TAARSS says prefer Global Equities and Short-term bonds in Q3 Deutsche Bank – Synthetic Equity & Index Strategy – Global The Flow Whisperer – TAARSS says prefer Global Equities and Short-term bonds in Q3
Tactical Asset Allocation Relative Strength Signal (TAARSS) Monthly Update
Top recommendations for July: Japan, Europe, US Commercial Banks, and US Healthcare.
Market review
Global equities and bonds were under pressure during June. Global equities (ACWI) and US Bonds (AGG) fell by 2.57% and 1.08%, respectively; while Commodities (DBC) advanced by 1.64%
TAARSS rotation strategy monthly and quarterly performance review
Most quarterly and monthly TAARSS strategies presented weakness across the board during Q2 and June 2015, respectively.
Tactical positioning for Q3 and July 2015 based on TAARSS
For Q3 we clearly prefer Global Equities, while staying neutral to Bonds and away from Commodities. Within Bonds we have seen a clear shortening of the duration in investors’ portfolios, therefore we recommend staying in short-term debt products this quarter.
This month in global equity markets prefer Intl DM, stay neutral to the US, and away from EM. Region wise prefer Europe and Asia Pacific, with neutral North American exposure, while staying away from Latin America. In US equities we resume the small and mid cap over large cap theme. Sector wise we see more resilience and support in Healthcare and Technology. In Intl DM countries prefer Japan. Within EM countries, we see South Korea as the only silver lightning currently. In Fixed Income and Commodities we don’t see any strong readings. See Figure 13 and Figure 14 for full allocation details.
