The past month has been an absolute rollercoaster ride: Despite the corona virus, the Nasdaq initially rose steadily for 20 days on positive earnings and peaked at 8%. Then suddenly it fell by over 16% in just 10d. As usual, stocks took the stairs up but rushed down with the elevator. The fastest elevator in the past 50 years, to be exact.

Our two strategies unfortunately also took a hit in February, with High Yield Classic -5.51% and High Yield MiniMax -6.5% wiping out much of the January gains.

Nobody knows for sure what the future will bring, but in general we are still in a growing economy where companies continue to exceed expectations on both earnings and revenues. It all depends on how people will further react to the spread of the corona virus. And on how the Fed will react to these reactions with further interest rate cuts to improve the environment for equities and bonds.

What I know for sure is that particularly in times like these, a systematic approach is essential. It is very likely that volatility will increase until the sky turns blue again, but timing the markets is futile. We are investing for the next three to five years, not for the next three to five days or even months. 

For those of you who are just starting out to become “PentaTraders”, welcome the adventure and fasten your seat belts.

Stay happy, healthy and wealthy!

Omar