May 2020 Monthly Newsletter - Performance Update & ThoughtsSubmitted by Elite Asset Management on May 4th, 2020
It's been an interesting couple of months for the market, from a strong sell off to a strong bounce that left the S&P only down -9.29% for the year. Our strategies are doing quite well and are right around break even for the year, and were beating the S&P by 8-9% depending on the strategy. The worst of our strategies is the minimum volatility strategy, which is down -6% and this was due to bonds selling off and with the least equity exposure the strategy didn't perform as strongly. Just as I predicted we saw emergency actions taking by the Fed which cut rates to zero among other actions to save the bond market. The probability of the Fed being able to raise rates again are quite small and we just need to look at Japan as an example.
I don't believe that as investors we need to be all in the market or out of the market, nor do I believe that we need buy and hold. I now that will offend a lot of people who strongly beleive that buy and hold is the only way. Just as in life the truth can often be found in the middle. One of the many benefits of my passively active strategy is that we adjust to market conditions based on price action, and this can happen anytime during the month, not just at month or quarter end. We're long term, medium term, and short term at the same time just in different parts of the strategy and they all must work together. This is the balancing act of my passive active investing philosophy and why my strategies follow a core-satellite approach to investing.
On a personal note I hope everyone is staying safe and taking all the necessary precautions. It's a different world that we're living in and just like my strategies we need to adjust to the changes of the world around us.
As we watch the markets move up and down, it's easy to become emotions however, our strategies are designed to last for decades not days.
The best way to reach me is to send me an email at firstname.lastname@example.org
Until next month.
John A. Eiduk, CPA, CFP™
What is S.M.A.R.T Asset Allocation?
We created a rule-based investment process that is S.M.A.R.T. As the investments are Strategic, helps our clients Maximize Gains, Adapts to current market conditions, manages Risk, and is Tactical.
It's still asset allocation only S.M.A.R.T-er.