Columbus Strategy Report – October 2018 Edition

An Emphasis on US Stocks

  • The Federal Reserve increased interest rates yesterday and signaled more hikes to come in December and at least 3 more next year on the basis of a strong economy.  Since rates are still very low by historical standards, the Fed believes they can hike rates further while sustaining a very strong economy.
  • Given this backdrop, Columbus is raising its allocation to US stocks to near maximum at the expense of a major cut in its allocation to real estate.
  • Meanwhile, a rising US rate environment relative to the rest of the world bodes well for the dollar, so Columbus is maintaining a reasonable holding in the US Dollar bullish ETF.

To learn more about the rationale for this month’s allocation decisions, I encourage you to download the report and read the discussion in section 6.  As always, section 3 of the report includes the detailed allocations for the upcoming month.

Investing is all about risk management, a foundational element for growing client’s wealth in the long run. Although many uncertainties surrounding the market remain, these are now fading for the time being.  As a result, Columbus is taking a more aggressive stance with an emphasis on stocks for the next month.  Should this situation degrade in the near future, Columbus will revert back to a more prudent allocation. For now however, it is positioned to take full advantage of the growth in US stocks.

Please don’t hesitate to contact us should you have any questions.

Best regards,

Laplace Insights Team

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