The Issachar Fund is lightly invested in these Sectors: Building, Chemical, Energy, Finance, Metals, Real Estate, Retail, and Transportation. It feels like the market does not want to go down as it churns higher on low volume. Bad news hits the market, and it seems to shrug it off after a day or two. This may be a good sign that more buyers want to get in than sellers want to get out. I hope to get more invested, but I want to see if our current positions can continue to pull us higher. Lately, it seemed like one step forward and two steps back, but that may be changing now that the Fed has stepped on the gas. (There is no guarantee that any investment will achieve its objectives, generate positive returns, or avoid losses.)
The Fed jacked up its balance sheet by another $92 billion last week to another all-time high! Wow! I thought the Fed would have slowed its money creation experiment after a shockingly higher CPI and PPI print the prior week, but it did not. Instead, the Fed created more money to buy more bonds hoping to keep rates near zero to spur economic growth. It appears the Fed is more concerned with getting unemployment lower than with the inflation bubble they may be creating. I believe the Fed will overshoot its target, and we will end up with higher inflation and higher unemployment, but we are not there yet. So, let’s enjoy the ride and make some hay while the sun is still shining. I do not see this unprecedented money creation “experiment” ending well. Therefore, there will likely be a price to pay for all this unchecked spending, but I believe there will be warning signs for those with eyes to see and ears to hear.
The dollar bounced higher off its 9/20/18 and 1/6/21 line of support! If the dollar fails at this major support level, we could see a steep decline in the dollar and a sharp selloff in the stock market. Higher inflation typically leads to higher rates which supports a higher dollar, but the dollar looks weak. I am concerned the market may be telling Biden that his radical spending has gone too far. Gold has been considered an inflation hedge, so maybe it is time to reconsider gold. Watch gold for a potential buy.
Bottom Line: Issachar is treading lightly, hoping to increase exposure if our positions continue to advance. The Fed-induced liquidity seems to be flowing in selected stock market sectors. The market appears to be rewarding the lower P/E stocks with accelerating earning and sales, so that is where we are for now. I believe rising rates are a sign of rising inflation, and as “real” interest rates move further into negative territory, we could see gold become a “safe haven.” Only God knows the future, so I try to rely on His Wisdom to guide His Fund in the right direction.
May the God of hope fill you with all joy and peace in believing, so that by the power of the Holy Spirit you may abound in hope. Romans 15:13
Links: Fact Sheet Performance PodCasts Blogs Strategy My Story Docs BRI/ESG
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. (HCM) is not affiliated with Northern Lights Distributors, LLC.
Important Risk Information: Mutual Funds involve risks, including the possible loss of principal. An investment in the Fund may not be appropriate for all investors. 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 incorrect and may not produce the desired results. Past performance is no guarantee of future results. Ratings are only one form of Fund performance and should not be used as the sole consideration in making an investment decision. Opinions expressed are subject to change and are not guaranteed, and should not be considered investment advice. For more information regarding the fund, including current performance, please visit www.IssacharFund.com. Review Code: 5260-NLD-5/24/2021.