Client Talking Points

USD

Another great week for the US Dollar ahead of what should be a hot Q2 US GDP report (Friday); US Dollar Index +0.9% week-over-week and +4.0% month-over-month, taking out hopes for a “weak dollar tailwind” for earnings…

Oil

Continues to break-down this morning with WTI -0.6% at $43.91 with an immediate-term TRADE risk range of 43.09-45.61; WTI was -5.3% week-over-week and has deflated -11.8% during the USD’s +4% one-month ramp.

SPY

Sell low, cover high, baby! SP500 (index + E-mini) net LONG position ramped another +94,526 contracts last week to +154,009 futures & options contracts; to put that in context, that’s a +2.37x move on a 1-yr z-score (at the lows in FEB, it was a net SHORT position of -280,000 contracts).

Asset Allocation

CASH US EQUITIES INTL EQUITIES COMMODITIES FIXED INCOME INTL CURRENCIES
7/24/16 60% 0% 3% 14% 17% 6%
7/25/16 67% 0% 3% 10% 12% 8%

Asset Allocation as a % of Max Preferred Exposure

CASH US EQUITIES INTL EQUITIES COMMODITIES FIXED INCOME INTL CURRENCIES
7/24/16 60% 0% 9% 42% 52% 18%
7/25/16 67% 0% 9% 30% 36% 24%
The maximum preferred exposure for cash is 100%. The maximum preferred exposure for each of the other assets classes is 33%.

Top Long Ideas

Company Ticker Sector Duration
GLD

Gold (GLD) = Protection from global currency devaluation and inflation/down USD – You can travel anywhere on earth and get a quote in local currency.

TLT

Long Bonds (TLT) = #GrowthSlowing, yield curve compression.

TIP

Treasury Inflation-Protected Securities (TIP) = Combination of the above exposures.

Three for the Road

TWEET OF THE DAY

Hedgeye @Hedgeye

[NEW] Why I Remain An Unrepentant Bear app.hedgeye.com/insights/52552… via Mike O'Rourke $SPY #markets #economy pic.twitter.com/95Be5lUEj3

@Hedgeye

QUOTE OF THE DAY

“Knowing others is wisdom, knowing yourself is enlightenment.”

–Lao Tzu

STAT OF THE DAY

David Justice had 305 career homeruns.