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12:00 TUESDAY – Stock Market Report #148 – 1/11/22


by Robert Holman | The Defensive Advisor | www.defensiveadvisor.com


EQUITY MARKET RATING … 7.0 (0-4 bearish, 5 neutral, 6-10 bullish). Markets are looking OK, but not great. There are opportunities in a few sectors, and in a few stocks.


EQUITY MARKET and ECONOMY … While equity market opportunities looked quite good last Tuesday, at mid-day Wednesday the equity market reversed itself and declined sharply as the 10-year government rate picked up markedly, crossing 1.80% for the first time in quite a while. That increase really hit not-yet-profitable tech stocks quite hard (no matter their true long-term potential).


A noteworthy benchmark --- the “Santa Clause Rally” --- actually was in-process during the first 5-day post-Christmas period, and for the first 2 days of the new year --- but the reversal on Wednesday wiped out any positive investor conviction that might have come with that initial rally.


Offsetting the Santa Clause rally was a similar noteworthy benchmark --- trading results for the “First Five Trading Days of the DJIA” of the new year. For that 5-day period, the DJIA was down <106> points. A negative result like that generally points to a slow-growth or down year for the overall market.


As a result, the key strategy for the coming year appears at this point to be finding the sectors and companies that will outperform the overall market.


There were 1.5 million new Covid-Omicron cases reported yesterday, and people are guessing whether or not that could be the peak in new cases. If that were to be the case, that would be great news for the markets and economic growth. But, as always, new events could turn it all around, very quickly.


When change happens, we happen to change. But, that is no accident; that is by design. Many thousands of dollars have been lost by investors “betting on” predictions that never occurred. Many thousands of dollars of profits have also been "not made" (i.e., lost) by investors not dealing with change as it occurs. In other words, we do NOT try to “out-guess” or PREDICT the future. We DO try to assess the impact of change and RESPOND to change that is expected to TRIGGER positive (Buying) or negative outcomes (Selling). We believe this is the correct approach to outperforming the overall market.


Of course, my clients receive the quickest and greatest financial benefit from our decisions. Quicker and greater than the readers of this newsletter, but this newsletter will still help you get above average results, as you think about the issues raised herein.

Many investment advisors do not even attempt to respond to change, which to me seems either “lazy” or maybe it's just "a lack of knowledge” about what to do. It's not easy to accumulate enough data-information-understanding-knowledge-wisdom to know what to do. Unfortunately, the client is the loser when the investment advisor is either lazy or lacking in knowledge.


Please keep in mind that different parts of the equity market are unequally affected by what is occurring now. To find out what sectors, styles, and strategies are working, please consult with a financial professional who works full-time in portfolio management.


PORTFOLIOS … Just click here, and I’ll be happy to give you a complimentary portfolio evaluation – sending you an email explaining what’s good, how it’s likely to perform, and giving you a couple of ideas for improvement – again, all at no cost to you.


FREE OFFER for NEW SUBSCRIBERS – Contact me by email at roberth@defensiveadvisor.com, or by calling 972-702-6032, and I’ll be happy to give you an assessment of the opportunities and risks in your portfolio. I’ll also give you the name of two stocks on my watch list nearing Buy status.

TO MY CLIENTS, THANK YOU FOR YOUR TRUST. We’ve had great success since we started this RIA in mid-2018, up more than 94% in our moderate risk portfolios for the 13-quarter period ended September 2021, after all expenses are deducted.


Excelsior Divitiae. Published every Tuesday at 12:00 noon. For more information on my investment and planning services, or to sign-up for this weekly e-Newsletter, visit my website: http://www.defensiveadvisor.com/services OR http://www.defensiveadvisor.com/contact


Opinions voiced in this post are for general information only and are not intended to provide specific advice to or recommendations for any individual, without complete knowledge of that individual’s total financial profile. No strategy assures success or protects against loss. Past performance does not guarantee future results.

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Holman Wealth Management - The Defensive Advisor

Dallas, TX 75229 

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Last Edited: July, 2024

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To earn the CFA charter, candidates must master a broad-based curriculum of investment principles and commit to abide by, and annually reaffirm, their adherence to the CFA Institute Code of Ethics and Standards of Professional Conduct. The CFA Program curriculum provides a comprehensive framework of knowledge for investment decision making and is firmly grounded in the knowledge and skills used every day in the investment profession. The three levels of the CFA Program test a proficiency with a wide range of fundamental and advanced investment topics, including ethical and professional standards, fixed-income and equity analysis, alternative and derivative investments, economics, financial reporting standards, portfolio management, and wealth planning.

 

The CFA Institute Code of Ethics and Standards of Professional Conduct, enforced through an active professional conduct program, require CFA charter holders to:

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CFA® charterholders who fail to comply with the above ethics, professional standards and other requirements may be subject to the CFA Institute’s enforcement process, which could result in censure or permanent revocation of their CFA® charter.

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The CFP® certification is a voluntary certification; no federal or state law or regulation requires financial planners to hold CFP® certification. It is recognized in the United States and other countries for its (1) high standard of professional education; (2) stringent code of conduct and standards of practice; and (3) ethical requirements that govern professional engagements with clients. Currently, more than 71,000 individuals have obtained CFP® certification from the CFP Board in the United States. 


To attain the right to use the CFP® marks, an individual must satisfactorily fulfill the following requirements: 
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Individuals who become certified must complete the following ongoing education and ethics requirements to maintain the right to continue to use the CFP® marks: 
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CFP® professionals who fail to comply with the above standards and requirements may be subject to CFP Board’s enforcement process, which could result in suspension or permanent revocation of their CFP® certification. 

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