Wealth Protect Status Update: November 2016

We email the status of our WealthProtect System* monthly and give probability (Low, Mid, High) of a change in status within the next two months. We also include a commentary on actions taken this month as well as changes in overall asset allocation.​

Commentary

So the election results were not what conventional wisdom predicted, and neither was the market reaction. After S&P 500 futures dropped dramatically over the evening of the 8th, equities had a pretty good day on the Wednesday after the election instead of the crash that was expected. Since then the reaction of capital markets has been split. Developed equities in the US and overseas have risen, with small company stocks doing particularly well. Bond yields have also sharply risen, which has caused US Treasury Bonds and many other types of bonds to fall in value. Other interest-rate sensitive investments have also fallen, such as utility stocks, Real Estate Investment Trusts, emerging foreign equities, and commodities in general. In my opinion, this is still a reaction to the results of the election and likely an overreaction in the short term. Our WealthProtect System did not trigger; however Real Estate Investment Trusts and Commodities weakened sufficiently that they are close to triggering. We don't react to the emotions of the market. While the new Trump reality may portend better growth and maybe higher inflation, much remains to be seen. Having a well-diversified portfolio that is tactically nimble continues to be our preferred approach. Please call if you have questions.

Thanks as always for your trust.

*The Armstrong Wealth Management Group WealthProtect System is an investment risk control system designed (but not guaranteed) to limit significant losses in major bear markets (excess of 30% loss from market peak to market trough). It is NOT designed to prevent normal market losses (under 20%). No strategy can assure a profit or protect from a loss. Occasional false signals can reduce returns.

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.

Stock investing involves risk including loss of principal.The prices of small and mid-cap stocks are generally more volatile than large cap stocks. All indices are unmanaged and may not be invested into directly.

International and emerging market investing involves special risks such as currency fluctuation and political instability and may not be suitable for all investors.

Investing is Real Estate Investment Trusts (REITs) involves special risks such as potential illiquidity and may not be suitable for all investors. There is no assurance that the investment objectives of this program will be attained.

The fast price swings in commodities will result in significant volatility in an investor's holdings.

All performance referenced is historical and is no guarantee of future results.

There is no guarantee that a diversified portfolio will enhance overall returns or outperform a non-diversified portfolio.

Diversification does not protect against market risk. The forecasts set forth may not develop as predicted and there can be no guarantee that strategies promoted will be successful.

Because of their narrow focus, sector investing will be subject to greater volatility than investing more broadly across many sectors and companies.

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