CHART OF THE DAY: The Only Process That Gets You Out of Major Asset Allocation Crashes

The chart below is from today's Early Look by Hedgeye CEO Keith McCullough. 

Since we signaled bearish on The Cycle (in January 2022):

• The UST 10yr Yield has gone from 1.5% to 5% at its Cycle Highs
• The Russell 2000 has crashed from 2442 to 1651 from its Cycle Peak

If you have friends who haven’t done the math on that in their “60/40” 401(k)s yet, here’s part of it:

• BONDS: Long-term Treasuries (TLT) have crashed -44% from their 2021 Cycle Peak
• STOCKS: A broad basket (Russell 2000) has crashed -32.4% from its 2021 #MOAB Cycle Peak
• Even the QQQ re-entered Crash Mode yesterday, at -20.2% from its #MOAB Cycle Peak

If your hard-earned capital crashes -20%, you need to be up +25% (from here) to get your money back to breakeven.

If you’re down -44%, you need to be up +78% to get back to breakeven.

Our goal isn't to sugar coat things, but to help you risk manage your hard-earned capital.

Amid all the crashes, our new Long Only Portfolio Solutions product was UP yesterday. Subscribe here and pull back the curtains on Keith McCullough's Long-only portfolio.

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