The Madison Letter: Weekly Update

by Dominic de la Guardia | 12/18/2015 09:25 PM
The Madison Letter: Weekly Update

We are invested on our overall Market Call. Since inception, our overall timing return is 75.55% versus 43.71% on the S&P 500 for excess return of 31.84%.

Madison scores on the major indexes are in a range of -9 to -11. Stocks and indexes moved lower week over week.

We are live with our ETF Morning Matters Portfolio. There is a buy now on UNG. The recommended price is $11.76 and it closed yesterday at $6.92. As the heating season kicks, we expect natural gas to move higher. We have been early on this call.

The portfolio will have up to 6 buys at a time. So if you allocate, $30,000 to the portfolio as an example you would buy $5,000 of each recommendation. We will use a $5,000 allocation for tracking purposes as well. We are very excited about this process.

The range between the buy and sell points is above average. As an example, the S&P 500 range was 54 points at the low and is now at 107 from 90 since our last update. As volatility rises, this expands so it is interesting that the range peaked several weeks ago but is falling again. Witness at the October 2014 low the range was 169 points and now we are at 90.

Also, in tracking the range between the 2 year and 10 year moves to 124 from 126 basis points week over week. Short term rates are on the rise in addition to long term rates. This needs to be watched closely. There are implications, can you say flat yield curve.

We began to offer a buy and sell strategy via our Madison Market Timing Indicator at the beginning of April of 2007. There are now 24 open and closed winning trades to 8 closed losing trades with our market timing results. This gives us lots of confidence in the upcoming portfolio launch.

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