Friends, Family, Clients,
The market’s charts look worse than the actual numbers. The S&P 500 is down 4.62% from its all-time high. While not catastrophic, it’s a significant drop. As usual, we’ve adopted a defensive stance to protect our substantial SPXL gains by equally increasing our SPXS (short) position. Additionally, we hold four sub-sectors that have outperformed in the past ten days: KRE (regional banking), IJS (small-cap 600 value), XHB (homebuilders), and IJR (small-cap 600). These sectors exhibit strong charts and fundamentals and diverge from the broader indices.
This market environment reinforces the necessity of sector and sub-sector expertise when traditional 60/40 portfolios falter. It’s disheartening to see millions still relying on Vanguard, Fidelity, and Blackrock’s one-size-fits-all approach. (Please refer to “JPMorgan Monthly Guide to the Markets, page 4”.) It’s astonishing how many people repeatedly ignore history and the potential for recurring market cycles.
Please don’t hesitate to contact me with any questions.
Best regards,
Jack
