Market Update: 05-30-18

The Issachar Fund (LIONX) is 50% invested as of Thursday, May 24, 2018. Here are the ETF themes that LIONX owns: Russell 2000 Value (11%), S&P Small-Cap (9%), Commodity Tracking (9%), Energy (6%), US Medical Devices (5%), US Dollar (5%) and Mid-Cap (5%). I was somewhat encouraged last week as the LIONX positions increased in value but then the market took a breather in anticipation of Trump cancelling the North Korea Summit. The market was gearing up for a favorable outcome at the Summit and now “uncertainty” is creeping its ugly head again. I believe Trump will eventually win the negotiations with North Korea and the market will rally to new highs but not without more price volatility I do not like the way Energy and Commodities are acting as they chip-away at recent gains. It seems that the algo-traders are punishing the recent winners and that is not a good feeling, if you know what I mean. Commodity ETFs were doing well but now they too are sliding south with Oil/Energy. There are times to draw a line in the sand and certainly act accordingly when the line is crossed. If risk is not managed properly, it could lead to life-changing decisions which is typically not a pleasant conversation. My advice is to make sell decisions (draw a line in the sand) before you buy so that you are not emotionally attached to a bad trade that could ruin your portfolio. There is currently […]

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Market Update: 04-24-18

  The Issachar Fund (LIONX) is 8% invested as of Friday, April 20, 2018. I purchased 10 ETFs this week that looked promising based on some volume and chart patterns I was seeing. In hind-sight, they did not perform well and produced losses I was not comfortable with given the current market environment, so I sold them. LIONX is currently holding two ETF positions in the Energy (5%) and Cyber Security (3%) space. It initially appeared that the market wanted to head higher on good earnings announcements. However, the tide turned when unfavorable news from Apple rippled through the Tech sector and that put a drag on the over-all market. 10-Year Treasury Yields rose to a 4 year high as inflation expectations rose to the highest level in about 3 years. The Fed continues to reduce its $4.5 trillion balance sheet by selling bonds it accumulated during the financial collapse of 2008.  It will likely drain liquidity in the market and that will likely cause further price declines since there is less money in circulation to bid up stock and bond prices. My focus remains on risk-management simply because Bear Markets are un-bearable. Bottom line, it seemed like investors had an early appetite for “risk” as Junk Bonds traded above its 50-day moving average but now they appear to be in hiding so buyer beware.  (Portfolio holdings are subject to change at any time and should not be considered investment advice. There is no guarantee that any […]

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Market Update: 03-15-18

       The Issachar Fund (LIONX) is 35% invested as of 3/15/18.  LIONX holds 5% positions in each of these 7 ETF sectors: Innovation, Information Technology, Dow Jones Internet, North American Tech-Software, S&P Mid-Cap, Extended Market and Cloud Computing.  These positions have not been profitable for LIONX, so I stand ready to cut losses as needed.  While the S&P 500 Index has retraced most of its recent loss, I do not believe we are out of the woods yet.  The Merrill Lynch High Yield Index is trading below its 50-day moving average and that tells me that investors do not have an appetite for risk taking so caution may be at hand.  The market has been stuck in a trading range and it may be trying to re-establish a new up-trend, but we may need a little more time before the old highs are taken out.  I believe that 1st quarter earnings will be better than expected and the market will break out of this trading range.  However, I will act on what the market does instead of what I think it should do.  The low volatility price trend we experienced in 2017 may be over and we may have to accept higher volatility going forward.  I am not convinced that will be the case, but I am prepared to handle higher volatility.  However, I will not abandon my risk-management principles that have helped to keep me out of major declines since 1990.  Remember, it was […]

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Market Update: 03-02-18

     The Issachar Fund (LIONX) is 100% in CASH, as of 3/1/18.  I sold half of the Issachar Fund’s ETF positions on 2/27/18 and then I sold the remaining positions on 3/1/18 due to market price deterioration and volatility.  The S&P 500 Index was up 7.4% in January then it dropped 10.1% in February and now it is about flat for the year.  This kind of volatility is very hard to manage, and it should not be ignored.  I do not like losing money, so I try to error on the side of caution and heed the warning flags as I see them.  If the market is not rewarding me for taking risk, then I prefer to sit in cash and patiently wait for the next opportunity.  Sometimes, you win by not losing.  (Portfolio holdings are subject to change at any time and should not be considered investment advice. There is no guarantee that any investment will achieve its objectives, generate positive returns or avoid losses.) President Trump vowed to impose steel and aluminum tariffs to protect U.S. workers and that sent the markets reeling in fear of “trade wars” with our trading partners.  I do not believe we are headed for “trade wars” because Trump is a smart business man and he will do what it takes to Make America Great Again.  However, the market may decline to possibly test a level of support at the February 8th low which is about 4% lower.  […]

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Market Update: 02-16-18

     The Issachar Fund (LIONX) is 80% invested in various Equity ETFs as of 2/16/18.  The Fund owns 8 ETFs (10% each) across several themes that seem to be under investor accumulation.  These ETF themes include: USA Momentum, USA Quality, US Banks, US Growth, Internet, Aerospace & Defense, Emerging Markets and Dividend Appreciation.  I sold the 30% ETF position recently purchased as it rolled over with the general market correction.  One advantage of a small mutual fund like LIONX is its ability to move in an out of the market without making big waves.  A pirogue can tack and turn faster than a cruise ship if you know what I mean.  I believe that the 10% Index correction is over, and I am actively seeking to purchase new ETF leaders as they emerge.  I also believe that it will be harder to make money in any type of bond or income producing investments now that rates are rising.  The Floating Rate position was sold because the cost of leverage increased to a level that did not justify the return LIONX was receiving.  Now would be a good time to reflect on how your investments faired in this recent scare.  As you may have figured out, I do not plan to buy and hold anything because trends change, and I hate losing money.  I am diligently seeking to stay in-tune with the major up-trends and avoid the major down-trends in order to have a chance at […]

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Market Update: 01-31-18

     The Issachar Fund (LIONX) is fully invested and leveraged (150%) in various   Equity ETFs (30%) and a Senior Floating Rate Mutual Fund (120%) as of 1/31/18.  The Fund owns 3 ETFs (10% each) across a few themes that seem to be under investor accumulation.  These themes include: USA Momentum, Value and Convertible Securities.  I sold all LIONX’s ETF positions last Friday as the market peaked and I bought back the current 30% in ETFs on Wednesday.  If I am wrong and these positions roll over with a continued market sell off that started on Monday, then I will not hesitate and sell these positions.  I added another 30% to the Senior Floating Rate position in LIONX as money continues to flow into this space.  I believe that the current double-digit trend in the Floating Rate space is sustainable.  Money still appears to be aggressively flowing out of Bonds and Utilities and I believe that the 35-year bull market in bonds may be over as interest rates continue to rise and the Fed reduces its Balance Sheet.  Historically, the stock market has been a forward looking discounting mechanism and it has been telling me that equities may be the “new bonds”.  That was hard for me to accept after 28 years of making most of my profits in bonds, but I have accepted this new reality.  Even though LIONX will likely have more equity and less bonds going forward, I am still very committed to […]

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