The Mosaic Global Fund had a -3.53% return for the month of July.
The US Economy showed continued resilience and the Federal Reserve reported about a continued strong labor market. Despite this the FED is taking a cautious stand on the US inflation. The focus on China continued with global market participants showing serious concerns due to heavy restrictions on selling stocks, including IPO’s or initial public offerings. These types of restrictions and interventions have historically never been received positively by investors, and in actuality tends to worsen the volatility of the respective market. Due to the uncertainty that the restrictions comes with, investors instead of calming down, will get more nervous and as a result flood the markets with more shares. Positive for the equity markets during July where the improved situation in Greece, which helped the US index Nasdaq to a new all-time high during the month despite weaker reports from some of the index blue chip stocks.
The Mosaic Global Fund showed slight positive performance in US stocks and bonds. The month’s losses came primarily from the commodity sector with especially the energy complex experiencing another month of heavy selling. The US stock markets continue to trade within a very narrow range with European markets being relatively weaker. Looking at global assets there are negative trends almost across the board with the US stock market being one of the only assets holding its positive trend. Across the board from, Emerging Markets, Commodities, Gold are all showing negative trends.
As I discussed in the previous monthly commentary, the trend-less markets continue with stocks going up and down in a narrow trading range. When this range is broken we will most likely see some strong moves again. Until then we will need to continue to focus on executing our strategies and try not to engage in second guessing the outcome for the next position or trade. One of the most difficult thing as an investor is to shut out all the noise that is coming our way on a daily basis. There are thousands of media outlets constantly updating us by the minute on what is going on in markets around the world.
With this much information we need a framework to fall back on when investing. This framework will help us to have an edge in the market place – it basically helps us to stay on course however volatile or emotional the markets become. Important to understand is that this framework will not make money each month, but it will help us to minimize the volatility in our portfolios and make sure that we stay invested and participate in strong positive trends in markets when they occur. This way we will extract as much of the positive returns that market provides while trying our best to avoid the most volatile times. Finally I would like to add that, as investors, investing during a period with strong returns is never a challenge, it is during difficult periods that executing an investment strategy becomes hard. During these faces it is more important than ever to stay the course and to not get sucked in to the constant noise from reporters and pundits constantly having a view.
Please reach out to us on this email firstname.lastname@example.org, or give us a call on +352 202 033 27, to find out more about the Mosaic Global Fund and how the Fund is managed with our Trend and Momentum Filters. We look forward to speaking with you soon.
To Your Investment Success!
Per-Olov Jansson & the Cardea Investment Team