The Dog Days of a Stock Market Summer

Posted on Aug 13 2015 - 12:50pm by Sharpe Trade

The dog days of summer have arrived for the market.  The summer doldrums.  Whatever you want to call this seasonally tepid period we find ourselves in …

S&P 500 Seasonal Tendency Signal Financial Group

Trying to find interest in the stock market as of late has been difficult to say the least.  This is usual.  Folks are too busy having fun in what is turning out to be a beautiful summer in many places.  

As we stated yesterday, our Sharpe Report teaching portfolio had recently recovered 209 BPS (2.09% for folks who are new) after the drawdown experienced earlier in the year.  Since we are in the ‘Dog Days of Summer’ it’s advantageous we are using a non-directional strategy.   We gave up 13 BPS with yesterday’s action … but that’s nothing to speak of really.  We’re pleased with the results of the strategy overall.

Also as stated yesterday, we’ve had a flat market all year really.  Given that context, I am apt to give credence to the concept we will not see much strength in equities until the end of the year, as seasonal tendencies tend to indicate.  

Again … raise cash.   It’s a good market to be using non-directional strategies.  If you can trade the smaller time-frames, by all means, do so as you keep an eye on those money management stats.   Union Pacific (UNP) has paused a bit here, but until I see a daily close above $95.00, I’m not even interested in buying more.   

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