From Chief Investment Officer Tom Veale,
Checking one’s facts should be easy in our modern, electronic information age. Checking more than one source for those facts is a good idea still. Sometimes our favorite information sources or sites are not up-to-date. I was reminded of this early today when looking at apparent yields on some income investments. Data from two different sources showed entirely different yields. Getting the correct yield estimate provided a very different picture than the out-of-date estimate. In personally collecting data on the stock markets since the start of 1982, it’s been rare that there have been errors but it’s still good to double check things.
There’s no need to double check the SignalPoint Market Risk Indicator this week. It’s unchanged from a week ago even though the internal components shifted around.
The MRI remains less than a standard deviation away from its median value and is close to where it was at the start of 2023. If the markets called it quits for 2023 today, investors would have done reasonably well. The second half of 2023 will have its own challenges and SignalPoint will be following the situation closely.
Shorter term Treasuries still offer reasonable yield compared to longer maturities. All still are below the inflation rate, but not by much. Value Line’s median yield for dividend paying stocks shows 2.2%/yr and is well short of the 13 week treasury yield. That always has to be weighted with the “Total Return” scale as stocks are not ‘fixed income’ investments. Does future stock gain potential compensate for the apparent lower dividend return?
As the market sectors shift in priority and popularity, SignalPoint’s Process continues to follow the trends and act prudently.
This week the MRI shows up as 31, unchanged from last week. The MRI Oscillator is also unchanged at +2, showing modest upward risk pressure in the markets. Two components rose and two fell in risk profile leaving one “cautious” and one “proactive.” It all balanced out to ‘no change’ overall.