CHART OF THE DAY: Pie Chart Diversification Models Don't Work In Deep #Quad4

05/18/20 07:46AM EDT

Below is a chart and brief excerpt from today's Early Look written by Hedgeye CEO Keith McCullough. 

For non-FOMO observations, I usually start with a review of the Global Currency market:

  1. US Dollar (up another +0.7% last week) Index continues to signal a Global #Quad4 Depression/Recession
  2. EUR/USD continued lower, down another -0.2% last week and remains Bearish TREND @Hedgeye 

As a reminder, through the lens of economic gravity (i.e. The Quads), the only time the US Dollar is strong and strengthening like this is when both the Global and US economies are seeing growth and inflation slow at the same time.

The less diversified the equity component of your portfolio, the better right now. Tech is Bullish @Hedgeye TREND but don’t forget that only 2 stocks (AAPL and MSFT) make up 42% of the Tech (XLK) ETF!

Looking inside the Factor Exposures of the US stock market (SP500 btw was down for the 7th week in the last 11 which is the oddest “V-Shaped” looking thing to me)

CHART OF THE DAY: Pie Chart Diversification Models Don't Work In Deep #Quad4 - Pie Chart Diversification Models Don t Work In Deep Quad 4

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