The Week in Review: Performance updates from Cabana’s CEO – July 4, 2017

7 years ago

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Market insight and a highlight of Cabana’s year-to-date performance

Cabana’s six portfolios range from “Conservative” to “Aggressive” and include an income strategy portfolio. Performance is as of market close July 3, 2017 and is presented net of advisory fees and commissions.

All portfolios were down for the week between -1.34% (Conservative) and -.32% (Alpha Income). The Conservative Portfolio underperformed despite a down market for the week as a result of the continued pullback in large tech stocks (QQQ), as well as gold (GLD) losing 2.5%. The Conservative Portfolio currently holds positions in both. These assets are typically non-correlated and it is unusual that we would see the sharp pullback in high beta assets (tech) and safe-haven assets (gold) not catch a bid. This anomaly is consistent with normal profit taking in the overbought tech sector, coupled with the strong June ISM data. Strong economic data will allow the Fed to continue to raise rates thereby boosting the Dollar. A strong Dollar is traditionally bad news for gold. A review of the monthly charts of GLD and UUP show this relationship. The Dollar pullback last week appears to be in response to Europe hinting at more hawkish policy on that side of the ocean, rather than weakness here in the U.S.

As I pointed out last week, a correction in big tech will likely bleed over into the broad equity markets, which will result in pullback, even if it is just normal and healthy profit taking after an exceptional run-up. Summer is traditionally volatile and we could start to see some selling of equities. We will not put the cart before the horse or make predictions with our portfolios, but rather respond to macro changes as they occur. Stay disciplined and enjoy the best season of the year for friends, family and fun!

Year-to-date net-of-fees performance:

CONSERVATIVE: +6.17%

MODERATE: +8.21%

BALANCED: +9.79%

GROWTH: +8.06 %

AGGRESSIVE: +7.78%

ALPHA INCOME: 3.18%

Performance is presented net of advisory fees and commissions (Conservative – Aggressive is presented net of 3% fees from January 1, 2017 – February 28, 2017 and 2% beginning March 1, 2017; Alpha Income is presented net of 2% fees)

-G. Chadd Mason, CEO

*Performance numbers indicated with (+) for positive return and (-) for negative return.

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All performance returns are presented net-of-fees and include the reinvestment of dividends and capital gains. Benchmark comparisons are presented gross-of-fees.

Past performance may not be indicative of future returns. No current or prospective client should assume that the future performance of any specific investment or strategy will be profitable or equal to past performance levels.

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Cabana LLC manages assets on multiple custodial platforms. Performance results may vary based upon differences in associated costs and asset availability within the Cabana Model.

Disclaimers

January 17, 2024

This material is prepared by Cabana LLC, dba Cabana Asset Management and/or its affiliates (together “Cabana”) for informational purposes only and is not intended to be relied upon as a forecast, research or investment advice, and is not a recommendation, offer or solicitation to buy or sell any securities or to adopt any investment strategy. This material may only be distributed in its original format and may not be altered or reproduced without the prior written consent of CabanaThe opinions expressed reflect the judgement of the author, are as of the date of its publication and may change as subsequent conditions vary. The information and opinions contained in this material are derived from proprietary and nonproprietary sources deemed by Cabana to be reliable, are not necessarily all-inclusive and are not guaranteed as to accuracy. As such, no warranty of accuracy or reliability is given and no responsibility arising in any other way for errors and omissions (including responsibility to any person by reason of negligence) is accepted by Cabana, its officers, employees or agents.  

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Commonly used index/benchmark definitions:  

All indices and categories are unmanaged and an individual cannot invest directly in an index or category. Index returns do not include fees or expenses. Benchmark indices will likely materially differ from Cabana’s portfolio strategies. Detailed information as to how the returns are calculated can be obtained online from the following link: https://thecabanagroup.com/disclaimers/performance-reporting-methodology/. 

Morningstar’s Moderate Target Risk index  follows a moderate equity risk preference and is based on well-established asset allocation methodology from Ibbotson Associates, a Morningstar company.  

Morningstar’s Tactical Allocation category includes portfolios that seek to provide capital appreciation and income by actively shifting allocations across investments. These portfolios have material shifts across equity regions, and bond sectors on a frequent basis. 

The S&P 500 Index is a market-capitalization weighted stock market index of 500 widely held large-cap stocks often used as a proxy for the U.S. stock market.  

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The Nasdaq Composite Index is a market-weight capitalization index that covers more than 3,000 stocks listed on the Nasdaq Stock Market. What is the Nasdaq Composite, and What Companies are in It? | Nasdaq