Investment Commentary

REGIME SHIFT…TIME TO FIGHT THE FED…ASSET ALLOCATION UPDATE

September 04, 2022

REGIME SHIFT…TIME TO FIGHT THE FED…ASSET ALLOCATION UPDATE by Neil Azous, Chief Investment Officer Michael Sedacca, Portfolio Manager FEDERAL RESERVE HIKING CYCLE CERTAINTY IS THE... Continue Reading →

DEMYSTIFYING THE PRICING OF INTEREST RATE CUTS

August 18, 2022

DEMYSTIFYING THE PRICING OF INTEREST RATE CUTS by Michael Sedacca, Portfolio Manager INTRODUCTION BACKGROUND MISCONCEPTION ABOUT CUTS WEIGHTING PROBABILITY... Continue Reading →

STOCK MARKET CORRECTION FRAMEWORK

April 27, 2022

STOCK MARKET CORRECTION FRAMEWORK by Neil Azous, Chief Investment Officer INTRODUCTION TWO TYPES OF CORRECTIONS ALL CORRECTIONS TYPE 1 CORRECTION TYPE 2... Continue Reading →

THE MOST IMPORTANT OBSERVATION IN YOUR PORTFOLIO YOU PROBABLY AREN’T AWARE

March 13, 2022

THE MOST IMPORTANT OBSERVATION IN YOUR PORTFOLIO YOU PROBABLY AREN'T AWARE OF by Neil Azous, Chief Investment Officer THE 40% BOND ALLOCATION – NOW SECOND LARGEST DRAWDOWN IN HISTORYCAN IT GET... Continue Reading →

MUNICIPAL BOND CLOSED-END FUNDS: MOST FEAR IN OVER A DECADE

February 17, 2022

MUNICIPAL BOND CLOSED-END FUNDS: MOST FEAR IN OVER A DECADE by Michael Sedacca, Portfolio Manager MUNICIPAL BOND CEF DISCOUNTS-TO-NAVDIVIDEND RATIO: MUNICIPAL BOND CEFS VS. CASH MUNICIPAL BONDSMUNICIPAL... Continue Reading →

Closed-End Fund Seasonality: Like Clockwork

December 22, 2021

by Michael Sedacca, Portfolio Manager   Seasonality is the tendency for securities to perform better during some periods and worse during others.   In the last quarter of the... Continue Reading →

Don’t Act Haphazardly to Hawkish Fed Shift – Interest Rate Outlook Update

September 29, 2021

by Neil Azous, Chief Investment Officer   A Model Driven Approach To The Federal Reserve Probability Framework Unconditional Probabilities Four Quadrants The Qualitative Arguments... Continue Reading →

Asset Allocation Changes – Increase High-Grade Fixed Income, Decrease TIPS

May 05, 2021

by Neil Azous, Chief Investment Officer Case for Increasing “High-Grade” Fixed Income Case for Decreasing Treasury-Inflation Protected Securities (TIPS) Asset Allocation Changes   In our... Continue Reading →

It Has Been Decided…The Federal Reserve’s Sacrificial Lamb Is The Nasdaq-100 Index

March 23, 2021

by Neil Azous, Chief Investment Officer The Starting Point Observing The Trend Change Confirming an Intermediate-term Trend Change Linkage Between NASDAQ-100 & 30-Year US Treasury Yields How... Continue Reading →

A Regime Change Occurred Last Week…Here Is How It Could Impact Your Portfolio

February 22, 2021

by Neil Azous, Chief Investment Officer The Next Sight Beyond Sight® Three Critical Signals Regime Shift Impact on Asset Classes: U.S. Equities, Gold, U.S. Dollar, Emerging Markets, TIPS A Final... Continue Reading →

Concerned About Inflation? U.S. Government Bonds Are Not The Only Asset Class At Risk

January 14, 2021

by Neil Azous, Chief Investment Officer   The breakeven inflation rate is the difference between nominal yields and real yields. In early January, the entire U.S. Treasury breakeven inflation curve... Continue Reading →

More Yield, More Risk? You Might Be Surprised

December 08, 2020

by Neil Azous, Chief Investment Officer   Interest rates are at the Effective Lower Bound (ELB). The Federal Reserve is attempting to engineer inflation. Traditional core bond portfolios are yielding less... Continue Reading →

Our Investment Approach in the Lead Up to the Presidential Election

July 07, 2020

by Neil Azous, Chief Investment Officer Timeline – When to Care The Two Opposing Views Investing in Practice   Timeline – When to Care The US Presidential Election is Tuesday, November... Continue Reading →

Rare Opportunity in Municipal Bond Closed-End Funds

June 17, 2020

by Neil Azous, Chief Investment Officer There are four potential ways to make money in municipal bond closed-end funds: Net-Asset-Value Appreciation High Income Distribution Broad discount-to-NAV... Continue Reading →

Like The Coronavirus, The Stock Market Correction Is A New Strain

February 28, 2020

by Neil Azous, Chief Investment Officer Our Stock Market Correction Framework All Corrections Type 1 – Correction Type 2 - Correction Current Correction “A Different Strain” What... Continue Reading →

Coronavirus To Trigger Fed To Declare Force Majeure On Rate Pause

February 18, 2020

by Neil Azous, Chief Investment Officer CEF Federal Reserve – Our Track Record Our Approach to the Federal Reserve is Model Driven What Is Our Super-Forecasting Model Saying Currently? FOMC... Continue Reading →

Our Investment “Quilt” For 2020 is Sewn with Diversification

January 29, 2020

by Neil Azous, Chief Investment Officer   The Callan Periodic Table of Investment Returns depicts annual returns for 10 asset classes, ranked from best to worst performance for each calendar year. Each... Continue Reading →

Gold Is Not the Portfolio Diversifier You Are Looking For

October 18, 2019

by Neil Azous, Chief Investment Officer   Summary Background Gold Is Not the Portfolio Diversifier You Are Looking For Conclusion   Background Let me be clear at the outset - I have no... Continue Reading →

Fed Cutting Cycle – The Next Evolution

September 25, 2019

by Neil Azous, Chief Investment Officer   Summary Taking Stock Mid-Cycle Adjustment a False Narrative The Next Evolution Where Does This End? What Does This Mean For Your... Continue Reading →

The Case for Switching to Municipal Bond Closed-End Funds from Cash Municipal Bonds

July 03, 2019

by Neil Azous, Chief Investment Officer Summary The Starting Point – Discounts in the Municipal Bond CEF Universe Remain in the Top 10% of History Municipal Bond Closed-End Funds Outperform Municipal... Continue Reading →

Fed Cutting Cycle – Our View Is Crystallized

May 31, 2019

by Neil Azous, Chief Investment Officer   Summary Taking Stock Eurodollars – The End of the Cutting Cycle Observed The Next Seven Months Multi-Asset Framework Supports What is Being Priced... Continue Reading →

Mortgage REIT’s – Leveraging The Path To Lower Interest Rates

March 12, 2019

by Neil Azous, Chief Investment Officer   Consistent with the themes laid out in our recent post “The New Narrative For Lower Interest Rates,” we believe that including assets that have positive carry... Continue Reading →

The New Narrative For Lower Interest Rates

February 19, 2019

by Neil Azous, Chief Investment Officer   Summary Taking Stock A Model Driven Approach To The Federal Reserve What Does Rareview Capital Think? What Does This Mean For Your Portfolio?... Continue Reading →

Closed-End Fund Outlook – Tapping You On The Shoulder

January 17, 2019

by Neil Azous, Chief Investment Officer   Last year, nearly every asset class fell, with many experiencing a bear market decline of more than 20%. The damage done to closed-end funds was significant,... Continue Reading →

Yield Curve Inversion – What Does It Mean For Your Portfolio Right Now

September 05, 2018

by Neil Azous, Chief Investment Officer Taking Stock On Monday, March 12th, we wrote a blog post titled: “Why We Are Still Not Afraid of Higher Yields.” On Friday, March 9th, the 10-year US Treasury yield... Continue Reading →

A Way to Participate In The Equity Market With Reduced Risk

June 21, 2018

by Neil Azous, Chief Investment Officer   As a long-time derivative specialist, I believe that equity volatility is driven by two key variables, one technical and one fundamental. Technically, equity... Continue Reading →

Closed-End Fund Outlook – Sector Analysis – Municipal Bonds

March 13, 2018

by Neil Azous, Chief Investment Officer   Summary Potential Benefit of a Municipal Bond Closed-End Fund Discounted Yield Municipal Bond Closed-End Funds Discounts At Widest Levels Of This Cycle... Continue Reading →

Why We Are Still Not Afraid Of Higher Yields

March 12, 2018

by Neil Azous, Chief Investment Officer   Summary The Current Market Mind Map Where We Are At In The Interest Rate Hiking Cycle What Is Our Federal Reserve Model Saying? What Does Rareview... Continue Reading →

Closed-End Fund Outlook – Volume 4

November 08, 2017

by Neil Azous, Chief Investment Officer   Summary What Interest Rate Volatility Is Saying Where We Are At In The Interest Rate Hiking Cycle What Is Our Federal Reserve Model Saying? Potential... Continue Reading →

Investing During the Specter of War

October 24, 2017

by Neil Azous, Chief Investment Officer   Summary Human emotion is a dominant factor when making investment decisions. This is especially true regarding military conflict, including the specter of war... Continue Reading →

Closed-End Fund Outlook – Volume 3

September 05, 2017

by Neil Azous, Chief Investment Officer   Summary US dollar weakness is #1 theme for investors ABC Interest rates to remain contained outside of fiscal success ABC Emerging over developed... Continue Reading →

Closed-End Fund Outlook – Volume 2

July 19, 2017

by Neil Azous, Chief Investment Officer   Summary US bond market agnostic to whether Fed raises interest rates this year or doesn’t ABC Emerging over developed markets; bias to local currency... Continue Reading →

Why We Are Not Afraid Of Higher Yields

June 08, 2017

by Neil Azous, Chief Investment Officer Summary The response to the buildup of the Federal Reserve’s balance sheet – aka Quantitative Easing – provides a road map for the response to the unwind of... Continue Reading →