Positive Asbury 6 Suggests More Market Strength
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In our previous Nov 20th Stock Market Update & Asbury Investment Management Video, entitled Happy Holidays For Investors? Watch The Market’s Vital Signs, we pointed out that our Asbury 6 risk management model turned back to a Positive (bullish) status on Nov 4th. We said that as long as that Positive status remained intact, the US stock market was likely to continue moving higher over the near term — despite its incredible 68.8% rise from the Mar 23rd lows.
The table below shows that the Asbury 6 has indeed retained its Positive status through Friday.
The Asbury 6 Model
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The purpose of the “Asbury 6” is to be a daily check-up of the US stock market’s baseline health, much like the initial part of your trip to the doctor’s office always includes the same routine: the doctor takes your temperature, checks your blood pressure, listens to your heart, checks your reflexes, and may take some blood. In the same way, the Asbury 6 checks price momentum, the relative performance of stocks versus bonds, investor asset flows, the bond market’s assessment of risk, trading volume, and market breadth. Both are repeatable routines that establish the baseline health of the “patient”, so we know what to do going forward.
The Asbury 6 indicates when to be invested. Another one of our in-house quantitative models, the Cross-Asset Relative Performance (CARP) Model, indicates where to be invested. A newly-updated version of the CARP Model appears below.
Asbury Research’s CARP Model
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In my colleague Ken Tomko’s accompanying video below, he mentions that Asbury Investment Management (AIM) is starting to put some money to work in Emerging Markets. Those ideas come directly from CARP.
The CARP Model identifies which specific areas of the US financial landscape are the best performers via 8 different Equities-related relative comparisons and 3 different Fixed Income-related relative comparisons. The model shows that Emerging Markets has been outperforming US Markets since June 1st on a Tactical (one month) basis and since June 17th on a Strategic (three month) basis. In percentage terms, Emerging Markets has outperformed by 4.7% since mid-June.
By closely tracking these relative relationships in three different time frames, CARP can indicate which parts of the market to be invested in — to maximize performance during Positive / Risk On periods as indicated by the Asbury 6.
Our latest video below shows how we have navigated these recent market conditions in real-time.
Asbury Investment Management (AIM): Our Latest Video
Asbury Research Ideas, Expertly Managed
Here is our November 20th Video Review, which explains how we have recently utilized Asbury Research’s market analysis and investment ideas to professionally manage client portfolios.
AIM offers a unique approach to investment management that is data driven, dynamic, and solely based on the current technical condition and quantitative risk/reward profile of the financial markets.
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This communication is for informational purposes only. It is not intended as investment advice, or as an offer or solicitation for the purchase or sale of any financial asset. 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.