Risk On as of March 31st
(from Risk Off on February 21st)

Our quantitative model for the US stock market, which uses the S&P 500 (SPX) as a proxy, shifted to “Risk On (increasing market exposure) as of the close on March 31st from “Risk Off” (decreasing market exposure) on February 21st.

Explanatory Notes: 
  • The Correction Protection Model (CPM) is our own proprietary defensive model for the S&P 500.  It is quantitative, objective, and independent of the research and analysis that appears in our various reports.

  • CPM is binary – it is either Risk On or Risk Off.

  • CPM was not designed to be a returns-driven model — it is a wealth preservation tool.  It was designed to protect investor assets during potentially dangerous market conditions while also taking advantage of the market’s historical tendency to move higher over time.
  • We suggest using CPM as an indication of when to maintain or increase market exposure (Risk On) and when to reduce market exposure (Risk Off).  When CPM is in a Risk Off status, managers/investors should consider reducing risk by aggressively tightening protective stops on existing positions and/or exiting positions that are underperforming the market.

The chart below highlights CPM’s signals over the past 15 months

Click Here for additional information about CPM

Disclaimer: This data is provided for information purposes only and is not intended to be a solicitation to buy or sell securities. The performance indicated from back-testing or hypothetical results may not be typical of future performance. No inferences may be made and no guarantees of profitability are being stated by Asbury Research LLC. The risk of loss trading in financial assets can be substantial. Therefore, you should carefully consider whether such trading is suitable for you in light of your financial condition.

We suggest that subscribers consider all of our research, not just this model or any single indicator or metric, when making decisions that affect their portfolio.