Worry less | Enjoy more
We invite you to call us to discuss how this data informs our strategy and how a ZENdex Portfolio could be a powerful addition to your overall investment mix. We weigh the data below heavily when developing our portfolio strategy, in which we aim to maximize the relationship between performance and protection while minimizing taxation.
ULTRA-CONSERVATIVE | BOND REPLACEMENT | GROWTH | MANAGED OPTIONS
S&P 500 RELATIVE TO ITS ALL-TIME HIGH
In previous Market Pulse Newsletters, we discussed how the metrics we track here pointed to a likely increase in volatility.
Last week, volatility spiked as the S&P 500 descended 12.37% below its all-time high. This decrease created a material opportunity for ZENdex portfolios, which we seized.
Such opportunities can help our clients be more quickly compensated for risk, among other benefits.
ZENdex portfolios are built to help withstand the things nobody can see coming.
S&P 500 RELATIVE TO ITS MOVING AVERAGES
The S&P 500 is below its 50-day moving average but remains above its 50-week and 50-month moving averages.
A return to its monthly average from the current price would require a 26% decline.
A ZENdex portfolio can help better position you when the S&P 500 reverts to its 50-month moving average.
TREASURY YIELD CURVE VS CONSUMER PRICE INDEX
With inflation high and interest rates low, bonds offer very poorly compensated risks.
As for equities, the opportunities there may be associated more with volatility than price appreciation.
That’s because inflation can compress the multiples at which equities trade, creating headwinds for common stock prices.
ZENdex portfolios are built to pursue the opportunities volatility creates.
THE PHILLIPS CURVE
In this dance in which the Federal Reserve tries to keep workers employed but with wages whose buying power isn’t destroyed by inflation, those in control of monetary policy cannot afford to have two left feet.
Historically, taming inflation has increased the risk of recession.
A ZENdex portfolio may better position you for this.
Subscribe to the Market Pulse Newsletter
- Source: thinkorswim desktop trading platform.
- Source: https://www.treasury.gov/resource-center/data-chart-center/interest-rates/pages/textview.aspx?data=yield
- The measure of inflation is the year-over-year change in the Consumer Price Index (CPI).Source: inflationdata.com
- We are displaying inflation as measured by the Consumer Price Index (CPI). It’s worth noting, however, that the Federal Reserve states its goal for inflation in terms of the Personal Consumption Expenditures (PCE), which is highly correlated to CPI but can generate different readings. The PCE can be found here: https://www.bloomberg.com/markets/economic-calendar. For more information on how CPI and PCE differ, you can go to: https://www.clevelandfed.org/newsroom-and-events/publications/economic-trends/2014-economic-trends/et-20140417-pce-and-cpi-inflation-whats-the-difference.aspx