McCullough: ‘If You Want To Repeat the Same Mistakes, Go Be A Cleveland Browns Fan’

12/15/16 11:23AM EST

https://youtu.be/_boF31t-_MQ

There are a number of good reasons why Hedgeye is the fastest-growing financial services company of its kind. One of them is that since our firm’s inception over eight years ago, we’ve embraced a rigorous, non-consensus approach to analyzing the markets and economy. In other words, we ignore the crowd and march to the beat of our own drummer. Our process, while not perfect, is correct far more than not.

Take bonds for example. As many people know, we were the bond bulls (since August 2014). The call worked out very well for us and our subscribers. But then the data changed. And so we changed (thankfully well before 10-year Treasury yields hit today’s 2.60%).

“We do not wake up every day making the same mistakes over and over and over again,” says Hedgeye CEO Keith McCullough. “If you want to do that, you can go be a Cleveland Browns fan.” McCullough continues.

“It’s been a great year from a personal return perspective, even though I had a very bad air pocket after the Election, but a great year. An even greater year for the firm. I’d put what we do here up against anyone in financial services this year.”

Some quick history.

In July of 2008, we said move 85% of your portfolio to cash. We said buy equities in March 2009. And again in January 2013. This is our process. We measure and map the economic cycle. When the data changes, we change.

That’s why when U.S. economic data, from Retail Sales to Industrial Production, turned the corner following Donald Trump’s presidential victory, we made the pivot and advised subscribers to sell bonds and buy U.S. equities (see our virtual asset allocation below).

It was a 180 degree change for us, from U.S. #GrowthSlowing to #GrowthAccelerating. But it was justified by the economic data. It also happened to be a good call. Here’s financial market performance since Election Day:

  • S&P 500: +5.7%
  • Russell 2000: +13.7%
  • 10-year Treasury yield: went from 1.857% to 2.60% today

The fact is, McCullough says, “We will not grow unless we are truthful and objective about the process that we have built. We also are communicating and hopefully commercializing this for all of you so that you can use it to augment what it is that you do.”

Don’t take our word for it. We invite you to take a closer look.

McCullough: ‘If You Want To Repeat the Same Mistakes, Go Be A Cleveland Browns Fan’ - asset alloc 12 15

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