Head of Equity Strategy
As readers may have noticed, we have begun tracking our top 20 US equity picks in our Equity Radar model that we often use in webinars, the morning call and presentations. The portfolio was off to a strong start in June, up 5% as of June 6, but the pressure from the escalating trade war between the US and China hit the portfolio’s semiconductor holdings.
Red Hat also delivered a disappointing earnings release with a billings shortfall that took the market by surprise given the consensus that Red Hat has a very attractive long-term outlook. As of yesterday the portfolio is down 0.26% with the benchmark S&P 500 up 0.53%. Since inception the portfolio is up 0.07% with the S&P 500 up 0.05%
July portfolio rebalancing
Based on changing scores in our Equity Radar model, nine stocks are leaving the portfolio. Below is an overview of the changes.
Selling: ABIOMED, Best Buy, Cisco, DXC Technology, Garmin, NetApp, Red Hat, S&P Global, State Street
Buying: Micron Technology, HollyFrontier, H&R Block, KLA-Tencor, Intel, Valero Energy, Ralph Lauren, Expeditors International of Washington, IPG Photonics
The current portfolio is still dominated by IT stocks but today’s rebalancing means that two energy companies (Valero Energy and HollyFrontier) are entering the portfolio which is a natural extension of the bull market in global energy stocks. The portfolio characteristics are concentrated around high quality, high momentum and high reversal scores.
Top 20 US equities in our Equity Radar model:
The market is trying to get back to the pre-Covid and pre-war times, but that model is broken. A new dawn is here and the financial world needs to adapt.
Steen Jakobsen,
Chief Investment Officer
A political switch in China towards less tough control of its people and companies may kick things back into gear.
Redmond Wong,
Market Strategist
While the economic situation in Europe may not be as bad as feared, there's still a plethora of things to fix.
Chris Dembik,
Head of Macroeconomic Research
As the world turns increasingly bipolar, equity markets face harsh times as they transition into the new reality.
Peter Garnry,
Head of Equity Strategy
New alliances and collaborations outside of China may lead to prosperous times in Asia.
Charu Chanana,
Market Strategist
For years, it was thought that the balanced portfolio was a thing of the past. But recent developments may have changed that.
Peter Siks,
Investment Coach
Following a dramatic and volatile 2022 with good returns, a lot of this year's commodity performance may be driven by Chinese politics.
Ole S. Hansen,
Head of Commodity Strategy
2023 could be a tough year for currencies but EUR and JPY may have some upside.
John J. Hardy,
Head of FX Strategy
The commodity-heavy Australian market may have a good start to 2023, as the Chinese focus on growth signals demand for Aussie resources.
Jessica Amir,
Market Strategist
From a near-perfect environment for speculative assets before 2022 to the opposite, crypto faces fundamental challenges.
Mads Eberhardt,
Cryptocurrency Analyst
