Review of '23 & Focus for '24

S.T.A.Y.™ current position for Active portion of portfolio: CASH – S.T.A.Y. Plus™

Review of the past and adjustments for the future.
Some significant changes were made during the last two years due to a drastic change in how bonds performed in relationship to stocks.
          Problem:

1. Bonds no longer a safe haven when stocks falter.  After a long history of having an inverse correlation to the market, just the opposite was true moving into the Bear market of 2022.
2.    (Bear Market of 2007-2008 S&P500 -37%  vs Long Term Bonds +10%)

                                                                    vs
                      (Bear Market of 2022 S&P500 -24% vs Long Term Bonds -32%)

• Inverse funds are the only thing that have a near-perfect negative correlation to the market, however they require nimble management during volatile market situations.

The last two years, we have worked diligently to solve this problem in our long-term management strategy and have made the necessary adjustments to maintain a successful outcome moving forward. These adjustments were challenging and not always as successful as we hoped for the short term.  However, for the longer term we feel that the adjustments are in place to manage these volatile market situations without relying on a built-in assumption that bonds will carry the load during market downturns as they have in the last several decades.

We have been long the market since the “line in the sand” level of 4607 previous high of 7/27 was penetrated.
Since then, the market has risen about 2 ½%.  Therefore, we are currently in line with how the market has been moving in recent weeks.  Keep in mind another “line in the sand”, which would be the previous all-market high of 4818 made on January 4, 2022.  This is the “line in the sand” that the market must penetrate to leave the bear market in the rear-view mirror.  Although we are not out of the woods yet, we will keep you posted.

This new long position (terminology for going with the upward trajectory of the market) may be for a few days or a few weeks as we will be operating off of our shorter-term indicators to make changes as needed in a more timely fashion.  We will keep you posted.  If this more sensitive signal continues to indicate a breakout, this will change the longer-term signal from CASH to a BUY.

​Weekly S&P 500 Chart with Fibonacci Retracement Percentages (from the all-time high)

​Monthly S&P 500 Chart with Fibonacci Retracement Percentages (from the all-time high