TrendCalc Market Insights
Monday, the S&P500 got March off to a positive start (+2.38%, +4.17% YTD) which is a welcome contrast to the way it finished February last week. Sectors and asset classes were mostly positive across all markets. Bonds, especially long maturity Treasuries (-1.17%) and Gold (-0.84%), were some of the few exceptions. Energy (+2.19%), energy services (+4.77%), and banking (+3.42%) continue to be some of the best performing sectors for 2021.
All TrendCalc model portfolios were positive Monday with TrendCalc’s top tier Wealth Creation portfolios growing their strong performance gap over the S&P500. TC Sectors and TC TINS continued strong performance leadership with year-to-date returns of +12.05% and +11.90% respectively. 2 months and 1 day into 2021 doesn’t prove anything, but we are pleased in our defined process producing (exceptionally) successful returns vs benchmark indexes and Conventional Wisdom’s passive BaH (buy-and-hold) average-averaging.
Our macro concerns:
- Fed (and other central banks) action and manipulation
- Government leadership and decision-making in battling COVID
- Growing likelihood of increasing inflation from macro concerns 1 & 2
Many years ago, as a professional challenge, we set out to find qualified answers to the passive/active strategy debate. In doing our own research, it was fairly easy to see that both, passive and active, can have their strategy benefits and shortcomings. Depending on the present economic environment (domestic and worldwide) and the various capital market conditions, both had periods where they were the strategy of the day, performing much better than the other. But both also had periods where they not only underperformed, but were outright losers for investors. This is that expected ebb-and-flow of under- and over-performance.
So, what started as a quest for an “either/or” answer to the passive vs. active conundrum, concluded with “and/all” multidimensional strategy solution(s). Instead of being entrenched in one-side of the passive/active debate (or any debate) and defending it as THE only Strategy of merit, we saw great merit in combining various passive and active strategies into a variety of standalone portfolios that could take advantage of the benefits of passive and active investing. We believe these strategies are some of the best in the business and should always position client portfolios and total wealth for much better grow-and-preserve, risk-vs-reward outcomes.
If you or your source of financial advice are so entrenched in Conventional wisdom’s one-size-fits-all strategy solution and do not understand the importance of incorporating a multi-strategy, multi-dimensional approach to your investment and retirement plans and portfolios, then maybe it is time you talk to a true market professional who does.
Philip S. Hammond, CFP®
Managing Director/Chief Portfolio Strategist
This material is not a recommendation to buy, sell, hold, or roll over any asset, adopt an investment strategy, retain a specific investment manager, or use a particular account type. It does not take into account the specific investment objectives, tax and financial condition or particular needs of any specific person. Investors should discuss their specific situation with their financial professional.
Except where otherwise indicated, the views and opinions expressed are those of TrendCalc as of the date noted, are subject to change at any time and may not come to pass.
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