CLIENT TALKING POINTS
China
Is on the precipice of slowing again and their central market planners are actually being forced to drain a ton of liquidity (PBOC market operations = -595B in JAN alone) to defend the Yuan at this 7.0 level vs. USD – we’ll review this developing #StrongDollar Chinese risk on tomorrow’s Q1 2017 Macro Themes Call.
Oil
Provided yet another buying opportunity at the low-end of my risk range yesterday (in US Equity terms, the high beta way to express that = XOP); WTI +0.6% this morning with immediate-term upside to the top end of the range up at $54.80/barrel with OVX downside to 28-29.
Nasdaq
Registered another all-time closing high yesterday as the performance chase in big FANG names that had underperformed post the Trump Win = obvious… from an implied volatility perspective, the more contrarian buy on pullbacks from here is SPY, not QQQ (30-day SPY implied vol premium = +16% vs. Nasdaq down to +9%).
Asset Allocation
| CASH | US EQUITIES | INTL EQUITIES | COMMODITIES | FIXED INCOME | INTL CURRENCIES | |
|---|---|---|---|---|---|---|
| 1/9/17 | 39% | 15% | 9% | 10% | 0% | 27% |
| 1/10/17 | 34% | 18% | 10% | 11% | 0% | 27% |
Asset Allocation as a % of Max Preferred Exposure
| CASH | US EQUITIES | INTL EQUITIES | COMMODITIES | FIXED INCOME | INTL CURRENCIES | |
|---|---|---|---|---|---|---|
| 1/9/17 | 39% | 45% | 27% | 30% | 0% | 82% |
| 1/10/17 | 34% | 55% | 30% | 33% | 0% | 82% |
THREE FOR THE ROAD
TWEET OF THE DAY
RUSSIA: stocks up another +0.6% (+58.5% in the last yr) and we remain bullish on them
@KeithMcCullough
QUOTE OF THE DAY
“And maybe I'm a little smarter now than I was before for all the stupid things I've done.”
–Herb Brooks
STAT OF THE DAY
Clemson has won 2 national championships in football (1981, 2016).