January’s record setting SP500 performance came in at -8.6%, and good margin past the prior record of -7.7% in January of 1970. Interestingly, on a peak of the month to the trough of the month basis, the SP500 dropped from 934 on January 6th to 805 on the 20th – that was a -13.8% swan dive… then it rallied +8.5% straight up and into a CNBC instigated “bad bank bailout” lower high of 874, before being eaten by the shark line (see chart below), where we we’re fortunate to proactively move to 82% cash.
On the week, the SP500 was down -0.7% (our virtual portfolio was -0.4%). It was that 2-day shark bite (Thursday-Friday) that seemed to catch some people off guard.
Our Hedgeye Asset Allocation model ended up down -1.74% for the month (no stocks, just ETFs). While I am sure that wasn’t the worst performance in the league, I am not pleased with it. No excuses – we move forward into February.
Keith R. McCullough
CEO / Chief Investment Officer