The Logical-Invest newsletter for November 2019

S&P 500 Powers To New Record

For the third time in three months, the Federal Reserve lowered its key interest rate by a quarter percentage point, to a range of 1.5% to 1.75%. The main reason quoted was to help sustain U.S. growth despite a slowdown in other parts of the world. The FED did, however signal there would be no further reductions unless the economy takes a turn for the worse. Stocks advanced in the wake of the Fed’s policy decision, with the S&P 500 index hitting a record of $3,046.

From the three main asset classes, gold performed best (GLD + 2.56%) followed by U.S. equities (SPY +2.21%). Treasuries were negative for the month (TLT -1.11%) despite a short bounce following the rate cut.

Our strategies did well and almost all came in positive. Our top two have now surpassed the 45% mark year-to-date: The 3x Universal Investment Strategy (UISx3) added 6.23% to it’s stellar year-to-date performance while the Maximum Yield Rotation Strategy (MYRS) added +2.96%. Our simple and free Enhanced Permanent Portfolio added +0.9%.

Interestingly this month’s best equity performers came from outside the U.S. Despite the FED quoting global slowdown in other parts of the world, the Emerging Markets ETF (EEM) was up + 4.18%. Austria was up + 6.41%, Germany + 6.09%, Greece + 5.68%, Brazil + 5.86%, South Africa + 4.53%, Mexico + 3.72%. Looking closer at the markets we can see that UUP, the Dollar index ETF, did finally correct by -1.88% which helped boost foreign equity performance. Below you can see monthly charts for a. the dollar index and b. The U.S. to Emerging Markets performance ratio (SPY/EEM):

Dollar Index and emerging vs US markets
Dollar Index 1996-2019
eem vs spy
S&P500 vs Emerging markets (EEM) performance

We look forward to a vivid discussion. Visit our site for daily updated dashboard.

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