The October 2026 Newsletter
The September Squeeze: When Diversification Stalled
September was the kind of month where the usual places to hide didn’t help. Stocks, long Treasuries and gold all ended the month lower.
Below: the month in numbers, how our strategies handled it, and how we are thinking about October.
September in Four Tickers
| ETF | September |
|---|---|
| SPY (S&P 500) | −0.3% |
| DIA (Dow 30) | −4.1% |
| TLT (20+ yr Treasuries) | −5.4% |
| GLD (Gold) | −6.8% |
The Nasdaq rose 1.9% in September while the Dow fell, so this was not a tech sell-off. The damage was concentrated in the Dow.
Bonds
Last month we wrote that the US 10-year yield was at 4.71%. On the last day of September it was about 5.29%, a new 52-week high. That is near its highest level since 2007, and the 30-year yield reached its highest mark since 2002. Long Treasuries paid for it, with TLT down 5.4% on the month.
Gold
Gold started September strong, with December futures settling near $4,540 on September 3. By the end of the month it was trading around $4,180. GLD finished down 6.8%, giving back much of the August breakout we covered last month.
What was behind it
Surging oil prices, a historic Treasury bond rout and a hawkish turn from the Fed made up the backdrop. The S&P 500 is still less than 2% below its last record close, so equities as a whole held up better than the headlines suggest.
Strategies, Ranked by YTD
| Strategy | 1 Month | YTD |
|---|---|---|
| Dow 30 Strategy | −0.6% | +14.4% |
| Maximum Yield Strategy | −8.5% | +12.0% |
| Gold-Currency Strategy II | 0.0% | +8.3% |
| World Top 4 Strategy | −1.7% | +8.2% |
| Universal Investment Strategy | −0.2% | +6.9% |
| Global Market Rotation Strategy | −1.2% | +6.2% |
| US Market Strategy | −1.7% | +6.2% |
| Conservative Risk Portfolio | −1.0% | +5.5% |
| Bond ETF Rotation Strategy | −0.9% | +5.1% |
| Hedge Strategy | 0.0% | +4.6% |
| Top 3 Strategies | −0.8% | +4.4% |
| Global Sector Rotation Strategy | −2.9% | +4.3% |
| BUG Permanent Portfolio Strategy | −0.2% | +3.8% |
| Moderate Risk Portfolio | −2.3% | +3.7% |
| Leveraged Gold-Currency Strategy | +3.4% | +1.3% |
| Enhanced Permanent Portfolio Strategy | −3.4% | +0.5% |
| US Sector Rotation Strategy | −2.6% | 0.0% |
| Universal Investment Strategy 2x Leverage | −5.9% | −1.0% |
| NASDAQ 100 Strategy | −0.8% | −1.5% |
| Aggressive Risk Portfolio | −5.1% | −1.8% |
| Universal Investment Strategy 3x Leverage | −8.9% | −3.0% |
| US Market Strategy 2x Leverage | −6.6% | −3.9% |
| Crypto & Leveraged Top 2 Strategy | −5.6% | −19.2% |
Performance based on signals issued by Logical Invest. Slippage and fees are not included.
Many of our strategies use the HEDGE sub-strategy as a variable hedge. It chooses among GLD, TLT and TIPS, and in September it correctly shifted into GSY, the ultra-short-term paper fund that works like cash.
With GLD down 6.8% and TLT down 5.4%, that shift is what enabled our strategies to limit their losses while stocks, bonds and gold declined together.
Looking at October: A Scenario, Not a Forecast
September kept its reputation as a volatile month. This year the S&P came in better than that average and the Dow came in far worse.
2026 is also a US midterm election year, with the vote in early November. Historically, the stretch leading into midterms has often been choppy, with a final washout or consolidation low as uncertainty peaks. The months after the vote have often been much stronger.
That pattern gives one scenario: a weak or volatile October, followed by a recovery into year-end.
It is a pattern in past data, not a prediction, and it has not played out every time. This year it has to compete with yields at multi-year highs and a Fed that has not finished deciding how it wants to handle inflation. If yields keep climbing, it could easily fail.
Have a Plan, and Stay Flexible
We don’t know what October brings, and neither does anyone else. Whether it is a low followed by a rally, or something else entirely, we think two things matter: a plan you can stick with when markets are rough, and enough flexibility to change it when conditions change.
We can help with both. Our strategies and portfolios give you a rules-based starting point, and QuantTrader lets you backtest your own ideas or build your own strategies. Use them however fits your plan, and tell us how you are handling this in the forum.
We wish you a healthy, fulfilling, and profitable October.