Insight is Capital™ Podcast

Darius Dale, Chief Strategist & Founder at 42 Macro LLC joins us for an end of Q3 360˚ take, looking back at the last year for context, and looking forward to 2024. He shares his insight from his firm's econometric modeling, and what it is all saying about the economy and markets behaviour for the upcoming quarters and year ahead. Dale eloquently unpacks all the factors driving inflation and market in the context of today's heightened uncertainty surrounding inflation, policy, rates, and market dynamics.Timestamped Highlights[00:02:25] Darius Dale believes that factors supporting growth persist into next year, inflation has surprisingly decreased, and the Fed's policy remains unchanged.[00:04:19] China's economy reopening without fiscal stimulus, Europe's growth faltering with sticky inflation causing bond market volatility. Bank of Japan likely to tweak yield curve control. Implications for asset markets.[00:06:55] Despite concerns about inflation, consumer income and personal spending have exceeded inflation levels. Limited vulnerability in the credit cycle and decreased exposure to the manufacturing sector indicate a more resilient economy.[00:13:17] Darius Dale's insight, discussing a temporary risk-off scenario, the expectation of a return to equity leadership, and the potential lag in seeing the impact of interest rates on the economy. The author questions whether these circumstances will lead to a leapfrogging of debt maturity.[00:16:41] Stock market tends to peak with employment cycle, indicating potential retail risk accumulation. Difficulty in answering question of factor dispersion.[00:20:09] University of Michigan employment survey shows numbers inconsistent with recession patterns. Other indicators also suggest recession is unlikely.[00:22:14] Most US mortgage holders have 30-year mortgages at low rates, so rising interest rates will take time to impact the housing market.[00:26:04] There have been few changes in central bank policy rate expectations, but significant moves in floor policy rates, led by the US. The US economy has been performing better than expected, causing investors to believe there is no recession. The fixed income market has seen interesting trends, with minimal impact from the regional banking crisis.[00:30:48] High interest rates will discourage refinancing for both corporate and household sectors; longest duration since the early 80s.[00:31:53] Refinancing into higher interest rates is economically irrational. Rates will matter eventually, but not now. The Fed's policy has created a big spread between payments and instrument yields, dragging it into a higher rate regime.[00:35:27] The mortgage rate spread is causing stagnation in the housing market, leading to a decrease in existing home sales and an increase in new home construction.[00:40:37] We discuss the potential for higher inflation and the use of a model to project inflation trends. It suggests that the underlying trend of inflation may be around 2.5% to 3%.[00:44:07] The author specializes in building quantitative models backed by proven techniques. They developed an investment strategy to outperform the standard 60-40 approach by reducing bond holdings and using various risk management overlays.[00:48:50] We discuss the inflationary era in bond market, potential for term premium to rise, bond bulls buying undervalued market.[00:52:05] 42 Macro publishes research and prognostications on the market. They made successful calls in early January and May based on their process. They focus on behavioral aspects and reorganized their process for better outcomes.Visit 42macro.com for more.

Terry Dimock, Chief Risk & Execution Officer, at National Bank Investments is our guest. In this episode, Terry takes us on a journey through NBI's OP4+ Open Architecture Investment process and framework, shedding light on the importance of creating value, the prioritization of organization, people, and process, and the meticulous monitoring of portfolios. Terry shares valuable insights into the selection of portfolio managers, the logic of integrating ESG factors, and the challenges and opportunities in the ever-changing investment landscape. We explore the inner workings of NBI's investment management process and discover how they navigate the complexities of the market to deliver exceptional results for their investors.Timestamped Highlights:[00:00:00] Opening remarks and introduction to Terry Dimock, a luminary in investment management.[00:04:37] In 2012, National Bank sold its asset manager and adopted an open architecture approach to build solutions using the best portfolio managers in the world. They created OP4+, an acronym that defines what they look for in a portfolio manager, with "O" standing for organization.[00:07:00] Where does value come from? How value is created, and the importance of people and process. Terry explains the pillars of OP4+ and monitoring portfolio positions. The goal is to ensure that the process is followed and glitches are avoided.[00:10:03] How are NBI's sub-advisor portfolio managers evaluated? Terry emphasizes the importance of portfolio manager selection, and the under-recognition of the risk involved is discussed. We discuss his team's role at National Bank Investments in reducing advisor and client burden in evaluating managers.[00:13:13] The CIO office uses teamwork to identify asset classes and portfolio needs. They may add or change managers to diversify portfolios. NBI's Open Architecture allows flexibility in adding a multitude of asset classes and managers.[00:16:21] We seek the best portfolio managers with a long track record, particularly in less liquid investments. Fees in these categories can be high, but we value diversification, careful selection, and scale.[00:19:28] Quarterly performance attribution calls are held with all portfolio managers to assess performance and confirm adherence to OP4+ process. Bi-weekly check-ins and yearly on-site visits ensure trust and accuracy in information provided.[00:24:29] Investors should consider environmental risks and the management of companies they invest in. For example, PG&E faced lawsuits and bankruptcy due to poor management after 2019 forest fires. Analysts reduced positions in companies with high risk and poor governance. It is important to analyze potential risks and ensure investment aligns with environmental objectives to avoid negative outcomes. Considering and factoring in ESG concerns was a logical decision.[00:28:10] Terry emphasizes the need for a transition to renewable energy, ensuring job security and sustainable business practices, despite political opposition.[00:29:56] Investors should use ESG to make credible and accountable decisions. Becoming a signatory of the UN principles for responsible investment demonstrates seriousness. Proof points about using ESG factors are necessary.[00:33:57] We assess performance criteria and compare active managers to ETFs to ensure value for end-investors. Focus on process, not short-term metrics.[00:36:25] Gaps in portfolio, lack of diversity, and changes can unearth reasons to lose confidence in a portfolio manager's inclusion in NBI's program.[00:41:11] AI, like ChatGPT, will enhance analysis and automation, allowing focus on critical tasks. Progress in technology has consistently improved efficiency. Younger generations adapt quickly.[00:43:22] Terry closes the conversation noting that NBI is constantly working at improving qualitative and quantitative aspects of the OP4+ process, focused on finding the right information and metrics for future success.=======================Where to find Terry Dimock=======================Terry Dimock on LinkedinNational Bank InvestmentsCopyright © AdvisorAnalyst.com

The head of the Doomberg team, maestros at deciphering the complex symphony of the financial world is our guest. The Doomberg team are well-known for their uncanny ability to recognize patterns before they emerge and connect the dots between topics you'd never think related. They've mastered the art of making the intricate realms of finance accessible. They have become, by far, the most popular Substack. Doomberg join us for a deep, deep dive into their most recent market insights, highlighting the less-than-obvious dualities, contradictions, impacts, and connections in the realm of financial markets.Timestamped Highlights:[00:02:07] Doomberg, a small team with experience in the commodity sector launched Doomberg in 2021, now the most subscribed Substack, after pivoting from a consulting firm due to COVID-19. They now research and write 7 to 8 pieces a month with no strict deadlines.[00:08:37] A framework for assessing scientific breakthroughs, focusing e.g. on a claimed room temperature superconductor. It emphasizes the importance of considering the credibility of those involved, where the research is published, the scientific process, the context of previous claims, and what to expect next. Ultimately, the text expresses deep skepticism and the need for more evidence.[00:19:37] The potential benefits of a technical singularity, including advancements in grid rewiring, quantum computing, and high-tech electronics. It highlights the difficulty in predicting the specific inventions that could arise and the significant impact it would have.[00:24:59] Doomberg discusses the relationship between energy, order, and standard of living. He argues that higher energy density leads to economic prosperity and that restrictions on fossil fuel consumption merely shift the privilege. The global south's consumption of fossil fuels is seen as predictable and sustainable within the author's framework.[00:30:36] The progressive environmental left opposes nuclear power and carbon capture for reasons related to their desire for fewer humans (Malthusians) and resource conservation. They want less energy and advocate for intermittent renewables. Their intentions are not about carbon emissions.[00:39:29] In periods of energy abundance, currencies are influenced by manufacturing performance and value-added capabilities. In energy scarcity, energy becomes the key resource, affecting currency strength. During shortages, energy producers profit from price increases. The understanding of energy's significance reveals the less relevance of currency fluctuations. A mild winter in 2022 shifted to energy abundance, causing coal, natural gas, and oil prices to drop, impacting currencies. Russia's currency weakens during surplus energy periods. Energy positioning explains most currency moves during scarcity, but not during abundance. Currency serves as a means to store, transport, and utilize energy.[00:45:21] Ontario's Green Energy Act caused government waste and enriched insiders, costing taxpayers billions. In 2018, the ruling liberal party was ousted, and the act was revoked. Ontario now focuses on nuclear energy.[00:52:29] Canada, UAE, and Japan are embracing nuclear power, while most of Europe except Germany is realizing its importance. Pain and political change are necessary for progress.[01:00:06] Traditional media outlets claim both that drought relief disproves climate change and that climate volatility is the cause.[01:04:11] The story of Tulare Lake. A California tribe's devastated loss when their lake was drained by dams and diversions, is now seen as a climate crisis causing flooding. The reclaimed lake is viewed as both a salvation and a food growing paradise lost due to climate change.[01:08:16] The book "The New Dealers War" is recommended and highlights China's dominance in key industries and the need for caution in foreign engagements.[01:14:26] The US lacks knowledge, China controls Tellurium supply in solar industry.[01:20:00] Focus on leadership at home, support US prosperity, influence policy, cautious about China, not worried about physical safety. US political system intact despite partisan bickering.==========================Where to find Doomberg:==========================Doomberg - Substack=======================Where to find the Raise Your Average crew:=======================ReSolve Asset ManagementReSolve Asset Management BlogMike Philbrick on LinkedinRodrigo Gordillo on LinkedinAdam Butler on LinkedinPierre Daillie on LinkedinJoseph Lamanna on LinkedinAdvisorAnalyst.com

Paul Kornfeld, President at SIACharts joins us for an comprehensive update featuring SIACharts' insights - we talked about relative strength rankings and how they can guide your investment decisions globally. Small-cap stocks in the US may be lower ranked compared to their large-cap counterparts, but Canadian small-cap stocks are showing promise. We also discussed the movement in energy markets – they've been on the decline but set for gains, while alternatives have been gaining momentum. And fixed income? While it hasn't shown much improvement, it's waiting for that bounce back when interest rates start dropping. Stay away from underperforming areas, follow the analysis, and keep an eye out for sector opportunities in Canada and the US. And, we even explored potential investment opportunities in Mexico, and India. These countries are aligning with western interests, less vulnerable to China's influence, and have charts showing clear breakouts. Timestamped Highlights:[00:03:24] We discuss discuss market performance, interest rates, inflation.[00:10:48] Market recovering, room for growth, market breadth.[00:15:17] Mega-cap tech stocks dominate market returns. Breath problem persists. Financial recovery underway. Transportation sector improves. Sector flows signal concerns. July historically positive, but caution for August-September.[00:26:48] Seasonality varies across different market areas. Building an ensemble of indicators is important. Market could be overbought and a bit exuberant. Consider tightening risk levels and taking profits. Summer seasonality may present challenges.[00:30:02] Expectations for Q4 earnings are changing, with certain sectors predicted to have higher earnings. Information technology remains strong, while utilities have surprisingly high expectations.[00:36:00] Stocks lagging, utilities messy, no clear trends[00:44:11] Rankings show US outperforming Canada due to sector composition.[00:46:50] Global, Europe, international, US Small Cap, Canadian Small Cap, energy markets, alternatives, North American Equity, emerging markets, fixed income, bond valuations, underperformance, sector analysis[00:53:07] Real estate market booming in Calgary.[00:56:58] Price expected to pause at resistance level. Support at 125. Potential move down 1%. Resistance at 139. Range between 128 to 138. Short-term outlook weakened. Not bullish for USD.[01:03:10] US has performed well, Nasdaq has potential.[01:09:15] Point figure chart eliminates short-term noise. Candlestick chart has more noise. Point figure chart shows value in different time periods. Visuals help identify upside and levels. Long-term view is important. Russell 2000 chart is noisier with a smaller range.[01:13:06] International markets have potential, particularly Argentina, Mexico, and India. Emerging markets may catch up with developed markets.[01:20:33] Security mindset challenges, breakout opportunities, orderly uptrend. Reassuring narrative: supply chain shift to aligned countries. Risk management and accumulation strategies. Pay attention to new highs in portfolio.[01:36:42] Summarizing the text in 6 words: Simplified commodity strategy with low volatility.[01:40:41] Increased dispersion across asset classes creates opportunities.======================Where to find Paul Kornfeld and SIACharts:======================Paul Kornfeld on LinkedinSIACharts.comSIACharts on TwitterSIACharts on Linkedin=======================Where to find the Raise Your Average crew:=======================ReSolve Asset ManagementReSolve Asset Management BlogMike Philbrick on LinkedinRodrigo Gordillo on LinkedinAdam Butler on LinkedinPierre Daillie on LinkedinJoseph Lamanna on LinkedinAdvisorAnalyst.com

Meketa Investment Group, a consulting company with a rich history, wants to make the complicated language of investing easier for everyone. In this episode Jason Josephiac and Ryan Lobdell of Meketa Investment Group discuss the educational paper they released this year that tries to clear up much of this confusion. They note that calling something a "hedge fund" is a bit like saying "sports" without saying which sport you mean - which could be anything from football to car racing (think football ≠ car racing). Just like in sports, it's important to have a well-rounded team with different strengths, and Meketa's Josephiac and Lobdell want to help investors do this with their investments.Our conversation delves into how the best teams have both a strong attack (offense) and a strong defense. It's the same with investing. If your investments are all attacking (basically going after growth), you might be taking on more risk than you think and leaving yourself open (to being attacked) on the defense side. This might mean you're not set up as well as you could be to consistently do well. They also point out that some programs that are supposed to protect you (like playing defense in sports) might not really be doing that job well. We discuss all of the accessible investment tools and strategies an investor have at the ready to build a championship level portfolio.Thank you for listening.Where to find Ryan Lobdell & Jason Josephiac:Ryan Lobdell on LinkedinJason Josepiac on LinkedinRead the whitepaper: Risk Mitigating Strategies (RMS) Framework

Recorded June 23, 2023 - Recorded June 23, 2023 - In this conversation, Pierre Daillie talks with Hugh Hendry, Founder, Eclectica Macro, a.k.a The Acid Capitalist, about the current financial landscape. They discuss topics such as the debt ceiling deal, the fear of supply, the rise of tech stocks, the appeal of long duration treasuries, and the deficiency of demand caused by China's oversupply. They also touch on the impact of Xi Jinping's policies and the posturing between China and the US. Overall, the conversation highlights the potential risks and opportunities in the global financial system. In this conversation, Hugh Hendry discusses the wealth destruction caused by the flat stock market and the growing debt problem with China. He highlights the symbiotic relationship between the Communist Party of China and Wall Street, as well as the conflict of interest in US capital markets. Hendry emphasizes the importance of trend in trading and shares his investment strategy, including the allocation of assets such as stocks, treasuries, and Bitcoin. He also discusses the potential opportunities in long bonds and the glitch at Boeing, and a trade in Apple.TAKEAWAYSThe fear of a synchronized global recession and the potential impact on the financial markets.The appeal of long duration treasuries as a safe haven asset in a potentially weakening economy.The concentration of market gains in a few mega cap tech stocks and the potential risks of a market correction.The impact of China's oversupply on global markets and the deficiency of demand caused by their trade surplus. The stock market is flat, causing wealth destruction.There is a symbiotic relationship between the Communist Party of China and Wall Street.US capital markets have a conflict of interest that prevents them from addressing the real market problems.Trend is crucial in trading and asset allocation.KEY TIMESTAMPS[00:00] Introduction and Setting the Stage[02:31] Debt Ceiling Deal and Liquidity Concerns[03:44] The Fear of Supply and Risk Aversion[05:29] The Rise of Tech Stocks and Riskless Securities[07:02] The Appeal of Long Duration Treasuries[07:36] Inflation and Real Rates[09:36] Mean Reversion and Treasuries[11:44] The Market's Dependence on Mega Cap Tech Stocks[13:29] The Hated Rally and Missed Opportunities[14:38] The Belief System and Valuation of Stocks[16:09] The Coiled Spring and Potential Correction[19:45] Debt Ceiling and the Chinese Economy[20:34] Mutually Assured Destruction and Debt Ceiling[24:35] The Deficiency of Demand and Chinese Oversupply[29:18] The Impact of Xi Jinping's Policies[37:57] China's Wealth and Posturing[39:21] The Wealth Destruction[40:35] The Real Problem with China[41:39] The Symbiotic Relationship between China and Wall Street[42:43] The Monetary Policy of the US[43:50] The Conflict of Interest in Capital Markets[44:45] The Search for Equilibrium[46:33] Investment Strategy: Quadratic Expression[47:52] The Role of Cash in Asset Allocation[49:52] The Potential of Bitcoin[51:39] The Relative Sizes of Gold and Bitcoin[55:26] The Correlation between Bitcoin and NASDAQ[57:19] The Importance of Trend in Trading[58:47] The Decline of Hedge Funds[59:23] The Glaring Opportunity in Long Bonds[01:02:24] A Parallel with 2003[01:03:39] The Conflict of Agendas[01:06:22] The Glitch at Boeing[01:11:27] The Most Glaring Opportunity[01:13:49] Where to Find Hugh HendryHIGHLIGHTSThe Magnificent Seven Stocks:Hendry notes that in every major bear market, certain stocks, referred to as the "Magnificent Seven," are perceived as being independent of broader market trends. These include companies like Nvidia and AMD, considered less economically sensitive within equity allocations.He draws parallels between the valuation of these stocks and Bitcoin, suggesting that their market value is more influenced by belief systems than traditional financial metrics, similar to how art is valued.Hendry discusses the valuation of the U.S. stock market, highlighting its size relative to the GDP and expressing skepticism about overly optimistic market projections.He mentions a cautious investment approach, allocating about 15% of his portfolio to these specific stocks, emphasizing the importance of following market trends in his investment decisions.On US Treasury Bonds:Hendry addresses concerns about the U.S. Treasury issuing a large amount of bonds and its impact on prices.He draws parallels with the 2008 financial crisis, noting the importance of confidence in collateral, which often includes U.S. Treasury bonds.Hendry observes a mean reversion in Treasury prices, suggesting that current trading levels are relatively rare and could present buying opportunities.On China:Hendry discusses the probability of a confrontation between China and Taiwan, expressing concerns about the increasing likelihood of such an event.He critiques China's economic growth, labeling it as 'fake growth' and pointing out that despite the appearance of progress, real wealth creation has been lacking.Hendry also touches on China's role in global trade and economic imbalances, particularly how it redistributes wealth within its economy and buys financial assets in the United States.We discuss the symbiotic relationship between the Communist Party of China and Wall Street, suggesting both have prospered in the current environment. As a result, there is no desire on Wall Street for the was the US manages its Capital Account.On Bitcoin:He talks about the changing correlation between Bitcoin and NASDAQ, suggesting that such correlations can be misleading.Hendry expresses interest in investing in Bitcoin, particularly as its value had significantly decreased.He discusses Bitcoin's potential for growth, considering its market size relative to the larger segment it belongs to.Hendry likens Bitcoin's valuation to a belief system, similar to how art is valued.Copyright © AdvisorAnalyst.com

In this episode we welcome Peter Bowen and Michelle Munro from Fidelity Investments Canada, two leading minds in the field, to discuss their insights and discussing the findings from the recent 2023 Fidelity Retirement Report.Today's financial climate is more complex than ever. The cost of living continues to rise, and market volatility seems like the new norm. Yet, amidst all of these challenges, Canadians are maintaining an optimistic outlook towards retirement, thanks in part to sound financial planning and advice.Fidelity Investments Canada' 2023 Fidelity Retirement Report, now in its 18th iteration, is a vital resource for financial advisors and investors alike. It aims to shed light on current retirement trends and offer strategies for both preparing for and living during retirement.The report discusses a wide range of influencing factors, including inflation, housing costs, interest rates, and, of course, market volatility. All of these elements play significant roles in how we plan and strategize for our retirement years.Peter is Vice President of Tax and Retirement Research and Michelle is Director of Tax and Retirement Research at Fidelity Investments Canada.Thank you for listening. Don't miss what Peter and Michelle have to say about how we can all better equip ourselves for the financial realities of retirement, no matter what changes the market throws our way.Read the 2023 Fidelity Retirement ReportCopyright © AdvisorAnalyst.com

In this episode, BMO Global Asset Management's Jeffrey Shell and Lillian Ferndriger join us to discuss newly accessible opportunities in private market assets. Jeffrey is Head of Alternatives, Commercial ESG and Innovation from BMO Global Asset Management. And Lillian is Director of Alternatives Distribution at BMO Global Asset Management.We delve into the realm of private market investing, now a more widely accessible and vital instrument for portfolio diversification that promises attractive risk adjusted returns.These markets offer an entrance into asset classes and strategies that were previously largely inaccessible territory in the public domain. Moreover, the defining features of private markets, their risk return profiles stand as a powerful key to unlock the full potential of a private wealth portfolio.A look back in time reveals the compelling performance of private markets as they have consistently outshone public markets becoming a beacon of wealth accumulation and differentiated return stream. In recent times, this asset class has been winning hearts transitioning from its longstanding institutional clientele to captivate high net worth individuals, the segment that's been growing the fastest.Now we're witnessing an exciting shift, often referred to as the democratization of access. This transformation marks a significant stride for the wealth management industry as it throws open the doors to a broad suite of previously inaccessible specialized strategies within private equity, private debt, real estate infrastructure, and other real assets.The allure of reduced minimum tickets, enhanced transparency in reporting and lower fees adds to the appeal of these markets. But perhaps the most enticing advantage of this democratization is the boon it provides to private wealth. It serves as the final puzzle piece in portfolio construction, enabling clients to harness and all-encompassing asset allocation in private market sub strategies.This allows for portfolio diversification, enhanced returns, volatility reduction, and crucially a shield against inflation. Today we're gonna delve deeper into these fascinating dynamics of private market investing. Thank you for listening.Where to find Jeffrey Shell and Lillian Ferndriger, BMO Global Asset ManagementJeffrey Shell on LinkedinLillian Ferndriger on LinkedinMore on BMO Partners Group Private Markets Fund.

In this episode, Cole Smead, CEO & Portfolio Manager at Smead Capital Management, which oversees in excess of $5-billion AUM, joins us to discuss markets, the current investment climate, investing, and his firms 8 criteria investing philosophy. Our conversation begins with Smead discussing how he and firm work to uncover underloved, and underfollowed investment opportunities à la Charlie Munger, Peter Lynch and Warren Buffett. We then get into a discussion about the significant differences between value factor investing and what Smead does in its long term investing strategy, both in the US and Internationally. Though Smead's investment strategy is go-anywhere, their current investment darling opportunity is in the energy and commodity complex, where they have uncovered what can only be described as generational opportunities, something Smead has gotten right in the 15 years since William Smead, Cole's father founded the firm, following a long career in the industry, investing on behalf of other firms.Thank you for listening. Smead has an encyclopedic knowledge of both the fundamental and quantitative aspects of investing, so it made for a lot for an enthralling discussion on markets, value investing, making money, avoiding losses through exceptional views on risk management.Timestamped Highlights:[00:02:18] Investment discipline includes 8 criteria developed by Bill Smead reflecting great investors, concentrated portfolios of 25-30 securities, and low turnover. It is a negative art based on eliminating things rather than finding things that fit, and markets change over time.[00:14:47] Various investors needed to outperform by 40% to beat the index at some point. Volatility is unpredictable and there is no ability to price momentum. Understanding individual investment values is unique and cannot be commonly attached to a group.[00:21:27] This text discusses the Jevons paradox and the relationship between technological innovation and energy consumption, arguing that as technology advances, energy consumption increases. The author also emphasizes the importance of having a framework for understanding an unknown future and the impact of energy consumption on economic growth in different parts of the world.[00:23:53] "We've never used less energy doing all these great things in human society with all the ingenuity and all the innovation and all the technology available to us and Devin's really you know his the paradox he he created really pushes back on the scarcity of supply argument as well as the um lack of demand argument because we always have more and more and more."[00:26:47] Investing in renewable energy and solar is necessary due to high energy needs. Market is picking winners and losers, but the need for more of everything is present. Lithium batteries are a great technology but require a lot of energy consumption and deplete metals. Combustion engine paired with electric motor is a feasible hybrid model.[00:36:33] The fear of repercussions for owning certain investments causes portfolio managers to allocate capital based on what is profitable and to avoid "bad commodities." This is leading to a lack of competition and oligopolies in certain markets. Taxing these investments could make them acceptable across society.[00:41:05] "There are those who want to invest in funds that invest in oil and those who don't correct? To your point it appears to be becoming binary where you have  a cohort of investors saying oh no no i don't want fossil fuels in my portfolio and then that's actually creating this huge inefficiency."[00:44:05] The NBA has evolved to favor the three-point shot due to its efficiency, with players opting to shoot from beyond the arc rather than take shots from closer to the basket. Similarly, in investing, easy money strategies like the S&P 500 may no longer be the most rewarding, with riskier investments like commodity-driven businesses and those that align with ESG frameworks offering better returns.[01:01:06] Bear market rally may be misleading, as companies' revenue growth decline due to inflation. Market participants are uncertain about their investments. Potential opportunities in commodity and cyclical businesses, but overall caution is advised.[01:06:48] The next decade will be tough and require perseverance. It will be challenging for all investors and necessary to diversify and stay educated.======================================Where to find Cole Smead and Smead Capital Management======================================Cole Smead on LinkedinSmead Capital Management Blog - Advice BlogSmead Capital A Book With Legs Podcast

Seeking strategies to capitalize on the current market conditions? In this episode, featuring Paul Kornfeld, President of SIACharts, we discuss the utility of a framework to cope with fluctuating markets. We delve into the significance of technical analysis amidst zero interest rates and undervalued fundamentals over the past decade, along with the challenges of risk management during market shifts, such as the current climate of inflation and rising rates.Kornfeld provides an overview of current market conditions, underscoring cautious optimism and a bullish stance on international markets. He also introduces new SIACharts' developments, emphasizing the importance of chart analysis, particularly point and figure charting.He explains SIACharts system, which performs billions of calculations daily, employs point and figure comparison charting to examine the supply and demand dynamics of various asset classes. The system's rankings, based on longer-term trends, are not designed for day trading but to provide forward insights into stocks, ETFs, mutual funds, asset classes, sectors, and model portfolios.The key takeaway is the essential role of tools like SIACharts in offering immediate and ongoing guidance to navigate markets. Using charting analysis to highlight investment opportunities, it liberates advisors from daily analysis rigors. SIACharts aids in identifying top investment prospects and offers risk management tools to minimize drawdowns and enhance the total capture ratio.<strong>Thank you for listening!</strong><h2>Timestamped Highlights</h2>Importance of having a framework to navigate changing market conditions [00:00:15]Importance of charting analysis and point and figure charting [00:02:05] The usefulness of charting analysis and point and figure chartingShift in market leadership [00:08:04] The speakers discuss the importance of having an exit plan and tools to adjust one's narrative.The winter of discontentment [00:10:31] Paul Kornfeld talks about the quarterly outlook and recap, called "The Winter of Discontentment."Concentrated Market [00:17:41] Discussion on the current market conditions, including the concentration of the market and the performance of underlying stocks.Asset Allocation and Risk Management [00:18:30] Importance of having a framework to navigate changing market conditions.Asset Class Rankings [00:23:17]Point and Figure Comparison Charts [00:24:09] Explanation of the methodology behind the rankings.Identifying Long-Term Trends [00:26:31] Importance of longer-term trends in the market and how the rankings help advisors make informed decisions for their clients.European stocks and international opportunities [00:30:56] The speakers discuss the surprising performance of (surprise) European stocks despite the ongoing war and energy vulnerability.ETF country heat map tool [00:33:17] Paul Kornfeld introduces the new ETF country heat map tool, which visually shows the performance of different countries and sectors over timeframes.Following the money [00:38:04] The speakers discuss the importance of following the money and tracking money flowsAvoiding hitting bottoms [00:39:27] Importance of avoiding dead money in the portfolio and staying out of trouble.Sector analysis [00:40:23] Using charting analysis to visually see the money flowing in and out of markets and the importance of sector analysis.Short-term overbought/oversold [00:43:06] Understanding short-term overbought/oversold sectors, portfolio weighting and timing.Using the Reports Tactically [00:48:28] Paul Kornfeld encourages advisors to use the reports tactically as a confirmation tool for allocation decisions.Staying Away from Banking [00:49:24] Paul Kornfeld provides an example of how the reports e.g. helped advisors avoid sectors like banking, which has been red since December and has fallen by 18% over the last quarter.Finding Opportunities in the Market [00:50:54] Paul Kornfeld discusses using a top-down approach and combining sectors to find the best names.Eliminating Guesswork with Relative Strength [00:52:53] We discuss how using relative strength eliminates guesswork and biases when deciding where to invest.Saving time in volatile markets [00:56:51]Reservations about technical analysis [00:59:25] Paul Kornfeld addresses two reservations about technical analysis.Using SIA Charts to empower advisors [01:05:13] Paul Kornfeld discusses how SIA Charts can empower advisors.(One of) SIA Charts' Most Valuable Feature [01:08:59] Paul Kornfeld discusses the most valuable feature of SIA Charts.Risk Management and Analytics [01:10:34] SIA Charts' biggest value add is risk management, which is not talked about enough.Simplifying analysis for advisors [01:16:12]======================Where to find Paul Kornfeld and SIACharts:======================Paul Kornfeld on LinkedinSIACharts.comSIACharts on TwitterSIACharts on Linkedin