SYNOPSIS
Most major indexes were up last week with a terrific rally that started at the end of the previous week. In spite of great one-week results, however, most of the indexes we track here are still trending lower… especially the S&P/TSX Venture Index.
ProfiTrend Portfolio… Our PTP annualized growth rate (AGR) is now at 219%, still very high given recent events. That compares with +12% for the S&P 500 and -15% for the S&P/TSX Composite Index! Although we’d like to believe otherwise, we suspect that the PTP “speed” will slow down somewhat. With a very small portfolio, such as we have right now, and very short holding times in some instances, the annualized results for the PTP are susceptible to greater weekly swings. All the same the math is correct, and the same that is applied to the major benchmarks.
Seasonality… We continue our discussion of what November has in store as far as calendar effects go.
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State Street Investor Confidence Index… We include the just-released October results. The current global index fell to 115.1 in October, down 8.8 points from September’s revised reading of 123.9. 100 is considered the neutral point in the balance between risky assets (i.e. stocks) and low risk assets (i.e. bonds). The regional breakdown continues to favour European equities, although that is the geographic region that fell the most this month. It’s still quite remarkable, that up until now “the smart money” has been devouring European equities, while virtually everyone else has been selling like crazy.
Topic of the Week… Back into the Neutral Zone
We continue to monitor the “correction”, and what now might be a recovery to the upside. The proportion of equities that have positive trend values is now in what we call a “neutral zone” (40% – 60%). We discuss what investors might do now, while waiting for a breakout up or back down in the weeks ahead.