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John Serrapere publishes a weekly newsletter which includes in-depth research, charts & graphs and insights into current and past markets. Click the below links to view a preview of what the weekly inFocus newsletter has to offer. To view this week's entire newsletter as well as all past newsletters, you must create an account. 

Highlights

Inflation Risk Dominates
November 9, 2021
This week, three alternative versions of the S&P 500 Index (SPX) are InFocus: the traditional capitalization (Cap)-weighted SPX, the equal-weighted, and the reverse-cap-weighted version.

Volatility Will Rise
September 21, 2021
For the rest of 2021 and beyond, markets are going to be very volatile. The Fed is going to make money worth less. How do we hedge? When stocks are at a reasonable value, they are a hedge against high inflation.

The FED Is Complacent or Clueless on Inflation Risk!
February 18, 2021
Arrow Insights favors global assets, moderate risk asset allocations and managed futures. Our investment rationale is based upon sustained weakness in the U.S. Dollar ($USD) attributable to yield repression policies enforced by the U.S. Federal Reserve (Fed) and excessive money supply growth due to money printing.


InFocus

Traditional 60/40 Vs. Balanced Global Macro Portfolios
May 24, 2022

Normal is nebulous. The 2000-2019 Normal was much worse than the 20th Century Normal!

Introduction
Arrow Insights (AI) conducts research for the weekly InFocus. AI reviews economic and market factors relevant to specific financial markets. Each InFocus reviews asset classes and index performance within the context of asset allocation. The primary or secondary objectives are hedging inflation, deflation, or both. Each InFocus reviews a portfolio strategy model or index relevant to this process.

This week, the traditional Domestic Balanced Portfolio and the Dorsey Wright Balanced Allocation Model (DWAB) are in InFocus. DWAB’s strategy employs a relative strength to identify top-performing global assets primarily within fixed income, equity, and commodity assets. As of May 1, 2022, the model was allocated: 47% to stocks, 30% to fixed income,13% to a commodity index, and 10% to a managed futures strategy. DWAB is positioned well for the latter stage of an economic recovery—dominated by inflation risk, as evidenced by its 60% allocation to late-cycle equity sectors, fixed income securities, and commodities. DWAB holds 30% in short-duration Treasury notes, Treasury Inflation-Protected Securities (TIPS), and ultra-short-maturity T-bills and commercial paper (CP). The portfolio balance has 60% in long-duration assets: stocks, commodities plus 10% to Dunn DWA Managed Futures Strategy (DWMA). 

 

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