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Weekly Market Commentary

The midterm election results sent the financial markets on a roller coaster ride. An already nervous AI trade hit the panic button on the prospect of a significant slowdown in development of data centers and other AI related development. In an irony to the election results, the markets recovered some of their losses on Friday with the release of the October Jobs Report. It reported a much larger than expected 165,000 new jobs; when adding in the upward revision in jobs from the prior two months, that number increased to 249,000. It also showed the hot economy is bringing in more people to the workforce, yet the unemployment rate declined again. What went largely ignored was more strong growth in the manufacturing and services sectors which we believe .... (click for more)

Benefits of Tactical

CLIENT-CENTRIC INVESTING: 
UTILIZING TACTICAL MANAGERS TO IMPROVE RISK/RETURN

Characteristics of Client Portfolios

The most common method for building multi-asset portfolios is based on Modern Portfolio Theory (MPT). The biggest issue we have with this approach is that it is not aligned with most investors’ view of risk. MPT utilizes a process that seeks an efficient portfolio with a given level of risk measured by return volatility. This misalignment manifests itself when the market is down 36%, and a portfolio is down 33%. In this case, the manager is patted on the back (receives a bonus) for outperforming their benchmark, and the investor is out 1/3 of their investment…  (click for more)

Monthly Market Commentary

There are no more qualifiers* to the strong economic data, as the economy continued to report strong growth in October. While persistent inflation is an irritant to consumer sentiment, both consumer and small business confidence indicators remain at moderately positive levels, which is a reflection of that growth reality. The consumer’s “actions” also speak to that confidence with September’s headline and core Retail Sales soaring to stronger positive levels. Underpinning consumer strength is a solid job market, with the strong growth beginning to pull in more people to the job market, including the small independent and sole proprietor businessperson. Housing remains in the doldrums from higher mortgage rates, due to energy ...... (click for more)