We email the status of our WealthProtect System* monthly and give the probability (Low, Mid, High) of a change in status within the next two months. We also include a commentary on actions taken this month.
Asset Class Status Probability of Status Change
US Equities In Low Developed Foreign Equities In Low Emerging Foreign Equities In Mid Real Estate Investment Trusts In High Natural Resource Equities In Mid Commodities Out High Energy MLPs In Low
Our system triggered back into emerging markets and REITs, while the commodities asset class was still out. US equities continued their outperformance, especially for smaller capitalization stocks year to date (as measured by the S&P 500 and Russell 2000). We took this as an opportunity to rebalance client portfolios. While by some measures US equities continue to appear fair or undervalued, by several longer-term measures US stocks seem overvalued. We will continue to stay fully diversified, using our WealthProtect System to help us potentially avoid bear markets. That being said, we are seeking to reduce the sensitivity of the triggers for the more volatile asset classes in order to attempt to reduce false signals.