The Day Hagan Catastrophic Stop Model improved to 68.18% as the U.S. Corporate High-Yield Bond OAS (option-adjusted spread) factor declined (meaning spreads narrowed), generating a buy signal for equities. Overall, the model continues to support benchmark-level equity exposure.

The Day Hagan Smart Core Equity portfolio seeks to invest in companies with positive economic profitability, sound balance sheets, durable cash-flow generation, and valuations that may provide a margin of safety. We believe this combination of quality, profitability, and valuation can help identify attractive long-term opportunities across market cycles.

The Day Hagan Catastrophic Stop Model improved to 63.64% as the High-Yield Bond Breadth Factor reversed from oversold territory, reinforcing the model’s continued support for benchmark-level equity exposure.

July reminded investors that a bond can offer attractive income and still lose ground when the market reprices inflation, policy, and supply. The 3-month Treasury bill ended the month near 3.78%, only two basis points lower than in June. Farther out, the 5-year yield rose 21 basis points to 4.45%, the 10-year climbed 26 basis points to 4.74%, and the 30-year increased 31 basis points to 5.28%.

July reduced the international equity debate to two powerful forces. The first was the technology investment boom, which continued to lift semiconductor equipment, foundries, memory, data-center infrastructure, and advanced manufacturing. The second was the renewed energy shock from the Iran war.

July was a month of sharp contrasts. The S&P 500 slipped only 0.1%, but the calm index result hid a forceful rotation. Energy gained 10.8%, Financials rose 6.4%, and investors moved toward companies tied to oil, credit, defense, infrastructure, and current cash flow. Technology weakened, with semiconductor shares absorbing the sharpest selling. The market did not reject artificial intelligence.

Join Art Day, Partner, Co-Founder, and Senior Portfolio Manager, for a timely discussion on today's market environment and the investment themes shaping opportunities across sectors. Learn how the Day Hagan Smart Sector Strategies and Catastrophic Stop Overlay are designed to help investors navigate changing market conditions through a disciplined approach to portfolio management and risk control.

The Catastrophic Stop model continues to support benchmark equity exposure. The message is participation with a seat belt: remain invested while respecting the model’s clearly defined risk boundary. A reading below 40% for two consecutive days would shift the evidence toward defense.

The Day Hagan Catastrophic Stop model held steady at 59.09%. The model continues to indicate that investors should maintain their benchmark equity allocation.

The Day Hagan Catastrophic Stop model held steady at 59.09%. The model continues to indicate that investors should maintain their benchmark equity allocation.

In June, the U.S. equity market became more selective. The first half still belonged to earnings, AI infrastructure, power demand, defense spending, and companies able to protect margins in a higher-cost world. Yet the month also showed that leadership can rotate quickly when rates rise, inflation data firm up, and investors question whether the most crowded growth trades have already been priced in.

With this month’s rebalance, we are expanding the Smart Sector International opportunity set by adding South Korea, Taiwan, India, and the Netherlands to the Developed Market lineup. This is not a cosmetic change. It reflects how global market leadership has changed.

June turned fixed income into a contest between income and inflation. May payrolls, released in June, rose by 172,000, unemployment held at 4.3%, and wage growth cooled to 3.4%. Growth was firm enough to support credit, but not weak enough to make duration an easy call. Inflation was the problem. May CPI rose 4.2%, PCE rose 4.1%, and core PCE climbed to 3.4%.

The Portfolio is designed to invest in companies that we believe have the potential to deliver excess returns through positive economic profitability, solid balance sheets (quality), meaningful cash generation (profitability), and trading at considerable margins of safety (valuation). We believe these factors will continue to provide rational opportunities for the foreseeable future.

The Day Hagan Catastrophic Stop model declined to 59.09% as the Stock/Bond Relative Trend Factor turned negative. The model continues to indicate that investors should maintain their benchmark equity allocation.

The Day Hagan Catastrophic Stop model remained at 68.18%. The model continues to indicate that investors should maintain their benchmark equity allocation.

The Day Hagan Catastrophic Stop model declined to 68.18%. The model continues to indicate that investors should maintain their benchmark equity allocation.

The Day Hagan Smart Core Equity Portfolio is designed to invest in companies that we believe have the potential to deliver excess returns through positive economic profitability, solid balance sheets (quality), meaningful cash generation (profitability), and trading at considerable margins of safety (valuation). We believe these factors will continue to provide rational opportunities for the foreseeable future.

The Day Hagan Catastrophic Stop model remains at 86.4%. The model continues to indicate that investors should maintain their benchmark equity allocation.

The Day Hagan Catastrophic Stop model held steady at 86.4%. The model continues to indicate that investors should maintain their benchmark equity allocation.