With regained optimism surrounding trade talks between the U.S. and China all listed strategies have seen gains so far this month.  However, portfolios with exposure to fixed income securities (such as those listed as “Passive” in the chart below) have trailed 100% equity portfolios year-to-date as the stock market rallies back from its late 2018 correction.

Comments on this week’s report:

  • Year-to-date Sector Rotation has largely outperformed all other listed strategies as its high concentration in the technology and industrial sectors (which were among the top performing sectors in that time frame) has driven it higher.  However, for that same reason Sector Rotation has underperformed over the trailing 1-year period as its lack of diversification causes its returns to be more volatile and risky.
  • Contrary to Sector Rotation, Low-volatility is outperforming all other listed strategies by a large margin on a 1-year basis as it benefited from its relatively lower drawdown during the stock market correction at the end of 2018, while still participating in the more recent stock market rally.
  • Quality based equities (which are measured on ROE, accrual ratio, and financial leverage) have performed relatively well in all time frames as it remains at the top of the heap. 
  • Momentum based equities have outperformed over the trailing 3-year and 5-year periods as during those time frames the stock market has primarily experienced upward momentum.
Important Disclosures:  Please remember that past performance may not be indicative of future results.  Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly from The Market Commentator℠, will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio.  Due to various factors, including changing market conditions, the content may no longer be reflective of current opinions or positions.  Moreover, you should not assume that any discussion or information contained in The Market Commentator℠ serves as the receipt of, or as a substitute for, personalized investment advice from The Milwaukee Company™.

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