September 12:

There are market headwinds building such as slowing economic growth and earnings, Fed tapering, Delta variant wild card effects on jobs and the labor market, and school policy adjustments affecting working parents that suggest a re-assessment of future earning flows.

A downward revision in future earnings over the next two years will lead a frothy market to reset to a lower level. Typically, such resets are overdone in the short-run and lead to market buying opportunities. Prior to a sell-off, it is best to re-allocate one’s portfolio more toward cash or risk-adjusted stocks and funds. Since I live on dividends, my preference is to increase weight on risk-adjusted funds such as ETJ and NUSI. Both funds pay good dividends and have downside protection. Before adjusting your portfolios, check the “Fear-and-Greed Index”, which you can Google. Only when it is positive or in the “Greed” range should you buy into the risk-adjusted funds as they will then be at cheaper valuations. Currently, the index is solidly in the Fear range so I would wait.

Also, the crypto momentum trades have been negative for over a weak now and I got out about 2 weeks back as a result of the change. Don’t go back in until another bottom and the trend is clearly headed back up.

I’ll recommend either increasing your cash positions or waiting to re-allocate into ETJ and NUSI at this point in time. Good investing . . . but watch out below!