It’s been about 3 weeks since the US election was decided (depending on who you talk to) and it was the third week in a row where there was good news on COVID vaccines.

Most of the major benchmarks hit record highs. Hopes of a reopening boosted cyclical stocks, and positive preliminary vaccine results reassured investors.

The political environment also seemed to be supportive after reports that President-elect Joe Biden was preparing to nominate former Federal Reserve Chairman Janet Yellen as Treasury Secretary. While President Trump still refused to concede, stocks rallied further on news that he had authorized the General Services Administration (GSA) to formally begin transitional measures in preparation for a Biden administration. 

The actual economic data was less favorable: unemployment claims unexpectedly rose to their highest level in five weeks, while personal incomes declined and consumer sentiment reached its lowest level since August. 

It was an impressive month, and unless a global financial crisis occurs today, it looks like November will be the best month for global markets in a long time: The S&P 500 rose by 10.4% and the MSCI World Index even by 12.0%! 20-year bonds stayed almost stable at +0.4%. 

Our strategies performed overall nicely as well with Pro +10.9% and MiniMax +17.0%. Universal closed sideways at -0.2%.

Usually the saying goes that markets go up the stairs and down the elevator. So a rapid upward movement like this is very rare and may be associated with greater volatility ahead.

Personally, I watch this rally with mixed feelings, as it has happened at all market highs and inconclusive economic data. Interestingly it seems that our strategies felt the same way, because none of them are fully invested for December.

I am really curious to see how this crazy year will come to an end…

Stay happy, healthy and wealthy!

Omar