Wednesday, June 2, 2010

June aggressive allocation

To my surprise, many indicators are stuck in the middle and smart money is staying away from being allocated to stocks aggressively. This is the lowest stock allocation reading so far. High VIX seems to be throwing a lot of smart money investors to the sidelines. Many intermediate term breadth indicators have deteriorated in the month of May.

Positive factors:
None

Neutral factors:
Long term trend
Market valuations
Sentiment

Negative factors:
Underlying technical strength
'Ahead of curve' investor positioning

Allocation for June:
Stocks: 25%
Bonds: 75%

June moderate allocation

To my surprise, many indicators are stuck in the middle and smart money is staying away from being allocated to stocks aggressively. This is the lowest stock allocation reading so far. High VIX seems to be throwing a lot of smart money investors to the sidelines. Many intermediate term breadth indicators have deteriorated in the month of May.

Positive factors:

None

Neutral factors:
Long term trend (within stone throwing distance of 200 day)
Market valuations
Sentiment

Negative factors:
Underlying technical strength
'Ahead of curve' investor positioning

Allocation for June:
Stocks: 15%
Bonds: 85%