The Issachar Fund (LIONX), is about 90% invested in 41 growth stocks as of 5/03/20. The largest LIONX stock theme weighting leans towards the “cloud” (internet) and “work from home” (teleconferencing) areas of the market. These stocks have been the recent leaders and that is why I like to “follow the money” when investing LIONX assets. The “leaders” are stocks that appear to be under accumulation by institutions as measured by above average volumes. When large institutions decide to own a particular segment of the market like the “cloud” space, they will typically buy (accumulate) stocks over time. They normally attempt to “fly under the radar” to not make a “big wave” and bring attention to their purchases. I try to identify these “leaders” and stay in sync with the major trends seeking to ride the “coat-tails” of the “big boys” assuming they know what they are doing. Basically, “big money” makes the trends I like to follow and when I see “distribution” (selling), I try to step aside and wait for the next opportunity. As I see it, the trend is up since the March 23rd bottom and if I sense a trend change, I will adjust my sails accordingly. (There is no guarantee that any investment will achieve its objectives, generate positive returns, or avoid losses.)
The coronavirus induced “fear” changed to the Fear of Missing Out (FOMO)! Last Monday, Tuesday and Wednesday produced a FOMO gain of about 6% in the small caps then it evaporated to a -7% loss by Friday. Some big stock tech names released earnings late last week and the “perception” was not good so “big money” appeared to do a lot of selling. Semiconductor stocks were “hot” into Wednesday then they were scrambling into Friday as their gains quickly evaporated on higher volumes. The good news is I believe the big money is just reshuffling the deck (moving to other areas) and not going to cash at this time. The cloud names appear to be a beneficiary of the move out of small caps, so I plan to sit tight until I see the tide changing.
Oil prices have not recovered and are down over 80% YTD! Oil prices will likely not bottom until the market perceives a pick-up in demand. There are a lot of people that “hate” on oil because it is a “fossil fuel” and supposedly destroying our planet, however, there is limited alternative options for fuel to fly planes, trains, and automobiles. We need oil and we value the many good people that work in the oil industry. I am a little biased because I used to be a diesel mechanic in the oil field until God changed my life. Watch My Story if you are interested.
The Federal Reserve (Fed) owns the largest percent (13%) of our $24.9 TRILLION National Debt! China and Japan each own about 7% of our national debt, however, the Fed’s ownership is increasing rapidly as Congress approves more stimulus spending. I do not believe we can ever pay off this kind of debt that equates to about $800,000 per American. Sooner or later, I believe there will be a price to pay for this unprecedented spending. For now, the market does not seem to care so I plan to just go with the flow until it changes.
Bottom line: The Fed said it will do anything it takes to support a U.S. economy in dire straits, so I am counting on the Fed to have our backs. This rally could have been based on hope and psychology and now the balloon possibly is ready to pop, who knows? Whatever happens, I seek to lock in gains and always attempt to avoid life-changing losses. I believe God is still in control (after slinging planets into orbit) and He will get us through this difficult period just like every other time. I wish you well and God Bless!
Everything is possible for one who believes. Mark 9:23
Investors should carefully consider the investment objectives, risks, charges, and expenses of the Issachar Fund. This and other important information about the Fund are contained in the prospectus, which can be obtained by calling 1-866-787-8355 or visiting https://www.LIONX.net. The prospectus should be read carefully before investing. The Issachar Fund is distributed by Northern Lights Distributors, LLC., member FINRA/SIPC. Horizon Capital Management Inc., (HCM) is not affiliated with Northern Lights Distributors, LLC. Important Risk Information: Mutual Funds involve risks including the possible loss of principal. An investment in the Fund may not be appropriate for all investors. The Fund may hold cash positions when the Adviser feels that the market is not producing returns greater than the short-term cash investments in which the Fund may invest. There is a risk that the sections of the market in which the Fund invests will begin to rise or fall rapidly and the Fund will not be able to sell stocks quickly enough to avoid losses or reinvest its cash positions into areas of the advancing market quickly enough to capture the initial returns of changing market conditions. The Adviser’s judgment about the attractiveness, value, and potential appreciation of particular asset classes and securities in which the Fund invests may prove to be incorrect and may not produce the desired results. Past performance is no guarantee of future results. For more information on LIONX, please visit LIONX.net. NLD Review Code: 3539-NLD-5/4/2020