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Buying the non-Volatility

The Market’s been choppy…but not volatile. 

Although there’s been recent selling pressure, volatility as measured by the VIX has been in decline.  In fact, despite the current selloff, the VIX is at its lowest level since pre-COVID February 2020.  That’s an extremely positive market indicator.

This drawdown is also characteristic of a 2021 pattern: end-of-month selloff, followed by a record high.  I think this pattern is likely to hold up, especially as institutional investors rebalance their portfolios for 2nd Quarter.

Other reasons the Market has been moody include:

  • Prices have gotten ahead of themselves…as they always do on the way to another high
  • $1.9T Stimulus “sell the news” event
  • NASDAQ is hitting 50dma resistance, because of rotation out of Tech & stay-at-home stocks
  • Rising interest rates, although the 10 Year Treasury is now back below 1.7%
  • COVID is spiking again…I’m sure Yogi Berra has a quote for that
  • Concern about vaccine side effects and efficacy

 My level of apprehension about the above items is slightly higher than my interest in Prince Harry and Meghan.

As such, today I added to 59 of my existing core positions.  I think the overall economic outlook remains strong and this is an opportunity for a secondary entry point. 

Do you want to know SPECIFICALLY what to buy?  It doesn’t matter.  Opportunity abounds.  Throw darts at the COVID90 portfolio…it works for me !

Watch for Episode 324 of the Wealthsteading Podcast where I’ll cover these matters in more detail.

If you find these ALERTs informative, please share them with a likeminded friend.