from last week's overbought reading of 135. Generally, a higher barometer reading indicates that there is more investment value in the Index over a lower reading.
..."I'm not presently putting new money to work in either my stock or bond funds while I await a higher barometer reading indicating a better investing climate for stocks; and, I'm also awaiting better yields from bonds. Currently, by the metrics of the barometer, stocks are extremely overbought..."
My conundrum is: 128 is a LOWER number than 135. Come again, please?
Old_Skeet being a retail investor provides this information for information purposes only. It simply reflects what I am seeing in the markets, my thinking, along with what has worked best within the Index and within my portfolio for the past week. My thinking, my positioning, or my comments, should not to be taken as investment advice.
For the week Old_Skeet's market barometer closed with an overbought reading of 138 which is up from last week's extremely overbought reading of 128. Generally, a higher barometer reading indicates that there is more investment value in the Index over a lower reading. Short interest in the Index remained at 1.8 days to cover. The yield on the US10YrT moved from 2.57% to 2.56% while the yield for the Index (SPY) remained at 1.85%. The 500 Index moved downward from 2907 to 2905 for a slight loss. Trading volumes are below their averages as investors ponder stocks. There will be close to 100 companies reporting earnings this coming week, within the Index, so it will be interesting to see how the coming week progresses. The three best performing sectors, for this past week, were Industrials +1.59%, Technology +1.44% and Consumer Staples +0.96%. For Old_Skeet, I'm not presently putting new money to work in either my stock or bond funds while I await a higher barometer reading indicating a better investing climate for stocks; and, I'm also awaiting better yields from bonds. Clearly, by the metrics of the barometer, stocks are overbought.
For the week my three best performing funds (all having a global perspective) were LPEFX +1.59% ... TIBAX +1.44% ... and, DEQAX +1.44%.
In addition, I'm pondering another portfolio rebalance as I had a couple of large cash draws coming from my portfolio's cash area the past week to pay Federal & State Income Taxes owed plus I made a contribution to my church's capital fund drive campaign. This has now left my portfolio's asset allocation skewed and cash light. Since, I am equity heavy I'll be trimming equities and raising cash by a like amount in the near term. My late father had a saying, back in his day, "When the yields get thin, it's time to trim." Within the past six months, or so, the yield on the US10YrT has moved from 3.23% down to 2.56% while the yield for S&P 500 Index has moved from about 2.1% down to 1.85%. I'm thinking, the yields are now thin; and, also based upon historical seasonality trends (that he also followed), it is indeed time, for me, to trim equities.
From my perspective, investing is not an exact science and relies a lot on skill centering around the art of making a call. It's the many different investment perspectives of investors that make the markets. This is why I feel it so important to be well diversified and follow modern portfolio theory. And, furthermore, investing is really quite simple. In order to get the average return of the market you have to invest at its average price. Want above average returns? Then put new money to work at below the market's average price. This is where my market barometer helps me find good value and the better times, for me, to put new money to work. This is why buying the dips have become a popular investment strategy. Thus a phrase was coined ... "Buy the Dips and Sell the Rips." Coming off the Christmas Eve and December low the Index is up about 25%. Seems, this qualifies as a "Rip." And, for me, it's time for another rebalance.
Thanks for stopping by and reading.
I wish all ... "Good Investing."
Old_Skeet
Old_Skeet being a retail investor provides this information for information purposes only. It simply reflects what I am seeing in the markets, my thinking, along with what sectors have worked best within the Index and my best performing funds for the past week. My thinking, my positioning, along with my comments, should not to be taken as investment advice.
First quarter earning season is now well underway with about 25% of the companies within the Index reporting. Thus far, earnings are far better than expected while revenues are falling short. For the week Old_Skeet's market barometer closed with an overbought reading of 138 which is the same as last week's reading. Short interest in the Index moved from 1.8 days to 2.3 days to cover as some investors have increased their short positions during the week. The yield on the US10YrT moved from 2.56% to 2.50% while the yield for the Index (SPY) remained at 1.85%. The 500 Index moved from 2905 to 2940 for a gain of 1.2% for the week. Trading volumes remain light and below their averages as investors continue to ponder stocks while many investors seek the safety in bonds. The three best performing sectors, for this past week, were Health Care +3.66%, Telecom Services +2.69% and Consumer Discretionary +1.42%. For Old_Skeet, I'm not presently putting new money to work in either my stock or bond funds while I await a higher barometer reading indicating a better investing climate for stocks; and, I'm also awaiting better yields from bonds. Clearly, by the metrics of the barometer, the Index is overbought.
For the week my three best performing funds were AOFAX +5.31% ... SPECX +3.21% ... and, KAUAX +2.68%. For the month the three best performing were SPECX +6.17% ... NDVAX +5.35% ... and, LPEFX +5.33%. In compairson, the S&P 500 Index was up 1.20% for the week and 4.31% for the month.
I'll be moving back to monthly reporting starting in May. For me, summertime is calling and Old_Skeet is going to follow an old seasonal trend, again, this year, where I reduce my investing activity towards the beginning of summer and then begin to get more active sometime around Labor Day. I'm still with my plan to trim equities and raise cash during the next few weeks as my asset allocation is presently equity heavy and cash light.
Thanks for stopping by and reading.
I wish all ... "Good Investing."
Old_Skeet