So What's the Weather Like Outside?
...well that depends on the time line.
Secular weather is strongly, and I mean strongly, in spring. Look for rising interest rates on both increases in growth and inflation. Secular conditions can run for a year or two with the current spring not quite a year old.
Cyclical weather varies twice as often as secular with up and down trends along the secular curve. Currently cyclical conditions are also strongly in spring, having broken out of a week of summer funk after the election.
Thirty Day weather varies frequently along the cyclical pattern, and is in winter, the opposite of both secular and cyclical.
So here's how the GA will use the conditions.
Secular weather = 50% of portfolio, currently favoring the best between TBF (a 'super' spring asset) and HYEM, with HYEM coming out on top earlier this week replacing TBF as the primary asset.
Cyclical weather = 50% of portfolio, or secondary asset, which may contain a 10% PALL holding if both secular and cyclical weather are in spring.
Thirty Day weather = allocation between seasonal assets and MM, currently 30 day weather has the spring season past peak and pointing to colder temperatures, with both growth and inflation moving lower.
Allocation = Secular 50% HYEM + Cyclical 40% HYEM + Cyclical 10% PALL minus 50% Thirty day downturn in growth minus 50% Thirty day downturn in inflation = OBFZ (one big fat zero) 0%
So what can happen next?
Well the Thirty day could reverse, and move me back into HYEM or TBF, or the Thirty day could stick around and affect the Cyclical moving me off both HYEM/TBF.
As always I don't have a clue how this will all play out.
