Dear Investor,
Welcome to another Macro Monday at Hedgeye. Our analyst team has already measured and mapped global markets to help you risk manage your portfolio through the volatility ahead. Below is a small glimpse of the actionable investing insights our research team delivers every day—designed to help you safeguard and grow your portfolio.
Here are the Top 3 Things to watch this week:
- Inflation Rising – Oil and gas prices are surging. WTI is hitting new highs. Natural gas jumped over 15% last week. CPI data on Wednesday is likely to come in hotter than expected, aligning with our 2.95% inflation forecast.
- Rates – Higher inflation means the rate cuts Wall Street was banking are becoming less likely. That means Long US Dollars (Bullish Trend) against the Euro, Japanese Yen, and other fiat currencies. It also means rate-sensitive equities such as REITs (-4.4% last week alone) will likely struggle.
- Volatility (VIX) – The reality of higher-for-longer inflation (and the higher interest rates as a result) is making Wall Street nervous. The S&P 500 broke its key TREND signal support on Friday, with 87% of its stocks down over 2%. Meanwhile, the VIX spiked, signaling more turbulence ahead.
Chart of the Day: Are You Prepared for Inflation?
Investments tied to rising prices—like oil, natural gas, copper, and corn—are outperforming in this inflationary environment.
Reality is that most people (especially if they’re in the Old Wall 60/40 “portfolio”) are getting smoked again.
How do you get smoked in a portfolio that’s 60% US Stocks and 40% Treasury Bonds? A) You have no inflation protection (like being Long of USD and Commodities).
What to Buy & Sell: Position for Inflation
The Hedgeye playbook is simple: focus on what works in inflationary and rising rate environments while avoiding vulnerable assets.
- Buy Inflation-Resilient Assets – Energy and agricultural commodities like oil, natural gas, and corn are seeing strong gains.
- Short Rate-Sensitive Assets – Sectors like long-term U.S. Treasuries (TLT) remain challenged by higher rates.
- Important – Don’t jump into these assets without proper multi-factor risk management! Wait for Hedgeye’s Risk Range Signals to turn BULLISH or BEARISH—then make your move.
Real-Time Alerts gives you exclusive intraday Buy/Sell/Short/Cover signals from Hedgeye CEO and former hedge fund manager Keith McCullough. Subscribe here.
Fact of the Day:
The U.S. National Debt Is Exploding.
- The total debt is now $36 TRILLION.
- That’s $107,000 for every American.
- The debt grows by more than $2 billion every day.
This rapid debt expansion adds further pressure to an already inflationary environment, making it even more critical to position your portfolio accordingly.
Take Action with Hedgeye
Navigating this challenging market requires more than just intuition—it demands a disciplined process and the right tools. Hedgeye’s suite of investing products, from Real-Time Alerts to The Macro Show, equip you with actionable, data-driven insights to stay ahead of the game.
To Your Success,
The Hedgeye Team
