The Day Hagan/Ned Davis Research Smart Sector® with Catastrophic Stop strategy is cautious and holds 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, Health Care, Materials, Industrials, Staples, and Utilities. The model is underweight Consumer Discretionary, Information Technology, 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: NDRSASDH202202021
Visit the Day Hagan research page for access to additional commentary and webcasts.