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September Trend Report | 2019

Three out of the four pangs suggest that we are in a late cycle environment and should maintain a cautious stance that favors high quality and low volatility investment strategies.  

US stocks remain highly overvalued, which suggests below average returns for the next 10-20 years. This, paired with the considerable pull back in GDP, leads us to conclude that productive cash flow investment strategies may help buffer this growth slowing trend. 

We are currently experiencing a slowdown in the business cycle. Growth is above trend and decelerating, signifying that it may be a good time to overweight low volatility and quality factors. 

Intermarket relationships continue to indicate a risk averse posture, with defensive factors remaining in favor of offensive ones, and the Utilities, REITs, and Staples sectors winning over the last 12 months by a large margin.

In our opinion, the Federal Reserve should consider cutting rates in order to steepen the yield curve. If not a rate-cut, other restructuring efforts such as an infrastructure bill or fiscal stimulus plan could assuage the current margin we are seeing.

Click below for the full report and webinar playback. 

WealthShield Trend Report | September 2019