The Day Hagan/Ned Davis Research Smart Sector® with Catastrophic Stop strategy entered this month recommending a 50% cash allocation. The NDR Catastrophic Stop model is based on the combination of two proprietary composites: 1) the Internal Composite (technical and price-related indicators) and 2) the External Composite (fundamental, economic, interest rate, and behavioral/sentiment indicators). Each composite is one-half of the overall score.

This month’s allocation to U.S. equities is overweight Energy, Consumer Discretionary,  Consumer Staples, and Information Technology. The model is underweight Materials, Industrials, Financials, and Communication Services. The sector allocations are determined using NDR’s Sector Model, where each sector has sector-specific, weight-of-the-evidence composites of fundamental, economic, technical, and behavioral indicators to determine the sector’s probability of outperforming the S&P 500.

Click the link below to read more about the strategy’s positioning.

Full strategy commentary: NDRSASDH202208041

Visit the Day Hagan research page for access to additional commentary and webcasts.

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Thoughts From The Divide: Tricks

BY JON WEBB
Perhaps it’s just us, but as the spooky season returns and jack-o-lanterns bedeck porches, we notice that markets and commentators also seem a bit skittish. Maybe it’s the looming election, or perhaps the geopolitical horror shows, but folk seem surprisingly easy to spook. Case in point was the hullabaloo around the $44bn jump in US (government) debt. The hue and cry of folk such as ZeroHedge were enough to get more mainstream interest, including the owner of X and a son of FP Trump, to take notice. The jump is seasonal, as Constan and others pointed out, rather than some ghoulish trick, but of course it’s easy to make fun of those who took fright. But perhaps this misses the point about horror movies. Some argue that the genre works for some because it allows them to push their boundaries and learn the limits of their fears. If that describes you, we recommend reading the CBO Long-Term Budget Outlook. For others, referred to as “dark copers”, the appeal of horror movies might lie in “anxiety or fear that they’re feeling in their life, and they use scary genres like horror to kind of work through those feelings”. Read more →
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