Summary

After another tumultuous week, markets face continued downward pressure due to lingering domestic and global concerns:

market valuations (bubbles?), AI implications, geopolitical tensions (potential Iran strike), new global tariffs, GDP/inflation reports, interest rate uncertainty and government shutdowns.

As a result of these persisting market trends, StormGuard-Armor has turned negative, indicating we MAY be entering (or already entered) the beginning of a prolonged market downturn or potential bear market.  

What does this mean?  

StormGuard is a key factor in our unique Dual Defense portfolio strategies.  It is an advanced algorithm fed by thousands of market and economic data points to help make unemotional decisions regarding investment posture.  

• When StormGuard is POSITIVE, we hold traditional growth-oriented investments diversified across trending market sectors, factors and themes

• When StormGuard is NEGATIVE, we shift holdings to dedicated "Bear Market Strategies" that are defensive in nature, helping to mitigate market losses and even make moderate gains without having to "ride the markets down" with everyone else (examples include Govt Treasuries, Bonds, Gold/Metals, Defensive Sectors).

What happens next?  

• Taking a tactical pause to digest data and avoid knee-jerk reactions

• StormGuard reading of -0.01 is barely negative and worth taking a few extra days to define the actual trend

• Assuming the negative reading holds or deepens, I will evaluate the Bear Market Strategy portfolio to ensure the new holdings are appropriate for current conditions (ex. bonds are considered to be a safehaven during market downturns; however duing the 2022 bear market, bonds offered no security and lost -13%)

• Qualified accounts (IRAs, Solo-Ks, etc) would be manually reallocted to bear market strategies since there are no tax implications with internal trading/rebalancing

• Nonqualified / taxable accounts (Individual, JTWROS) are already positioned to be resilient and defensive -- core EZRO ETF holding will naturally adapt from current bull market holdings to defensive bear market positions at the ETF fund manager level, which prevents the need to sell off individual positions that could trigger capital gains

Bottom line

StormGuard-Armor is not a crystal ball - it is a tool to help make unemotional decisions to protect account values. Short-term declines, while unpleasant to see, are completely normal and unavoidable.  Bear markets are also normal; however, rather than fear it, we are prepared to adapt if that is indeed the case, and even profit from it using alternative strategies that are inversely correlated to “normal” market forces.