The Issachar Fund (LIONX) is 75% Long in Equities and 25% in Cash as of Friday, August 24, 2018. LIONX holds ETFs in Health Care (45%) and Various (23) Stocks (30%). I covered the Short (hedge) position and purchased several more individual stocks as my bullish conviction level continues to increase. If things do not go as planned, I will not hesitate to hedge or sell positions to levels of risk I am comfortable with.
Stocks were purchased based on the CANSLIM system created by Investor’s Business Daily (IBD) founder Willian J. O’Neil. CANSLIM is a powerful system for buying and selling stocks but it requires hard work discipline to be successful. I have been following O’Neil for decades and I believe that he is one of the best stock pickers in the business. There are no systems, models or strategies that work all the time, so one must stay alert for when it is time to make a change. I designed LIONX with the flexibility to adapt to what whatever methodology seems to be working in the current market environment. There are times when LIONX is fully invested and leveraged in Junk Bonds and there are times when we are 100% in Cash. Regardless of where we are, I remain focused on the daily LIONX percent gain/loss in its Net Asset Value (NAV). If the daily NAV gain/loss in LIONX does not line up with the risk (loss) I am assuming, then I take appropriate action seeking to minimize losses and maximize gains. All my investable assets are in LIONX, so I am doing all I can to make LIONX a long-term success.
This Bull Market is the longest in history and appears to be going strong at 3,455 days and there seems to be no end in sight. We all know that one day this Bull will run out of steam and Poppa Bear will come out of hibernation. Currently, I see no indication that this Bull is slowing down. However, no one rings a bell when the party is over. Bear Markets are sneaky, and they are known for creating life-changing losses so stay alert because no one cares more about your money than you do.
The Russell 2000 Index (small-caps) has already broken through its peak resistance and still going strong. The S&P 500 Index is right at its all-time high and it looks like it might break resistance shortly. CANSLIM stocks continued to break out of Basing patterns on strong volume. Many stocks appear extended but many more seem to be setting up nicely to potentially become market leaders. The Advance-Decline line continued to confirm the up-trend. Junk Bonds were consistently trending higher above their 50-day moving average indicating that investors are comfortable with the level of risk in the market. All of this indicates to me that there may be gas left in the tank to take the market higher. However, I will let the charts tell me what I need to do to meet the objective of LIONX shareholders.
The dollar trended higher, but it has now reversed course and is currently trending lower as the Fed eased fears of a rate hike from September to December. The dollar formed a peak on 8/15/18 and Gold formed a bottom on 8/16/18 and I do not believe this is a coincidence. I am expecting more sector rotation as investors get in sync with the effects of a not so strong dollar.
Bottom Line: The Bull continued to charge ahead, and the Bear remained in a deep sleep! It is simply amazing what tax cuts and deregulation can do to an economy and stock market. Capitalism works and I remained very optimistic!
Remember: Your Best-Interest is Also My Best-Interest!
(Portfolio holdings are subject to change at any time and should not be considered investment advice. There is no guarantee that any investment will achieve its objectives, generate positive returns or avoid losses.)