Market Risk Report as of November 1, 2021

From Chief Investment Officer Tom Veale,

“A week away from usual reporting, SignalPoint’s Market Risk Indicator is only slightly changed. The upward movement of stock prices relative to good earnings being reported through September, 2021 has raised the average Price for stocks a bit more than the earnings increases themselves. A bit more speculative activity indicates strong cash flow into equities as well. Overall, U.S. Domestic stock indexes rose over the latest two weeks.

Short term treasury rates have remained near zero interest and the FED, for now, has been unresponsive to the Consumer Price Index ticking upward. A small amount of inflationary cancer is being allowed while that segment of the population who live on fixed income continue to foot the bill.
The last two months of the year tend to have stock activity that relates to gains and losses. Investors tend to shed stocks that are ‘down’ for the year to offset gains taken on more attractive holdings. This consolidation usually pushes up stocks that are already ‘winners’ and further punishes those that are ‘losers.’ Our SignalPoint Process can be seen as being responsive to this annual behavior from a contrary point of view. All this is done while closely monitoring our Investment Strategies’ available reserves of cash.
Best regards,
Tom Veale
The MRI ticked up one point in the most recent week. Now showing 36, it is still more than one standard deviation above its median (26). The MRI Oscillator is showing +3 indicating modest upward market risk pressure.”

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