Equity Rundown: Stay Long Financials and Maintain Defensive Positions
- By John Tierney
- 4 min read
Summary
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- Our model equity portfolio is down 2.9% since inception, largely due to poor performance of financials following the Silicon Valley Bank collapse.
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- We are bearish on equities because we think inflation will prove sticky and the Fed will not deliver the rate cut markets are pricing.
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- Our portfolio is generally positioned defensively. We maintain long positions in financials on expectations that the recent selloff was overdone.
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- We are unwinding our short position in Homebuilders given the strong earnings homebuilders have posted recently.
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