The Issachar Fund holds a high-yielding short-term fixed-income ETF but is ready to invest in equities! Our macro gold and short positions were not rewarding us, so they were sold. The short-covering rally in the tech-heavy NASDAQ 100 index is now up ten of the last eleven days and due for a pause as it flirts with a line of resistance. The S&P 500 big cap index chart pattern looks similar, so I expect some back and fill before stocks continue this seasonally strong advance into year-end. Investors’ appetite for risk is rising as junk bonds trade above their up-trending 50-day moving average. I remain flexible and opportunistic, listening to the charts and not letting my macro-opinions dictate where we invest. Regardless of the war news and higher rates/inflation, the market wants to head higher. I plan to buy a few stocks in the software and insurance industries if the market continues to reward risk. (There is no guarantee that any investment will achieve its objectives, generate positive returns, or avoid losses.)
Federal Reserve research states that an inverted yield curve doesn’t just predict a recession; it might cause it! That makes sense because when the yield curve is inverted (short rates > long rates), banks are not incentivized to lend longer term. Recession or not, growth stocks do not seem to care. Americans’ credit card debt swelled $154 billion YoY to a record $1.08 trillion in Q3, notching the largest increase since 1999. On Thursday, Powell said he is not confident the central bank has done enough to rein in inflation and bring it back down to its 2% target. He also said there is a long way to go, and inflation remains too high. Bond yields jumped on his comments Thursday, and equities fell. Also, around his comments was a 30-year Treasury auction, which saw its lowest demand in two years. Why is US bond demand in decline, and does that mean rates are headed higher for longer?
Bottom line: Major indexes have rallied 10 of the last 11 days into price resistance, so I expect some profit-taking this week. My “ready list” of stocks to buy is growing, and I expect to dip my toe in the water if the rally remains constructive. Software and insurance stocks seem to be capturing most of the gains, so that is where I plan to go shopping. The Fed continues Quantitative Tightening (QT) by letting another $6 billion of bonds mature off its $7.9 trillion balance sheet last week, and the market rallied. I am encouraged to see stocks breaking out and holding gains, which was not the case a few weeks ago. I remain flexible and opportunistic. Grace and Peace to Everyone!
Since we have been justified by faith, we have peace with God through our Lord Jesus Christ. Romans 5:1
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, obtained by calling 1-866-787-8355 or visiting IssacharFund.com. The Prospectus should be read carefully before investing. The Issachar Fund is distributed by Northern Lights Distributors, LLC., a member of 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 incorrect and may not produce the desired results. Past performance is no guarantee of future results. Ratings are only one form of Fund performance and should not be used as the sole consideration in an investment decision. Opinions expressed are subject to change, not guaranteed, and should not be considered investment advice. There is no assurance these opinions or forecasts will come to pass, and past performance is no assurance of future results. For more information regarding the Fund, including current performance, please visit IssacharFund.com. 3554-NLD-11/13/2023