From the desk of Willie Delwiche.

My grandfather always wanted to drive the length of the Alaska Highway. 

One summer, when he and my grandmother were approaching 70, Paul & Doris bought a Ford diesel pick-up truck, installed a camper in the bed, and headed West from their suburban Washington, DC home in pursuit of adventure.

They made the journey in one piece. It was, by all accounts, the trip of a lifetime. I have a photo from that trip that I just love. It's the two of them sitting on a log with a lake in the background, surrounded by the Alaskan summer in all its glory. They are vibrant, robust and full of life.

From the desk of Willie Delwiche.

Key Takeaways:

• The market hasn’t had to cope with disappointing news 
• Increased confidence raises the expectations bar
• Rising yields & growth hiccups offer a challenge

The S&P 500 has benefitted from an unprecedented string of good news. The economic surprise index has been positive since June (the longest continuous streak on record) and for most of that time has been accompanied by a rising earnings revision trend. Since 2003, this combination of positive economic surprises and rising earnings revisions have occurred less than 30% of the time. But in that environment, the S&P 500 has risen at a 20% annual rate, versus an overall annualized gain of 8.7% since January 2003.

From the desk of Willie Delwiche.

From the desk of Willie Delwiche.

With both Energy and Communication Services faltering in recent weeks, the sector leadership group has narrowed to Materials, Industrials, and Financials. Materials, which took over the top spot in the rankings this week, is the rare sector right now that has been a leader on both a short-term and long-term basis. Health Care and Real Estate (both of which made new highs last week) are climbing in the rankings and if recent strength persists could soon join the leadership group.  Our industry group heat map shows continued leadership from mid-caps overall.

From the desk of Steve Strazza @Sstrazza

Our Top 10 report was just published. In this weekly note, we highlight 10 of the most important charts or themes we're currently seeing in asset classes around the world.

The Growth Vs Value Cheat Code

We’ve pounded the table about that 1.70 level being the line in the sand for the relative trend in Growth vs Value. If we’re below there - which we believe we’re likely to remain, then we want to continue to be overweight Value and cyclicals. If the ratio decisively reclaims this level then we’ll have to rethink our entire thesis, along with that of a new Commodities Supercycle. But, that’s not the bet we’re making at all.

From the desk of Steve Strazza @Sstrazza and Ian Culley @IanCulley

Check out this week's Momentum Report, our weekly summation of all the major indexes at a Macro, International, Sector, and Industry Group level.

By analyzing the short-term data in these reports, we get a more tactical view of the current state of markets. This information then helps us put near-term developments into the context of the big picture and provides insights regarding the structural trends at play.

Let's jump right into it with some of the major takeaways from this week's report:

* ASC Plus Members can access the Momentum Report by clicking the link at the bottom of this post.

Macro:

From the desk of Willie Delwiche.

From the desk of Willie Delwiche.

I recently came across a conversation about momentum…

I was excited when I first saw it -- but disappointed when it didn't actually go anywhere.

Okay that's a joke. But I did see a momentum discussion. This time, it went somewhere. It even got me thinking about my own experience with momentum when it comes to making investment decisions.

Here's the story: 

Someone on Twitter asked whether momentum investing had a godfather of sorts, an established voice that lends an air of respectability to a discipline. Think about Warren Buffett (and before him, Graham & Dodd) with respect to value investing. There were interesting comments in the thread that followed the initial post and I saw more than a few references to Cliff Asness and the work he has done at AQR. While acknowledging the work he has done with respect to momentum as a strategy, Asness himself referenced several academics who have written on the subject over the past few decades.

This is the video recording of the April 22nd Town Hall Meeting w/ Willie Delwiche

04/22/21 2PM ET

From the desk of Willie Delwiche.

Key Takeaways:

• Adaptive exposure can stay in harmony with market environment  
• Risk tolerances are dynamic, moving with the market
• Indicators & investors operate across multiple timeframes

The word perspective has multiple definitions. The dictionary we have at our house lists eight. For me, the most relevant of those have to do with seeing the interrelationships of relevant facts and ideas as well as  those that deal with distant time frames & horizons.

When it comes to investing, keeping perspective is the difference between success  and failure. A successful approach to portfolio management can be built on a sturdy three-legged stool of perspective focusing on:

From the desk of Willie Delwiche.

From the desk of Willie Delwiche.