Equity Radar US portfolio
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:
Quarterly Outlook Q2 2022
Quarterly Outlook Q2 2022: The End Game has arrived
- Shocks from covid and the war in Ukraine have forced the global financial and political world to change, but what will the end game be?
Productivity and innovation have never been more importantAs the world economy hits physical limits and central banks tighten their belts, could equities be facing a 10-15% downside?
The great EUR recovery and the difficulty of trading itIf the terrible fog of war hopefully lifts soon, the conditions are promising for the euro to reprice significantly higher.
Tight commodity markets – turbocharged by war and sanctionsWith supply already tight, commodities keep powering on. But will it last for yet another quarter?
Between a rock and a hard placeGeopolitical concerns will add upward price pressures and fears of slower growth, while volatility will remain elevated.
The Great ErosionInflation is everywhere and central banks try to combat it. But will they get it under control in time?
Australian investing: Six considerations amid triple Rs: rising rates, record inflation and likely recessionWhile global financial markets are struggling in an uncertain world, the commodity-heavy Australian ASX index is poised to keep a positive momentum.
Cybersecurity – the rush to catch up with realityWith the invasion of Ukraine, governments and private companies are rushing to reinforce their cyber defenses.