by Chris Kimble of Kimble Charting Solutions
Cross post from advisorperspectives.com/dshort
The price action of high yield funds can be great tools for helping investors and financial professionals in building portfolios, a topic I previously discussed on September 20th. The first chart below illustrates that, over the past decade plus, high yield funds have given quality leading-edge signals of when to overweight stocks and when to underweight them.
The high yield funds gave a “Sell Signal” a few months ago, suggesting two things: (1) sell the high yield funds (2) lower equity exposure. The question now is whether high yields are sending a new buy signal. Actually the high yields are sending a message that risk to the economy and the stock market remains above normal, as the high yield funds are now breaking below their early August lows.
If history is any guide, this breakdown in the high yield funds is sending a message of concern for the economy and equities.
Weak Defense by Chris Kimble
Investing When Others Panic by Elliott Morss
Markets will Rally to Year End by Ben Warwick
How to Catch a Top by David Grandey
Copper: Possible Deflation Call and Warning for Stocks by Albertarocks
Killer Wave not always a Killer by Ghamal de la Guardia
Do You Want to Ride Through another Bear Market? by MacroTides
Investors: Looking at a Post Debt Crisis World by Warren Mosler
Stock market Cycle Analysis by Erik McCurdy
Consensus: Groundhog Decade for Stocks by Ed Easterling
About the Author
For the most up-to-date Kimble analysis, check out Chris’s blog: Kimble Charting Solutions