Market Update: 07-12-21

Earnings Season Starts!      Fully Invested!   

The Issachar Fund is fully invested in growth stocks in the Energy, Medical, Retail, and Software Sectors.
2nd quarter earnings season kicks off this week, and I expect earnings to come in better than expected, providing a catalyst for the market to trend higher.  The reopen trade seems to be fading, and the growth trade, especially in the cloud space, appears to be in favor.  Treasury yields have been declining since March, which tells me that economic growth will not be as robust as expected, and inflation may be transitory like the Fed indicated.  I do not believe we are headed for negative rates like in Europe.  However, the Fed distorts many historical norms by purchasing unprecedented amounts of bonds, so negative rates are a concern.  Higher bond demand increases bond prices, creating lower yields, so a considerable portion of the Treasury yield decline could be a function of the Fed’s money creation experiment.  If that is the case, I expect the economy to slowly recover while growth stocks continue to be accumulated, which could bode well for Issachar. (There is no guarantee that any investment will achieve its objectives, generate positive returns, or avoid losses.)

Last week, the Fed increased its balance sheet by $19 billion to an all-time high of over $8 Trillion!  This newly created money has to go somewhere, and a lot of this “free” money is finding its way into the major stock market indexes.  Last Thursday, the market gapped down but recovered about half of its losses before the close.  Then on Friday, the market gapped higher and finished strong.  After critical historical post-trade analysis, I have tweaked my strategy to avoid “risk management” selling during steep declines while in a confirmed uptrend with an accommodative Fed.  I believe this change will help improve performance.  I have been blessed with a teachable spirit that strives to get better so God can be glorified.

Bottom Line: Issachar is fully invested as earnings season begins, and I expect the bull market to continue.  The Fed remains accommodative, giving me great conviction to go with the flow and not “fight the Fed.”  I believe growth stocks will continue to lead the market higher, and the value/cyclical stocks will lag.  If I am right, Issachar could do well.  If I am wrong, I do not plan to stay that way.  I rely on God’s Wisdom daily to help make the right decisions to prosper His Fund and bring honor to His Son, Jesus. 

Whatever you do, do all to the glory of God.  1 Corinthians 10:31

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, obtained by calling 1-866-787-8355 or visiting 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: 5385-NLD-7/12/2021.

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