Market Insight September 5, 2022

In this weeks Market Insight we check out the Blitz Index and recent stock market action.

Blitz Index

What is it? 

We use the Blitz Index to better understand the stock market environment. That is done by looking at lending rates, changes by the Fed, and consumer debt. By combining those indicators with the past performance of the market we can paint a picture of where the economy is and how it could evolve in the future. 

Why does it matter?

We did not have a change from last month to this month. As of writing this on Thursday September first, we are at a 4/10 on the Blitz Index. We believe that the Blitz Index may stay bearish until the Federal Reserve pivots into more accommodative monetary policies. 

What matters is that we are not changing our allocations much due to the Blitz Index staying relatively unchanged. We are holding a considerable amount of cash or money market funds as markets may have re-entered a downtrend. 

Markets Were Not Overbought for Long 

What is it? 

As we mentioned in a recent Market Insight, stocks were overbought. People on the buy side may have had a fear of missing out as there was a brief rally higher. However, we adjusted our portfolios throughout August to reflect the overbought viewpoint we maintain. Stocks did not remain elevated for long as shown below. 

StockCharts.com

That is the Year to Date chart of VT (the Vanguard World Stock ETF) as of the close on Thursday, September first. 

Why does it matter?

The arrow is used to show when VT was overbought for a few days. As you can see stock prices around the world have declined since then. We did lower our stock market exposure that week which helped us protect portfolios as the market continued its decline.

Other articles we found interesting this week:

The stock market has tanked since Jerome Powell’s Jackson Hole speech. That’s how the Fed wants it

History points to more challenges ahead for the stock market: Morning Brief

New U.S. curbs on sales of Nvidia AI chips to China spark selloff

Current 401(k) portfolio

Our last portfolio reallocation: 5/19/2022. 

Want more information?

The weekly market insight provides a window into the process we use in our investment management process. At Breakaway, we believe markets are always changing and require a nimble yet data-oriented approach. 

Our process attempts to identify trends and momentum in the financial markets. With that information, we align our clients’ portfolio accordingly in the hope to help our clients accomplish their life goals while attempting to lower the risk of a large drop in their portfolio.

Click here for more details about our investment management 

IMPORTANT DISCLOSURES: 

Educational use Only. The market update published by Breakaway Financial Group LLC (“Breakaway”) is intended to be educational in nature and is not intended to be a recommendation for any specific investment product, strategy, plan feature or other purposes. Accordingly, it should not be construed by any consumer and/or prospective client as solicitation to effect, or attempt to effect transactions in securities, or the rendering of personalized investment advice for compensation. 

Advertising and Marketing. Communications such as this are not impartial and are provided in connection with advertising and marketing. This material is not suggesting a specific course of action or any action at all. Prior to making any investment or financial decisions, an investor should seek individualized advice from a personal financial, insurance, legal or tax professional that takes into account all of the particular facts and circumstances of an investor’s own situation. No person associated with Breakaway is a licensed attorney or tax professional and the information contained herein should not be considered tax or legal advice. 

Links to Third Party Content. This Market Update contains links to articles or other information maintained by unrelated third parties. You acknowledge and agree to the following: All such information is provided solely for convenience purposes only because we believe that it may provide useful content. and all users thereof should be guided accordingly. We disclaim any responsibility for the link’s performance or interaction with your computer, its security and privacy policies and practices, and any consequences that may result from visiting it.  We do not control the content published by the third-party; we do not guarantee any claims made on it, nor do we endorse its sponsor or any of the content, policies, activities, products or services offered by any advertiser on the site. Breakaway assumes no liability for any inaccuracies, errors or omissions in or from any data or other information provided by the third party and inclusion or reference by Breakaway to any third party link should not be construed by any consumer and/or prospective client as a solicitation to effect, or attempt to effect transactions in securities, or the rendering of personalized investment advice for compensation, over the Internet. 

Important Information regarding Registration Breakaway Financial Group, LLC and/or Patrick Traverse offer investment advisory and financial planning services through Belpointe Asset Management, LLC, (“Belpointe”) 500 Damonte Ranch, Parkway Building 700, Unit 700, Reno, NV 89521, an investment adviser registered with the Securities and Exchange Commission (“SEC”). Registration with the SEC should not be construed to imply that the SEC has approved or endorsed qualifications or the services Belpointe offers, or that its personnel possess a particular level of skill, expertise or training. It is important to read disclosures pertaining to Belpointe Asset Management at this link https://belpointeasset.com/disclosure/.  Additional information about Belpointe and Patrick Traverse is available on the SEC’s website at www.adviserinfo.sec.gov.

Craig Stahlecker

Craig Stahlecker

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IMPORTANT DISCLOSURES:
The information provided is intended to be educational in nature and is not intended to be a recommendation for any specific business or tax strategy, plan feature or other purposes. Accordingly, it should not be construed by any consumer and/or prospective client as solicitation of services.

Communications such as this are not impartial and are provided in connection with advertising and marketing. This material is not suggesting a specific course of action or any action at all. Prior to making any business or tax planning decisions, an individual should seek individualized advice from a personal financial, tax, legal, or business consultant professional that takes into account all of the particular facts and circumstances of an individual’s own situation. No person associated with Breakaway Financial Group LLC is a licensed attorney, and the information contained herein should not be considered legal advice.