The Cumberland Advisors Week in Review is a recap of news, commentary, and opinion from our team.
These are not revised assessments, and circumstances may have changed in the market from the time of original publication. We also include older commentaries that our editors have determined may be of interest to our audience. Your feedback is always welcome.
MATT MCALEER'S WEEKLY RECAP
In this week's review we have John R. Mousseau, Cumberland's President, Chief Executive Officer & Director of Fixed Income, join us for the first half of the video.
John talks about:
-A framework for the last quarter in fixed income
-A rush down in yields, unprecedented for such a short period of time
-Negative yields are a bad idea
-Negative yields hurt banks
-Longer muni-bonds are somewhat attractive on a relative basis
-Cumberland plays defense on bonds
Matt continues and talks about:
-Cumberland's fixed income analysis and equities analysis go hand in hand
-How has the market affected our strategies?
-For the past five years, growth has dominated value. How about now?
-Keep your portfolio buckets aligned with your objectives
-If you find yourself emotional in relation to headlines, limit it to only a portion of your buckets
-Leo Chen is done with his Quantitative Research Whitepaper. Editors are giving it a final pass. Have you asked for it? See Leo's talk about it here
-Please keep the comments and questions coming.
-Email us at [email protected] or give us a call at (800) 257-7013
Enjoy your weekend and please send us your questions and comments. We thank you for joining us!
Watch below or at this link: https://youtu.be/en4MJQiShzk
Matt enjoys your feedback. You can reach him at:
-Link to Matt's Email: [email protected]
-Link to Matt's Twitter: https://twitter.com/MattMcAleer4
-Link to Matt's LinkedIn: https://www.linkedin.com/in/matthew-mcaleer-9415b16/
Saudi Attack Part 2
by David R. Kotok
“Absent a war or further attacks on Saudi facilities – both of which remain possibilities – this past week’s events now look like a blip in a longer-term bearish pattern for oil prices and stocks. Energy makes up less than 5% of the S&P 500 index’s market cap, the lowest level in at least 40 years.” (“What the Saudi Attacks Mean for Energy Investors,” Barron’s, https://www.barrons.com/articles/what-the-saudi-oil-attacks-mean-for-energy-investors-51569012612)
We believe that assuming the Saudi Attack event is a one-off is a mistake. History is replete with examples that support our thinking on this matter. In order to assess future risks, we must now piece together a very complex geopolitical mosaic.
The Barron’s article discusses investment options and strategies. Ours is clear. We want to own an overweight position in US oil and gas exploration and production. We expect the world to be a growing customer, and US is the safest and most contractually reliable source. Trump trade war obstacles are surmountable in the energy sector, and pipeline completions slowly proceed. We’re unabashed energy bulls.
Here are some additional thoughts about how to follow the Middle East news flow while not succumbing to the CNN-Fox political spitting contest. To get the full story, we must look in the weeds. Here goes.
The Saudi Attack: Bullets:
1. The headlines of some of the pieces in the links below are guilty of political posturing or signaling. None should be taken as fully free of bias. But all should be followed and the stories digested to discern inconsistencies, piece together informed judgments and understandings, and thereby better plan scenarios.
2. We believe this latest outbreak is part of an intensifying Middle East war between the Shia alliance, led by Iran, and the Sunni alliance, led by Saudi Arabia. An understanding of this 1000-year Islamic schism is necessary. Readers are advised to study that history.
3. Following the news flow profitably requires multiple sources, and those with a regional presence are more credible than those that “report” from the US through secondary sources. I follow Bloomberg, Reuters, NYTimes, WSJ, and WaPo and receive a good daily summary from Politico. Fox and CNN are sources so distorted by their respective political views as to be unreliable. Bloomberg and Reuters, on the other hand, are top-notch worldwide, with foreign correspondents on the ground in many countries. I also follow many serious geopolitical research services and analysts, along with non-US media. Investment professionals must look widely to understand situations like the Middle East.
Here are some non-US sources to add to your news list.
Here is a roundup of recent news reported in US sources.
David R. Kotok
Chairman of the Board & Chief Investment Officer
Email | Bio
It's that time of year when the Team at Cumberland Advisors provide their Q3 Reviews. We may discuss what we favor, cash positions, warning signs, and what we see as opportunities. Read to learn more about the thinking behind our positioning of portfolios and how we execute strategies. https://www.cumber.com/2019-q3-reviews
Current reviews include...US ETF/Markets by David Kotok: https://www.cumber.com/cumberland-advisors-market-commentary-3q19-review-us-equity-etf/
Market Volatility by Leo Chen: https://www.cumber.com/cumberland-advisors-market-commentary-3q2019-review-market-volatility-etf/
International ETF by Bill Witherell: https://www.cumber.com/cumberland-advisors-market-commentary-3q-2019-review-international-equity-etf/
Federal Reserve by Bob Eisenbeis: https://www.cumber.com/cumberland-advisors-market-commentary-repos-and-reverse-repos/
Foundations by Gabriel Hament: https://www.cumber.com/cumberland-advisors-market-commentary-time-to-re-examine-donor-advised-fund-tax-policy/
Taxable Fixed Income by Dan Himelberger: https://www.cumber.com/cumberland-advisors-market-commentary-3q-2019-review-total-return-taxable-fixed-income/
We invite you to visit our YouTube channel and explore the "Camp Kotok" video playlist. This playlist is comprised of Camp Kotok interviews with guests and "campers" who participate and enjoy sharing with us. We also include panel talks, scenes from the location in Maine, and other snippets we find interesting. Enjoy! #CampKotok
Matt McAleer, Executive Vice President & Director of Equity Strategies for Cumberland Advisors, appears on the TD Ameritrade Network, September 26th, to discuss investing in international equities.
View the interview here: https://tdameritradenetwork.com
You can watch Matt's deliver weekly updated market commentary here on Cumberland Advisors' YouTube Channel.
