"Hey, mister, can you tell me where a man might find a bed?"
He just grinned and shook my hand and, "No," was all he said.
Take a load off Anny
Take a load for free
Take a load off Anny
And you put the load right on me
American Rock & Roll lost a great one this month ... RIP Levon Helm The Band - "The Weight" (1968) Levon Helm Dead Age 71 (1940-2012) and a tribute by Bruce Springsteen 5:42 Watch Later Error The Weight - Springsteen - Newark NJ May 2, 2012by TheMagikRat2,828 views
Portfolio Alert-
Over the last couple of weeks, stocks, especially foreign stocks, are "feelin' about half past dead." Earlier this week we substantially lowered our weight in risk assets, and subsequently increased cash holdings from 8.5% to 19.5%.
Remember, job one here at Rockhaven is to protect our assets, which often means to sell first and ask questions later.
The big picture, or macro view, is one of suffocating debt loads, slowing economic growth, and extremely uncertain political environments. For a while global equity markets and most risk assets ignored these risks, and focused instead on the massive central bank intervention that lead to rising asset prices. It was a very good 1st quarter, but there is only so much the Fed and their global colleagues can do. Over the last several weeks we've seen a decidedly negative environment arise in all risk assets.
Not surprisingly we've seen many of our individual securities roll over in tandem, and go from bullish weights to neutral or even negative. While I clearly have views about the global economy and markets, I still rely on my indicators to control emotions and keep us in harmony with the markets. As of the end of March we had 8% in cash equivalents, we had 8.5% at the end of April, and after today's trades we're up to 19.5% in cash equivalents.
Tactical asset allocation is all about staying out of big drawdowns, and participating in long-term bull markets.
Here's where we stand today in our Global Tactical Asset Allocation Portfolios:
US Equities -- 25% Bullish,
we are now at our full US equity weight. The US equity markets have rolled over a bit (they are about 4% off their highs), but none of our technical indicators have broken, yet.
Int'l Equities -- 3% Bearish,
both developed and emerging equity markets have broken decisively. In fact they went immediately from bullish to bearish, subsequently our allocation fell from 20% to 3%.
US REITs -- 6%
Bullish, we are still at our full US REIT target of 6%. REITs continue to be a huge beneficiary of the Feds ZIRP.
Int'l REITs -- 4% Bullish, international REITs are in bullish territory, again benefiting from low rates, but they are approaching neutral territory.
Gold --7% Neutral, Gold is neutral and has been trading in a rather tight range, but it is approaching bearish territory.
Commodities -- 7% Neutral, the appearance of economic weakness has caused commodities to fall
. Unless current trends reverse we'd expect to be in bearish territory soon.
US Fixed Income -- 23.5% Bullish, US Treasuries have rallied to near record low yields again. High-yield bonds & MLP's are trending towards neutral. Overall US fixed-income is at 23.5% out of a maximum of 25%.
Int'l Fixed Income -- 4% Bullish, We continue to have zero exposure to European & Japanese bonds. Our entire exposure is Emerging Market bonds, which are still in bullish territory.
Cash Equivalents & Currencies -- 19.5%, cash levels have increased dramatically this week, and are divided between the US at 16.5%, and 3% in China.
In Summary - We took a load off...We significantly lowered our risk exposure, and if current trends continue we'd expect to get even more defensive.
If you'd like to sit down and talk about the markets, and your current risk exposure in more detail, please give me a call.
Be careful out there, and keep the lights on,
Chris Wiles, CFA
412-260-7917
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This article contains the current opinions of the author but not necessarily those of the Rockhaven Capital Management. The author’s opinions are subject to change without notice. This article is distributed for informational purposes only. Forecasts, estimates, and certain information contained herein are based upon proprietary research and should not be considered as investment advice or a recommendation of any particular security, strategy or investment product. Information contained herein has been obtained from sources believed to be reliable, but not guaranteed.
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