Market Map Allocates To Long Bond

Summary

– The Market Map model indicates allocation to long bonds

– Since 1924, there were 16 instances of long bond allocation

– This allocation applies to the 3rd quarter of 2016

As another predefined date for asset allocation action as defined * by the Market Map model has been reached, at this time the model is indicating an allocation from cash (position allocated on 01/29/2016) to a 75% allocation in the iShares 20+ Year Treasury Bond ETF (NYSEARCA:TLT). The model identified 16 previous instances of allocation to long bonds in the investment timeline since 1924.

7/1/1929 9/30/1929 1.70%
7/1/1930 10/6/1930 -0.20%
7/11/1946 9/30/1946 -6.1%
7/5/1960 10/3/1960 2.6%
9/3/1982 10/2/1982 5.5%
7/10/1992 10/2/1992 3.2%
7/11/1997 10/3/1997 6.6%
7/2/1998 10/2/1998 9.7%
7/2/1999 10/2/1999 1.1%
7/6/2000 9/28/2000 3.4%
7/6/2001 9/29/2001 7.5%
7/5/2002 10/4/2002 15.9%
7/3/2008 10/3/2008 4.5%
7/9/2010 10/1/2010 6.6%
7/8/2011 9/30/2011 21.3%
7/11/2014 9/29/2014 3.50%
7/8/2016 9/30/2016 ?

As we can see from the chart below, there is statistically significant negative correlation between long bonds and S&P500 during Map model bond allocation signaling.

The long bond allocations within the full record of model allocation changes can be seen here.

* Objective # 3. To make infrequent asset allocation changes occurring on fixed, predefined dates during the course of market cycles. See objectives.

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