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ICI Fund Flow Survey | International Equity Funds Batting 1.000 in 2015

Takeaway: Investors continue to favor international equity funds, which took in +$3.8 billion last week maintaining a perfect inflow streak for 2015.

This note was originally published August 06, 2015. Click here for more information on how you can begin your Hedgeye subscription today.

Investment Company Institute Mutual Fund Data and ETF Money Flow:

In the 5-day period ending July 29th, investors made net withdrawals from most asset classes but continued to allocate to international equity funds with a +$3.8 billion contribution. Investors have made positive subscriptions to international stock funds every week so far in 2015 aggregating to +$88.5 billion year-to-date. The source of funds continues to be domestic equities, with redemptions in 24 of 30 weeks so far in 2015. Year-to-date withdrawals in domestic stock funds now total -$83.5 billion, the worst 30 week start to any year this cycle. Additionally, investors have been backing off fixed income recently with fund flows to total fixed income mutual funds and ETFs having been negative in 6 out of the past 8 weeks.


ICI Fund Flow Survey | International Equity Funds Batting 1.000 in 2015 - z cast fund flows 1

 

In the most recent 5-day period ending July 29th, total equity mutual funds put up net outflows of -$1.4 billion, trailing the year-to-date weekly average inflow of +$166 million and the 2014 average inflow of +$620 million. The outflow was composed of international stock fund contributions of +$3.8 billion and domestic stock fund withdrawals of -$5.2 billion. International equity funds have had positive flows in 48 of the last 52 weeks while domestic equity funds have had only 10 weeks of positive flows over the same time period.

 

Fixed income mutual funds put up net outflows of -$4.7 billion, trailing the year-to-date weekly average inflow of +$1.7 billion and the 2014 average inflow of +$929 million. The outflow was composed of tax-free or municipal bond funds withdrawals of -$88 million and taxable bond funds withdrawals of -$4.6 billion.

 

Equity ETFs had net redemptions of -$1.9 billion, trailing the year-to-date weekly average inflow of +$2.3 billion and the 2014 average inflow of +$3.2 billion. Fixed income ETFs had net inflows of +$384 million, trailing the year-to-date weekly average inflow of +$916 million and the 2014 average inflow of +$1.0 billion.

 

Mutual fund flow data is collected weekly from the Investment Company Institute (ICI) and represents a survey of 95% of the investment management industry's mutual fund assets. Mutual fund data largely reflects the actions of retail investors. Exchange traded fund (ETF) information is extracted from Bloomberg and is matched to the same weekly reporting schedule as the ICI mutual fund data. According to industry leader Blackrock (BLK), U.S. ETF participation is 60% institutional investors and 40% retail investors.   

 

Most Recent 12 Week Flow in Millions by Mutual Fund Product: Chart data is the most recent 12 weeks from the ICI mutual fund survey and includes the weekly average for 2014 and the weekly year-to-date average for 2015:

 

ICI Fund Flow Survey | International Equity Funds Batting 1.000 in 2015 - ICI2

 

ICI Fund Flow Survey | International Equity Funds Batting 1.000 in 2015 - ICI3

 

ICI Fund Flow Survey | International Equity Funds Batting 1.000 in 2015 - ICI4

 

ICI Fund Flow Survey | International Equity Funds Batting 1.000 in 2015 - ICI5

 

ICI Fund Flow Survey | International Equity Funds Batting 1.000 in 2015 - ICI6

 

 

Cumulative Annual Flow in Millions by Mutual Fund Product: Chart data is the cumulative fund flow from the ICI mutual fund survey for each year starting with 2008.

 

ICI Fund Flow Survey | International Equity Funds Batting 1.000 in 2015 - ICI12

 

ICI Fund Flow Survey | International Equity Funds Batting 1.000 in 2015 - ICI13

 

ICI Fund Flow Survey | International Equity Funds Batting 1.000 in 2015 - ICI14

 

ICI Fund Flow Survey | International Equity Funds Batting 1.000 in 2015 - ICI15

 

ICI Fund Flow Survey | International Equity Funds Batting 1.000 in 2015 - ICI16

 

 

Most Recent 12 Week Flow within Equity and Fixed Income Exchange Traded Funds: Chart data is the most recent 12 weeks from Bloomberg's ETF database (matched to the Wednesday to Wednesday reporting format of the ICI), the weekly average for 2014, and the weekly year-to-date average for 2015. In the third table are the results of the weekly flows into and out of the major market and sector SPDRs:

 

ICI Fund Flow Survey | International Equity Funds Batting 1.000 in 2015 - ICI7

 

ICI Fund Flow Survey | International Equity Funds Batting 1.000 in 2015 - ICI8

 

 

Sector and Asset Class Weekly ETF and Year-to-Date Results: In sector SPDR callouts, the materials XLB ETF saw the highest percentage net withdrawal last week of -3% or -$65 million.

 

ICI Fund Flow Survey | International Equity Funds Batting 1.000 in 2015 - ICI9

 

 

Cumulative Annual Flow in Millions within Equity and Fixed Income Exchange Traded Funds: Chart data is the cumulative fund flow from Bloomberg's ETF database for each year starting with 2013.

 

ICI Fund Flow Survey | International Equity Funds Batting 1.000 in 2015 - ICI17

 

ICI Fund Flow Survey | International Equity Funds Batting 1.000 in 2015 - ICI18

 

 

Net Results:

The net of total equity mutual fund and ETF flows against total bond mutual fund and ETF flows totaled a positive +$998 million spread for the week (-$3.3 billion of total equity outflow net of the -$4.3 billion outflow from fixed income; positive numbers imply greater money flow to stocks; negative numbers imply greater money flow to bonds). The 52-week moving average is +$1.7 billion (more positive money flow to equities) with a 52-week high of +$27.9 billion (more positive money flow to equities) and a 52-week low of -$18.1 billion (negative numbers imply more positive money flow to bonds for the week.)

  

ICI Fund Flow Survey | International Equity Funds Batting 1.000 in 2015 - ICI10

 

Exposures: The weekly data herein is important for the public asset managers with trends in mutual funds and ETFs impacting the companies with the following estimated revenue impact:

 

ICI Fund Flow Survey | International Equity Funds Batting 1.000 in 2015 - ICI11 

 

 

Jonathan Casteleyn, CFA, CMT 

203-562-6500 

jcasteleyn@hedgeye.com 

 

Joshua Steiner, CFA

203-562-6500

jsteiner@hedgeye.com

 

 

 

 

 


LWAY | Sitting on a Gold Mine with no Tools

Lifeway Foods (LWAY) is on the Hedgeye Consumer Staples LONG bench.

 

LWAY has been on our “to do” list for some time.  We have had it on our LONG bench. Following WWAV’s acquisition of the Wallaby Yogurt Company, which sells Kefir beverages there might be some increased interest in LWAY. 

 

The probiotic segment is at the early stages of growth and looks to be the next major growth category within the $275 billion “fortified/functional foods” segment (according to Euromonitor.)  In a recent survey by NPD Group, 31% of Americans said they wanted to ingest more probiotics.  Therefore, it’s not surprising to know that three companies (Nestle, General Mills and Danone) are aware of this opportunity and spending significant R&D dollars aimed at this segment. Danone is the world’s largest yogurt producer and none of its products sells better than Activia, the probiotic-enhanced yogurt launched in 1987.  In 2014, sales of Activia were $2.4 billion.    

 

Lifeway, a market leader in the Kefir segment, is dealing with an onslaught of competition from smaller players within the natural channel. Brands such as Siggi’s, Wallaby, Goodbelly, and a few other regional brands. The fact is, competition comes where there is a good idea and prospect for growth. Lifeway and their competition are early in the growing market of probiotics, but the race is on to see who will dominate the category.

 

It does not take long to realize that Lifeway’s current management team does not have the skill set capable of keeping them in the leadership position.  Significant changes are needed to take full advantage of the market opportunity.     

 

The LONG thesis on LWAY is predicated on the company being acquired, given the families control, it is unlikely they would give up control to an externally hired CEO. Current founders, the Smolyansky family, own 49.7% of the company, with co-founder Ludmila (mother) owning 44.7% of that, working in an advisory role. Daughter, Julie is the President, CEO & Director and the son, Edward, is the COO, CFO, Secretary, Treasurer & CAO. They are clearly in way over their head, and will have trouble taking this company to the next level on their own. Their father (deceased in 2002) has led them to a gold mine, but they don’t have any tools to get the gold.

 

The x-factor is that Danone owns 21.1% of the company currently (acquired the stake in 1999), and although they shrugged off the idea of acquiring this business in the past, they have to be thinking about it more seriously now. When thinking about other possible acquirers, General Mills (GIS) comes to mind, given their strong presence across the yogurt category, they don’t yet have a Kefir product. They could make one themselves utilizing the Liberte or the Yoplait brand, but Lifeway would afford them immediate expertise and distribution.

 

LWAY hasn’t reported numbers for 1Q15 or 2Q15 and are still working through it with the SEC. We have received word from their IR representative that this issue is as close as a month from being resolved and they will soon be in compliance with the SEC. Although we have no picture on how the business is doing over roughly the last 6 months, we are confident in the growth trajectory in the category they participate in as a leader.

 

We would tread with caution on this one. Although this is the top brand in the category, it is not possible for us to endorse the management team as it stands today.  The market place is getting more competitive so we are waiting and watching to see how things unfold.  Additionally, LWAY needs to be in compliance with its filings and we need to get a better handle on the numbers before going all in on this one.

 

 

 

 


MONDAY MORNING RISK MONITOR | JUNK BOND CRATERING CONTINUES

Takeaway: Junk bonds yields continue to blow out while commodity prices plumb fresh lows. Meanwhile, China catches a breather.

Key Takeaway:

The US high yield and leveraged loan markets continue to back up. High yield rose another 12 bps on the week (+38 bps M/M), hitting 7.06%). Rates are backing up on both credit and rate fears. Credit fears are flowing largely from the energy borrowers, who are now on the wrong end of 12+ months of crude and nat gas's price slide. Rate fears reflect the asymmetry of the Fed's current position.

 

We've been watching China closely as a global catalyst and causal determinant of commodity prices. Interestingly, the two diverged this week. China got a little less bad on the margin (Chinese Steel prices +4.9% W/W & +11.3% M/M), while commodity prices generally (CRB) pushed to new lows (-3.5% W/W and -9.1% M/M).

 

Current Ideas:

 

MONDAY MORNING RISK MONITOR | JUNK BOND CRATERING CONTINUES - RM19

 

Financial Risk Monitor Summary

 • Short-term(WoW): Negative / 2 of 12 improved / 2 out of 12 worsened / 8 of 12 unchanged

 • Intermediate-term(WoW): Positive / 6 of 12 improved / 4 out of 12 worsened / 2 of 12 unchanged

 • Long-term(WoW): Positive / 3 of 12 improved / 1 out of 12 worsened / 8 of 12 unchanged

 

MONDAY MORNING RISK MONITOR | JUNK BOND CRATERING CONTINUES - RM15

 

1. U.S. Financial CDS -  Swaps widened for 17 out of 27 domestic financial institutions. Genworth Financial reported disappointing earnings, especially in its mortgage services and U.S. life divisions, last Tuesday. Following that, CDS on the company's debt widened by +152 bps to 459.

 

Tightened the most WoW: CB, ACE, AXP

Widened the most WoW: GNW, ALL, MET

Tightened the most WoW: ACE, CB, AXP

Widened the most MoM: GNW, MMC, MBI

 

MONDAY MORNING RISK MONITOR | JUNK BOND CRATERING CONTINUES - RM1

 

2. European Financial CDS - As is often the case, Greek banks tend to sway the mean for the EU banking complex. The median is, therefore, the better measure. The median change in swaps was +2 bps on the week. Greece's equity market reopened last Monday and subsequently tumbled. Not surprisingly, the country's banks swaps followed suit, widening by +16 to +3,338 bps W/W.

 

MONDAY MORNING RISK MONITOR | JUNK BOND CRATERING CONTINUES - RM2

 

3. Asian Financial CDS were mixed last week. Indian bank swaps rose +3 to +10 bps, while banks in Japan and China were little changed.

 

MONDAY MORNING RISK MONITOR | JUNK BOND CRATERING CONTINUES - RM17

 

4. Sovereign CDS – DM sovereign swaps were little changed last week. 

 

MONDAY MORNING RISK MONITOR | JUNK BOND CRATERING CONTINUES - RM18

 

MONDAY MORNING RISK MONITOR | JUNK BOND CRATERING CONTINUES - RM3

 

MONDAY MORNING RISK MONITOR | JUNK BOND CRATERING CONTINUES - RM4

 

5. Emerging Market Sovereign CDS – Unlike DM, EM swaps widened notably last week with petro-states Brazil and Russia seeing the most widening, by +33 bps to 326 and +22 bps to 360 respectively.

 

MONDAY MORNING RISK MONITOR | JUNK BOND CRATERING CONTINUES - RM16

 

MONDAY MORNING RISK MONITOR | JUNK BOND CRATERING CONTINUES - RM20

 

6. High Yield (YTM) Monitor – High Yield rates rose 12 bps last week, ending the week at 7.06% versus 6.94% the prior week.

 

MONDAY MORNING RISK MONITOR | JUNK BOND CRATERING CONTINUES - RM5

 

7. Leveraged Loan Index Monitor – The Leveraged Loan Index fell 6.0 points last week, ending at 1876.

 

MONDAY MORNING RISK MONITOR | JUNK BOND CRATERING CONTINUES - RM6

 

8. TED Spread Monitor – The TED spread was unchanged last week at 25 bps.

 

MONDAY MORNING RISK MONITOR | JUNK BOND CRATERING CONTINUES - RM7

 

9. CRB Commodity Price Index – The CRB index fell -3.5%, ending the week at 198 versus 205 the prior week. As compared with the prior month, commodity prices have decreased -9.1%. We generally regard changes in commodity prices on the margin as having meaningful consumption implications.

 

MONDAY MORNING RISK MONITOR | JUNK BOND CRATERING CONTINUES - RM8

 

10. Euribor-OIS Spread – The Euribor-OIS spread (the difference between the euro interbank lending rate and overnight indexed swaps) measures bank counterparty risk in the Eurozone. The OIS is analogous to the effective Fed Funds rate in the United States.  Banks lending at the OIS do not swap principal, so counterparty risk in the OIS is minimal.  By contrast, the Euribor rate is the rate offered for unsecured interbank lending.  Thus, the spread between the two isolates counterparty risk. The Euribor-OIS spread was unchanged at 10 bps.

 

MONDAY MORNING RISK MONITOR | JUNK BOND CRATERING CONTINUES - RM9

 

11. Chinese Interbank Rate (Shifon Index) –  The Shifon Index rose 6 basis points last week, ending the week at 1.53% versus last week’s print of 1.47%. The Shifon Index measures banks’ overnight lending rates to one another, a gauge of systemic stress in the Chinese banking system.

 

MONDAY MORNING RISK MONITOR | JUNK BOND CRATERING CONTINUES - RM10

 

12. Chinese Steel – Steel prices in China rose 4.9% last week, or 110 yuan/ton, to

2349 yuan/ton. We use Chinese steel rebar prices to gauge Chinese construction activity and, by extension, the health of the Chinese economy.

 

MONDAY MORNING RISK MONITOR | JUNK BOND CRATERING CONTINUES - RM12

 

13. 2-10 Spread – Last week the 2-10 spread tightened to 144 bps, -7 bps tighter than a week ago. We track the 2-10 spread as an indicator of bank margin pressure.

 

MONDAY MORNING RISK MONITOR | JUNK BOND CRATERING CONTINUES - RM13

 

14. XLF Macro Quantitative Setup – Our Macro team’s quantitative setup in the XLF shows 0.7% upside to TRADE resistance and 0.8% downside to TRADE support.

 

MONDAY MORNING RISK MONITOR | JUNK BOND CRATERING CONTINUES - RM14

 

Joshua Steiner, CFA

 

Jonathan Casteleyn, CFA, CMT

 


Early Look

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Relied upon by big institutional and individual investors across the world, this granular morning newsletter distills the latest and most vital market developments and insures that you are always in the know.

Monday Mashup

Monday Mashup - CHART 1

 

RECENT NOTES

8/10/15 WWAV | KEEP RIDING THIS WAVE

8/6/15 WWAV | EARNINGS PREVIEW & POTENTIAL ACQUISITION

8/05/15 K | IS CEREAL RESUSCITATING THE COMPANY?

8/4/15 BETR | It’s Already Popped

7/30/15 GIS TO BUY WWAV | IN SEARCH FOR TRANSFORMATIONAL GROWTH

 

RECENT NEWS FLOW

Friday, August 7

WWAV | Reported 2Q15 results, which were highlighted by robust organic top line growth of +9%, but missed on the top line slightly. In addition to the impressive quarter, WWAV also acquired the Wallaby Yogurt Company (view our note here)

POST | Reported 3Q15 results in which management mitigated all of the potential disaster Avian Flu could have brought on them, and surprised the street. Most importantly they had great things to say about cereal. Declines in RTE cereal are slowing, and they are beginning to see an upward trend. Management noted that their biggest over performance versus expectation was in the RTE cereal category. As the industry is cycling over easier comps, “leaders in the category [GIS & K] seem to be reinvigorating their spending behind the category and it seems to be working.” (click here for news release)

 

Wednesday, August 5

BETR | Tumbled in its opening day of trading, down roughly -7%, never trading above their IPO price of $18 per share (click here for article, or here for our note on the IPO)

K | Upgraded to buy from neutral at Citi, target increased to $80 from $66

 

Tuesday, August 4

HSY | Introduces latest BFY granola bar offering (click here for article)

 

SECTOR PERFORMANCE

Food and organic stocks that we follow outperformed the XLP last week. The XLP was down -0.3%, the top performer from our list was Boulder Brands (BDBD) posting an increase of 11.3%, after announcing the engagement of William Blair to explore strategic alternatives for some of their brands. Worst performing company on our list was Amira Natural Foods (ANFI), which was down 21.7%.

Monday Mashup - CHART 2

 

QUANTITATIVE SETUP

From a quantitative perspective, the XLP remains bullish on a TRADE and TREND duration.

Monday Mashup - CHART 3

 

Food and Organic Companies

Monday Mashup - CHART 4

Monday Mashup - CHART 5

 


WWAV | KEEP RIDING THIS WAVE

WhiteWave Foods (WWAV) is on the Hedgeye Consumer Staples Best Ideas list as a LONG.

 

HEDGEYE OPINION

WWAV continues to impress us with their robust high-single digit to low-double digit organic growth rate. This quarter, in addition to their robust organic growth, WWAV also acquired the Wallaby Yogurt Company, an organic Greek and Australian style yogurt and Kefir beverage company. This is a continuation of their string of pearls approach, to adding top brands to their portfolio. WWAV continues to be a top company on our list for their future growth prospects both organic and through M&A as well as their possibility of being acquired. The stock traded a little weak through the day after earnings, but this company is still in BEAST MODE, no need to think anything different.

 

PERFORMANCE

On Friday August 7th, WWAV reported a strong 2Q15, featuring robust organic growth, as well as a new acquisition. Reported revenue rose 10% to $924mm, slightly below consensus estimates of $927.2mm, organic revenue grew to $911mm, up 9% YoY. Operating income beat estimates, reporting $84.9mm versus consensus estimates of $83.1mm, representing a 20% increase YoY. WWAV beat the street estimates on the bottom line by a penny, reporting adjusted EPS, excluding the China JV of $0.26 versus consensus estimates of $0.25, representing an 11% increase YoY.

 

This robust growth was slightly hampered by a slowdown in the America’s Fresh Foods segment. The segment experienced tough crop conditions in the quarter in which they weren’t able to harvest a large amount of their fruit supply. All said and done, the segment sales were down -1%, but operating income was up 11%, as they continue to streamline the manufacturing process and exit lower margin business. Since the supply issues on organic salad last quarter, the team has worked diligently on regaining distribution and are seeing strong results.

 

Horizon Organic sales were up 15% in the quarter driven entirely by price, as organic milk supply continues to be constrained; consumers don’t seem to care about the rising prices. Horizon center-of-store products are meeting the increased expectations set out in the last call, and are well positioned heading into the back to school season.  

 

The European Foods and Beverages segment is growing at an unbelievable 23% on a constant currency basis. This growth is purely volume driven across all markets and product lines. This is the 4th consecutive quarter of 20%+ growth for this business and they are still expanding into new countries. Just recently entering France, and although in its early stages results are positive. Alpro is also working on new products such as drinkable yogurts that are coming out towards the end of the year.

 

Management is pushing costs out of the business. In the quarter they delivered 75bps of margin expansion, and are expecting to deliver that or more on a full year basis. Increased volume going through the system has been a key driver of cost savings as they further leverage their assets. In addition, the company is looking to invest in expansion, building out packing and manufacturing lines, warehouse space and further automating operations to increase efficiency.

 

 

ACQUISITIONS

In the quarter WWAV completed the acquisition of Vega, for $550mm. The brand has $100mm in sales over the LTM ended June 2015, experiencing 60% constant currency sales growth year-to-date June 2015. Management and Hedgeye are very excited about WWAV adding this brand to the portfolio. Management spoke to its vast expansion capabilities across the U.S. as well as international growth possibilities, such as tacking it onto the Alpro distribution network in Europe. Most importantly this is a margin enhancing, accretive acquisition to WWAV.

 

In addition to the completion of the Vega deal management also entered into an agreement to acquire Wallaby Yogurt Company for $125mm. An organic Greek and Australian style yogurt & Kefir beverage Company. Along with the great brand and growth prospects, as part of the deal WWAV also receives their yogurt manufacturing facility in the on the west coast. Now with their prior facility in Pennsylvania and the newly acquired one in California, they will be able to expand distribution rapidly.  Please view the below case study for greater detail:

WWAV | KEEP RIDING THIS WAVE - CHART 1

WWAV | KEEP RIDING THIS WAVE - CHART 3

 

MANAGEMENT GUIDANCE

After increasing full year guidance coming out of 1Q15 earnings, management is increasing guidance again. They now project reported net sales growth to be +12% - 13% versus prior projections of + low double %, and an organic growth rate of +10%.  Increasing adjusted EPS excluding China JV to $1.14-$1.17 from $1.10-$1.14.

WWAV | KEEP RIDING THIS WAVE - CHART 3 b

 

 


Russell 2000, Japan and UST 2YR

Client Talking Points

RUSSELL 2000

The Russell 2000 got crushed into week’s end, taking it's correction  to -6.9% from its year-to-date high (much worse than SPX -2.5% from its year-to-date high). Small cap and high beta Style Factors are -7.7% and -9.3%, respectively, in the last 3 months – not bullish growth signals.

JAPAN

Japan is up +0.4% overnight and up for the 4th consecutive day –signaling almost as overbought now as the Russell 2000 is oversold, but this continues to be or favorite Global Equity market at +7.4% in the last 3 months vs. the mess that is the aforementioned factors in the U.S.

UST 2YR

The UST 2YR Yield is up at 0.74% this morning and this has been the alleged “breakout” level all year long (failed here every time); if the Fed breaks it out, they could easily be the catalyst for a flattening and/or recession – that’s what Mr. Market told you post jobs report.

Asset Allocation

CASH 60% US EQUITIES 6%
INTL EQUITIES 6% COMMODITIES 0%
FIXED INCOME 22% INTL CURRENCIES 6%

Top Long Ideas

Company Ticker Sector Duration
HOLX

HCA had some potentially chilling commentary on their earnings call this week and introduced a new term, #ACATaper. The pace of growth in the U.S. Medical Economy has been on a tear as the newly insured rolled into physician offices and hospitals. We’ve been highlighting in recent weeks the transition from an #ACATailwind to #ACAHeadwind, or as someone on the HCA call named it, the #ACATaper.   

 

In an analysis of the demographics of the newly insured, Pap testing, HPV, and mammography were at the top of the list of products that would be positively impacted by the ACA.  As we reach the #ACATaper stage, will HOLX take a hit to their Diagnostic segment? It is possible, in our view, but so far a minor risk.  As we learned last week from a lab operator, Qiagen is likely to continue to cede their 14% HPV testing share to HOLX. So while the #ACATaper appears to be finally here, there are offsets. 

 

On a disappointing note, our 3D Tomo Tracker update for July came in at 24 facilities. Down sequentially from June, and down from a peak of 54 in May. Our forecast algorithm, which is based on these updates, remains unchanged. While 20 is low, it is probably a blip in the longer term adoption cycle.  

PENN

PENN has emerged as the first domestic gaming growth story in 10 years with a new casino in Massachusetts this year and one in San Diego next year. Meanwhile, regional gaming trends have stabilized, providing near term earnings visibility and upside. Upcoming catalysts include the monthly release of State gaming revenues for July, including Massachusetts, and positive earnings revisions.

TLT

Sometimes the macro rotation and allocation playbook is relatively straightforward. As growth slows and "reflation" deflates, you want to be buying A) Long-term Bonds and B) stocks that look like bonds. Bond proxies and defensive yield consistently outperform alongside the dual deceleration in demand and prices and Utilities and REITS remain the go-to sectors for growth slowing, defensive yield exposure.  

Three for the Road

TWEET OF THE DAY

VIDEO | History: Why People Are Angry  https://app.hedgeye.com/insights/45717-video-history-why-people-are-angry

@KeithMcCullough

QUOTE OF THE DAY

The time to repair the roof is when the sun is shining.

John F. Kennedy

STAT OF THE DAY

SeaWorld experienced an 84% drop in profits in the second quarter compared to the year before (still reeling from “Blackfish,” the documentary that raised questions about its treatment of animals) attendance dropped by 100,000 people, about 1.5%.


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