The Fund is about 95% invested in 2 Short-Term Bond ETFs (45%) and 35 Individual Stocks (50%) with 5% in Cash. I continue adding to positions at opportunistic buy points and taking on new positions as they present themselves. I try to buy the best “merchandise” (stocks) in the strongest sectors and hold them until they no longer meet my expectations. The Software and Medical Sectors are our biggest weightings and those themes seem to be very much in favor among institutional investors. When institutions decide to buy into a new theme or sector, they tend to leave big “foot-prints” as they accumulate shares. I try to follow in their “foot-steps” and ride the “wave” until it fades. As I see it, institutions are in the “accumulate” mode and so am I, until ……the trend changes.
I like what I am seeing in the market as prices head higher on higher volume. All of the major market indexes have moved to their highest level on strong volume since the Christmas-Eve low. The S&P 500 finally pierced through the “2800” level successfully after three previous attempts. The small-cap Russell 2000 Index is the only major index trading below its 200-day moving (dma) average and could be ready to play “catch-up” as it “huffs and puffs” to stay above its 20-dma. The S&P 500 is only about 3% from its all-time high and I believe “the high” will serve as a level of resistance. However, the market seems to be firing on all cylinders and a favorable China trade deal could be the catalyst to launch the market past this next level of resistance. Junk Bonds are also trending higher and that tells me that investors have an “appetite for risk”. The Semi-Conductor stocks are starting to “lead” again and that has historically been a good sign for a stock market advance. Of course, anything can happen, and I will do my best to stay invested during the major up-trends and avoid life-changing loses.
The most recent pullback now looks like it was nothing more than a ‘buying opportunity within an ongoing bull market. The NASDAQ was up 10 straight weeks in a row since the December low, so I was not surprised to see a down week 2-weeks ago. Last week was an up week for the NASDAQ Index and we could be back “off to the races”, again. The market likes to climb a “wall of worry” but during a bull market the focus should be to “maintain long exposure” and avoid the temptation to “short” just because we are near all-time highs. The market appears to be in a “giving” mode so we will take what the market gives because one-day the market will not be so generous. I plan to take it one-day at a time and “let it ride” until the trend starts to bend in the end. We are just surfers riding the wave and our ability to make money is largely due to the size and extent of the wave, and not solely on our own magical abilities. We can control the risk we take, and the market determines the return we receive. My job is to keep it simple and try to stay on the right side of the trend because the “trend is your friend until the end”.
It appears that global central banks may be expanding their money supplies again. Central banks were in a “tightening” mode, but they may be shifting back to an “easing” mode. They are trying to boost their sluggish economies especially the European Union (EU) as Britain prepares to exit (Brexit) the EU at the end of March. The people voted for Brexit, but their congress does not want to honor the will of the people because government thinks they know better than the will of the people. Does that sound familiar?
Bottom line: I believe in consistency, simplicity and discipline and my job is to manage risk. I believe risk is low and I am looking to increase exposure as I find new opportunities. I plan to keep “pulling the weeds” (selling my losers) and “pruning my flowers” (adding to my winners) in order to “keep my garden growing”. The market tends to take the “stairs up” and the “escalator down” so I never want to become complacent and stick my head in the sand and ignore risk. I believe that “Risk Management” is the key to long-term success in the market. I try to remain open minded and I am not afraid to change my mind.
Investors should carefully consider the investment objectives, risks, charges and expenses of the Issachar Fund. This and other important information about the Fund are contained in the prospectus, which can be obtained by calling 1-866-787-8355 or visiting https://www.issacharfund.com. The prospectus should be read carefully before investing. The Issachar Fund is distributed by Northern Lights Distributors, LLC., member FINRA/SIPC.
Horizon Capital Management Inc, Inc is not affiliated with Northern Lights Distributors, LLC.
Important Risk Information
Mutual Funds involve risks including the possible loss of principal.
The Fund may hold cash positions when the Adviser feels that the market is not producing returns greater than the short-term cash investments in which the Fund may invest. There is a risk that the sections of the market in which the Fund invests will begin to rise or fall rapidly and the Fund will not be able to sell stocks quickly enough to avoid losses or reinvest its cash positions into areas of the advancing market quickly enough to capture the initial returns of changing market conditions. The Adviser’s judgment about the attractiveness, value and potential appreciation of particular asset classes and securities in which the Fund invests may prove to be incorrect and may not produce the desired results.
Investments cannot be made in an index. Unmanaged index returns do not reflect any fees, expenses or sales charges. Past performance is no guarantee of future results.
NASDAQ Index is an electronic traded listing of over 5,000 active large and small companies.
Russell 2000 Index is a small-cap stock market index of the bottom 2,000 stocks in the Russell 3000 Index
NLD Review Code: 4394-NLD-3/18/2019