Day Hagan Smart Sector® International Strategy Update April 2025
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Day Hagan Smart Sector® International Strategy Update April 2025 (pdf)
Executive Summary
Stock Market Influences in March 2025: A Global Perspective
Global stock markets experienced a volatile month, shaped by a mix of macroeconomic shifts, policy uncertainties, and key economic releases. Below, we explore the factors, issues, and data points that influenced the U.S., European, Emerging Market, Japanese, Canadian, and Pacific ex-Japan stock markets last month.
U.S. Stock Market
The U.S. stock market faced a turbulent March, with volatility driven by trade policy uncertainty and mixed economic signals. The re-elected Trump administration’s aggressive tariff rhetoric—proposing hikes on imports from key partners like China, Mexico, and Canada—has rattled investor confidence. Fears of a trade war have weighed on export-heavy sectors like manufacturing and technology, contributing to a year-to-date decline of over 4% in the S&P 500. Economic releases have added to the uncertainty. The March Consumer Price Index (CPI) report showed inflation steady at 2.9%, above the Federal Reserve’s 2% target, dampening hopes for aggressive rate cuts. The Fed’s March 19-20 meeting minutes revealed a cautious stance, with the policy rate held at 4.25%-4.50%, signaling that inflationary pressures from potential tariffs and robust wage growth (still hovering around 4%) could limit further easing. The Atlanta Fed’s GDPNow model, updated on March 6, projected a -2.4% annualized decline for Q1 2025, driven by a surge in imports ahead of tariff deadlines, though consumer spending remained resilient. Investor sentiment has also shifted defensively, with a rotation out of tech mega caps (e.g., Nvidia is down 12% year-to-date) into bonds and utilities, reflecting recession fears. However, optimism persists in some quarters, fueled by anticipated deregulation and tax cuts boosting corporate earnings later in the year.
European Stock Market
European equities have been a bright spot. A major driver was Germany’s new government approving a €500 billion fiscal stimulus package on March 21, featuring infrastructure and defense spending. This has lifted growth expectations for the eurozone from 0.5% to 1% for 2025, boosting industrial and financial stocks. Economic data supported this rally. The March 3 PMI surveys showed manufacturing and services activity exceeding expectations, particularly in Spain and Italy, while Germany lagged due to high energy costs. Inflation eased to 2.5% in January (latest available), per Eurostat’s March 10 release, nearing the ECB’s 2% target, prompting speculation of a rate cut to 2% by year-end from the current 2.5%. Geopolitical tailwinds also helped. Progress toward a Ukraine ceasefire, reported on March 15, reduced risk premiums, lifting defense and energy stocks. However, U.S. tariff threats loom as a counterweight, potentially offsetting fiscal gains if implemented, especially for export-reliant firms.
Emerging Markets Stock Market
Emerging Markets (EM) equities evidenced resilience in March, buoyed by China’s policy shifts. Beijing’s March 5 announcement of additional stimulus—rate cuts and a $500 billion stock stabilization fund—sparked an 11.7% surge in Chinese equities, particularly tech, amid excitement over AI model DeepSeek. This offset broader EM concerns about U.S. tariffs, which threaten export-driven economies like Mexico and Southeast Asia. Economic releases painted a mixed picture. Brazil’s central bank hiked rates to 14.25% on March 18 to combat 6% inflation, pressuring local stocks. Conversely, India’s robust 7% GDP growth forecast (released March 1 by the RBI) supported gains in consumer and tech sectors. A weakening U.S. dollar provided a tailwind, enhancing EM debt and equity returns.
Japanese Stock Market
Japan’s TOPIX index has struggled despite a strengthening economic backdrop. The Bank of Japan (BoJ) raised its policy rate to 0.5% on March 25, per its meeting minutes, aiming for 1% by year-end, supported by a 2% “core” inflation rate (excluding food and energy) reported on March 20. Wage growth of 3% and labor shortages have fueled a virtuous wage-price spiral, lifting consumption. However, a stronger yen has hurt export competitiveness, pressuring automakers and electronics firms. U.S. tariff risks and a global shift away from Japanese bonds have compounded the downturn. Still, corporate reforms and a projected 1.2% GDP growth in 2025 offer some upside potential.
Canadian Stock Market
Canadian equities faced headwinds as U.S. tariff threats targeting Mexico and Canada (part of the USMCA) sparked fears of trade disruption. Energy and materials stocks, key to Canada’s market, weakened as oil prices hovered below $70/barrel amid rising global supply, per the EIA’s March 11 report. Economic data showed resilience. Statistics Canada’s March 7 release pegged unemployment at 6.6%, with GDP growth steady at 1.5% annualized in Q4 2024. The Bank of Canada held rates at 4.25% on March 5, citing sticky services inflation (3.5%), but signaled a potential cut to 3.5% by year-end if U.S. trade tensions ease. Consumer strength has cushioned losses, though tariff uncertainty remains a drag.
Pacific ex-Japan Stock Market
The Pacific ex-Japan region, including Australia and Hong Kong, posted a slight gain in March, per the MSCI Pacific ex-Japan Index. Hong Kong tech stocks have soared this year, driven by China’s stimulus spillover and DeepSeek’s AI buzz. Australia’s ASX 200 lagged, pressured by a weaker yuan (down 12% since 2018), reducing iron ore demand, as China’s exports faltered under U.S. tariff threats. Australia’s RBA held rates at 4.35% on March 18, per its minutes, with sticky inflation (2.8% in January) delaying cuts to 3.5% until mid-2025. PMI data on March 3 showed services growth offsetting manufacturing weakness, supporting modest gains. The region’s mixed performance reflects its sensitivity to China and U.S. policy dynamics.
March underscored the interconnectedness of global markets. The U.S. is grappling with tariff-driven volatility and inflation concerns, while Europe rides fiscal optimism tempered by trade risks. Emerging Markets lean on China’s stimulus, Japan navigates a stronger yen, Canada braces for trade fallout, and Pacific ex-Japan balances China’s influence with local resilience. Key economic releases—CPI, PMI, and central bank decisions—have shaped these trends, with geopolitical and policy uncertainties setting the stage for a potentially volatile Q2.
Holdings
Core: Developed Market Positions (approximately 65% of equity holdings)
Country
Australia
Canada
China
France
Germany
Japan
Switzerland
United Kingdom
Outlook
Neutral
Overweight
Overweight
Underweight
Neutral
Modest Overweight
Overweight
Neutral
Explore: Emerging Market Positions (approximately 35% of equity holdings)
India
Taiwan
Hong Kong
Peru
Sweden
Position Details
Core: Developed Market Commentary
Approximately 65% of the strategy is allocated across eight of the largest markets in the ACWI ex-U.S. Index. The fund overweights and underweights the largest non-U.S. equity markets based on macro, fundamental, behavioral, and technical indicators. Weightings are determined using the Black-Litterman framework, which seeks to reduce volatility and enhance returns.
Australia: Australia’s composite model held steady during March. Measures evaluating trend, commodity prices, and aggregate technical scores are negative. Interest rate differentials, relative volatility, and valuations are positive. We remain neutral.
Commentary: The Pacific ex-Japan stock markets, per the Pacific ex-Japan Index, gained, driven by Hong Kong’s tech surge resulting from China’s $500 billion stimulus and DeepSeek AI hype. Australia’s ASX 200 lagged as a weaker yuan hit iron ore demand. The RBA held rates at 4.35% on March 18, with inflation at 2.8%, delaying cuts. U.S. tariff threats under Trump added uncertainty, though China’s recovery buoyed intra-regional trade. PMI data on March 3 showed services growth offsetting manufacturing weakness. Volatility persisted, balancing China’s momentum against global policy risks. Recall that the Reserve Bank of Australia (RBA) reduced its cash rate by 25 basis points to 4.1% in February, marking its first cut since November 2020 due to a slowdown in underlying inflation. The RBA expressed increasing confidence that inflation is on track to reach its target range of 2–3%. However, it cautioned about an uncertain economic outlook, particularly regarding private demand and household spending recovery. Meanwhile, the S&P Global Flash Australia Manufacturing PMI rose to 52.6 in March from 50.4 in February, indicating robust manufacturing growth. The Services PMI also increased to 51.2, supported by higher demand despite declining export orders. In Hong Kong, the Monetary Authority maintained its base rate at 4.75% on March 20, aligning with the U.S. Federal Reserve’s decision. The HKMA noted that high interest rates might persist amid uncertainty surrounding future U.S. rate cuts.
Canada: Canada’s composite remains in overweight territory but has declined slightly. We are reducing exposure but remain overweight. Measures of valuation and country-specific leading economic indicators are negative. Indicators calling trend, mean reversion, technical aggregates, and relative currency strength are positive.
Commentary: The S&P/TSX Composite faced pressure from U.S. tariff threats under Trump, targeting Canada and Mexico, raising recession fears. Energy and materials stocks weakened as oil prices dipped below $70/barrel during the month. The Bank of Canada cut rates to 2.75% on March 12, per its announcement, supporting growth (1.5% Q4 2024), but trade uncertainty offset gains. Inflation held near 2%, aided by rate cuts, though tariff risks loomed. Consumer resilience cushioned losses, yet tariff uncertainty dominated sentiment. The Bank of Canada’s rate cuts now total 225 basis points since June 2024. The Governing Council highlighted that the Canadian economy has benefited from prior rate cuts, showing stronger-than-expected growth in the fourth quarter. However, growth is anticipated to slow due to escalating trade tensions with the United States. Ongoing tariff threats from the U.S. have negatively impacted consumer confidence and investment expectations, potentially undermining economic momentum. The Canadian dollar weakened, retreating from a one-month high as trade concerns and disappointing GDP data weighed on the currency. Prime Minister Mark Carney indicated Canada is prepared to impose retaliatory trade measures, heightening tensions. Furthermore, uncertainty regarding the Bank of Canada’s policy direction, especially in light of stagnant February GDP growth, has led to expectations of a more accommodating monetary stance compared to the U.S. Federal Reserve.
China: China’s composite model remains bullish but has pulled back from its peak. The gains appear extended based on our mean reversion indicator. Furthermore, when High-Yield credit spreads start to widen, it is often a headwind for Emerging Markets and China specifically. Measures of momentum, trend, PMIs, and a relative currency basket remain supportive. We are modestly reducing exposure but remain overweight.
Commentary: Emerging Markets (EM) stocks, per the MSCI EM Index, increased in March, driven by China’s $500 billion stimulus and DeepSeek AI buzz, lifting tech stocks over 11%. However, U.S. tariff threats under Trump rattled export-heavy economies like Mexico, while Brazil’s 14.25% rate hike on March 18 sought to curb inflation (6%) but pressured equities. India’s 7% GDP forecast (March 1) bolstered gains. A weakening U.S. dollar aided EM returns, though global rate uncertainty and a Chinese tech selloff late in the month tempered optimism. Key releases like PMI surveys and inflation data shaped a volatile yet resilient EM landscape. The People’s Bank of China (PBoC) decided to hold interest rates steady following the U.S. Federal Reserve’s similar action, while suggesting possible rate cuts later this year. The PBoC indicated intentions to lower interest rates and the reserve requirement ratio to address the sluggish economy. Additionally, Beijing introduced stimulus measures to boost domestic demand amid the impact of rising U.S. tariffs. On monetary policy, the PBoC focused on the seven-day reverse repo rate and introduced a new bidding system for MLF loans. The bank plans to issue CNY 450 billion in one-year MLF loans and hinted at potential rate cuts. In India, the rupee strengthened to its highest since December 2024, driven by foreign fund inflows. However, domestic market weaknesses capped further gains.
France: The Composite model for France improved with the April update. Technical indicators and valuations are bearish, with ETF flows showing signs of reversing. Measures of trend, breadth, and intermediate-term momentum are bullish. Based on the OECD Composite of Leading Economic Indicators, economic conditions are neutral. We are modestly increasing exposure but remain underweight.
Commentary: In March, France’s annual inflation rate remained steady at 0.8%, the lowest since February 2021. Similarly, the EU-harmonized inflation rate held at 0.9%, with a month-on-month increase of 0.2%. The HCOB Manufacturing PMI rose to 48.9 from 45.8 in February, exceeding expectations of 46.2. Despite remaining in contraction, this represents the mildest downturn since January 2023, driven by a slower output decline. Challenges from domestic and international uncertainties, competitive pressures, and weak demand in key sectors like automotive, construction, and agriculture persist. Meanwhile, the HCOB Services PMI improved to 46.6 from 45.3, slightly above the expected 46.3, although it marks the seventh consecutive month of negative readings. A significant output decline continues, influenced by economic uncertainties and geopolitical tensions, alongside ongoing job cuts within the sector. Input prices in services rose at the slowest pace in three months, indicating a moderation in inflationary pressures.
Germany: Germany’s composite model declined as the DAX surged, reflecting emerging overbought conditions. Valuations and euro currency measures have moved from undervalued to neutral. Breadth measures and some trend measures remain supportive. Overall, the model’s message is to reduce exposure back to neutral after the nice gains YTD.
Commentary: Market sentiment remained cautious amid increasing concerns over U.S. tariffs and trade tensions that may hinder global economic growth. A new set of retaliatory tariffs on U.S. imports, including a 25% tax on automobiles, is expected to take effect on April 2. Investors are also wary of potential U.S. duties on the pharmaceutical and tech sectors, contributing to pressure on banking and energy stocks. In March, the HCOB Germany Manufacturing PMI increased to 48.3 from 46.5 in February, signaling a mild contraction in manufacturing. Notably, there was a slight uptick in new orders attributed to stronger domestic demand, although new export orders continued to decline. Manufacturing job cuts slowed, reaching their weakest pace in nine months. Meanwhile, the HCOB Services PMI fell to 50.2, its lowest in four months, indicating a decline in business activity and new orders. Nonetheless, a €500 billion fiscal package (allowing for debt-financed defense and infrastructure spending) approved on March 21 bolstered growth forecasts to 1% for 2025 and lifted industrial and financial stocks.
Japan: Japan’s composite model pulled back in April. Forward earnings growth expectations have been declining, and technicals confirm that equities are taking notice. However, the moves are minor at this point. Technical measures are still relatively positive, and trend and sentiment measures are constructive. We are reducing exposure back to a neutral level (relative to the benchmark).
Commentary: The Bank of Japan (BoJ) maintained its key short-term interest rate at approximately 0.5% during its March meeting, the highest level since 2008, and aligned with market expectations. This unanimous decision followed the central bank’s third rate hike in January and occurred ahead of the U.S. Federal Reserve’s rate announcement. The BoJ expressed caution, evaluating the effects of rising global economic risks on Japan’s fragile recovery, while indicating potential further rate increases if the economic outlook remains stable. In March, the Au Jibun Bank Japan Manufacturing PMI fell to 48.3, marking the ninth consecutive month of contraction and the steepest decline in factory activity since March 2024. Meanwhile, the Au Jibun Bank Japan Services PMI dropped to 49.5, reflecting the first contraction in services activity since October and significant drops in new orders and employment. Cost pressures increased, leading to a notable increase in prices charged, with sentiment reaching a 50-month low due to concerns over rising costs and labor shortages.
Switzerland: The Swiss model composite’s technical indicators, including Moving Average Crosses, Market Breadth, Price Momentum, Moving Average Slopes, and sovereign yield trends, are bullish. The lone negative is that valuations, based on relative dividend yields, are getting extended. We remain overweight at this time.
Commentary: In March, the Swiss National Bank (SNB) lowered its policy rate by 25 basis points to 0.25%, the lowest since September 2022, amid low inflation and ongoing economic uncertainty. This decision marks the fifth cut in the current cycle. Inflation dropped from 0.7% in November to 0.3% in February, primarily due to reduced electricity prices, although domestic services continue to drive overall price increases. The SNB forecasts inflation at 0.4% for 2025, 0.8% for 2026, and 2027. Switzerland’s economy experienced steady growth at the end of 2024, supported by services and specific manufacturing sectors, despite a slight rise in unemployment. The KOF Economic Barometer improved to 103.9 in March, the highest since August 2024, indicating positive trends in manufacturing, services, and construction. The recent €500 billion German fiscal stimulus also positively influenced regional sentiment and benefited Swiss exporters.
United Kingdom: The U.K. composite model is neutral, with measures of valuations/profitability negative, and price momentum neutral. Technical measures, including moving averages, relative currency trends, sentiment, and U.K. option-adjusted spreads, are supportive. We remain neutral.
Commentary: The Bank of England maintained the Bank Rate at 4.5% during its March meeting, with an 8-1 vote reflecting a cautious stance amid persistent inflation and global economic uncertainties. One member, Swati Dhingra, proposed a reduction to 4.25%. The bank emphasized a gradual approach to monetary policy changes given the medium-term inflation outlook. CPI inflation rose to 3.0% in January, projected to increase to 3.75% by Q3 2025. In the manufacturing sector, the S&P Global Flash UK Manufacturing PMI fell to 44.6 in March, the lowest since late 2023, indicating ongoing deterioration. Conversely, the S&P Global UK Services PMI improved to 53.2, reflecting more substantial growth driven by increased domestic and overseas sales, with a notable decline in job losses. Consumer confidence remains fragile, with a headline score of -19 for March, highlighting the sensitivity of consumer sentiment amidst current economic conditions.
Emerging Market Positions
Approximately 35% of the strategy is allocated across five markets from a pool of more than 20 smaller markets. Selection is based on a multifactor technical ranking system using trend and mean reversion indicators. The process seeks to identify oversold opportunities within the global equity markets that are likely to mean-revert from lower levels and exhibit mild pullbacks from long-term uptrends.
Current Holdings:
India
Taiwan
Hong Kong
Peru
Sweden
Explore: Emerging Market Commentary
India: India’s stock market has demonstrated resilience amid global trade tensions, buoyed by strong domestic economic indicators and strategic policy measures. The Reserve Bank of India’s easing monetary policy, coupled with income tax cuts and liquidity infusions, supports economic recovery and investor confidence. Although the U.S. has imposed a 26% tariff on Indian imports, the impact is mitigated by India’s diversified export portfolio and the relatively modest share of exports to the U.S. in its GDP. Notably, the pharmaceutical sector benefits from exemptions to these tariffs, leading to a surge in related stocks. Additionally, India’s focus on enhancing domestic consumption and infrastructure development positions its equity markets favorably, despite external challenges.
Taiwan: Taiwan’s stock market faces headwinds due to newly imposed U.S. tariffs of 32% on its exports, prompting government intervention to bolster affected industries. A substantial economic support package of $2.7 billion aims to mitigate the tariffs’ impact, particularly on the electronics and steel sectors. The semiconductor industry, a cornerstone of Taiwan’s economy, remains exempt from these tariffs, preserving a critical revenue stream. However, concerns over global trade dynamics and political tensions contribute to market volatility. Despite these challenges, Taiwan’s commitment to maintaining its competitive edge through strategic investments and policy measures offers a buffer against external pressures.
Hong Kong: Hong Kong’s stock market has experienced a notable rally, reaching a three-year high, driven by positive investor sentiment towards China’s economic outlook and supportive policy initiatives. The anticipation of additional interest rate cuts by the U.S. Federal Reserve and further Chinese economic stimuli contributes to this optimism. However, the market remains sensitive to geopolitical tensions and global trade policies, including potential tariff implementations. The Mainland and Hong Kong Closer Economic Partnership Arrangement (CEPA) continues to facilitate trade, enhancing Hong Kong’s position as a financial hub. Overall, while external factors pose risks, internal economic policies and regional collaborations provide a foundation for market stability.
Peru: Peru’s stock market stands to benefit from the country’s robust economic growth projections and its strategic position in the global green transition. The central bank forecasts a 4% GDP growth for 2025, positioning Peru among the region’s fastest-growing economies. The nation’s rich endowment of critical minerals like copper and lithium, essential for clean energy technologies, attracts foreign investment and drives economic expansion. Additionally, Peru’s commitment to developing renewable energy infrastructure and improving human capital aligns with global sustainability trends, enhancing its appeal to investors focused on environmental, social, and governance (ESG) criteria.
Sweden: Sweden’s stock market outlook is bolstered by anticipated economic recovery and supportive fiscal policies. After a period of weak growth in 2024, the economy is projected to rebound with a 1.8% expansion in 2025, driven by easing financial conditions and falling inflation, which are expected to boost real income and domestic demand. Germany’s fiscal stimulus plans and efforts to reduce bureaucracy within the European Union further contribute to a favorable environment for Swedish equities. While the potential for escalated trade conflicts poses risks, Sweden’s diversified economy and proactive policy measures provide a buffer against external shocks, supporting a positive outlook for its stock market.
Catastrophic Stop Model
The Catastrophic Stop model combines time-tested, objective indicators designed to identify high-risk periods for the equity market. The model (Figure 1) held steady in March and entered April with a fully invested equity allocation recommendation. Technical measures calling U.S. Stock/Bond Relative Strength, Short-term Trend, Intermediate-term Trend, and High Yield OAS spreads are bearish. Conversely, global breadth statistics, sentiment, measures of economic activity, and equity demand remain bullish. Long-term oversold mean reversion indicators and High Yield/EM Bond breadth are neutral. Our indicators have not yet registered an intermediate-term breadth thrust. Breadth thrust signals don’t necessarily need to occur for the markets to mark a low, but they do increase the probability that a broader-based uptrend will be sustainable.
The weight of the evidence suggests that the current decline is not expected to extend into a significant downtrend. Of course, if our model flips to negative (below 40% for two consecutive days), signaling more substantial problems, we will raise cash immediately.
Figure 1: Catastrophic Stop Model vs. S&P 500 Total Return Index
This strategy utilizes measures of price, valuation, economic trends, monetary liquidity, and market sentiment to make objective, unemotional, rational decisions about how much capital to place at risk and where to place that capital.
For more information, please contact us at:
Day Hagan Asset Management
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Toll Free: (800) 594-7930
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Website: https://dayhagan.com or https://dhfunds.com
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Smart Sector® International ETF
Symbol: SSXU
Strategy Description
The Smart Sector® International strategy combines three quantitative investment strategies: Core International, Explore International, and Catastrophic Stop.
The Process Is Based On The Weight Of The Evidence
Core Allocation
The fund begins by overweighting and underweighting the largest non-U.S. equity markets based on proprietary models.
Each of the models utilizes market-specific, weight-of-the-evidence composites of fundamental, economic, technical, and behavioral indicators to determine each area’s probability of outperforming the ACWI, for example. U.S. Markets are weighted accordingly relative to benchmark weightings.
Explore Allocation
To select smaller markets, the fund uses a multi-factor technical ranking system to choose the top markets. The markets with the highest rankings split the non-core model allocation equally.
When Market Risks Become Extraordinarily High — Reduce Your Portfolio Risk
The model remains fully invested unless the Catastrophic model is triggered, whereupon the equity-invested position may be trimmed by up to 50%.
The Catastrophic Stop model combines time-tested, objective indicators designed to identify periods of high risk for the broad U.S. equity market. The model uses price-based, breadth, deviation from trend, fundamental, economic, interest rate, behavioral, and volatility-based indicator composites.
When Market Risks Return To Normal — Put Your Money Back To Work
When the Catastrophic Stop model moves back to bullish levels, indicating lower risk, the strategy will reverse toward being fully invested.
Disclosures
The data and analysis contained within are provided "as is" and without warranty of any kind, either express or implied. The information is based on data believed to be reliable, but it is not guaranteed. Day Hagan DISCLAIMS ANY AND ALL EXPRESS OR IMPLIED WARRANTIES, INCLUDING, BUT NOT LIMITED TO, ANY WARRANTIES OF MERCHANTABILITY, SUITABILITY, OR FITNESS FOR A PARTICULAR PURPOSE OR USE. All performance measures do not reflect tax consequences, execution, commissions, and other trading costs, and as such, investors should consult their tax advisors before making investment decisions, as well as realize that the past performance and results of the model are not a guarantee of future results. The Smart Sector® Strategy is not intended to be the primary basis for investment decisions and the usage of the model does not address the suitability of any particular in Fixed Income vestment for any particular investor.
Using any graph, chart, formula, model, or other device to assist in deciding which securities to trade or when to trade them presents many difficulties and their effectiveness has significant limitations, including that prior patterns may not repeat themselves continuously or on any particular occasion. In addition, market participants using such devices can impact the market in a way that changes the effectiveness of such devices. Day Hagan believes no individual graph, chart, formula, model, or other device should be used as the sole basis for any investment decision and suggests that all market participants consider differing viewpoints and use a weight-of-the-evidence approach that fits their investment needs.
Past performance does not guarantee future results. No current or prospective client should assume future performance of any specific investment or strategy will be profitable or equal to past performance levels. All investment strategies have the potential for profit or loss. Changes in investment strategies, contributions or withdrawals and economic conditions may materially alter the performance of your portfolio. Different types of investments involve varying degrees of risk, and there can be no assurance that any specific investment or strategy will be suitable or profitable for a client’s portfolio. Historical performance results for investment indexes and/or categories generally do not reflect the deduction of transaction and/or custodial charges or the deduction of an investment management fee, the incurrence of which would have the effect of decreasing historical performance results. There can be no assurances that a portfolio will match or outperform any particular benchmark.
Day Hagan Asset Management is registered as an investment adviser with the United States Securities and Exchange Commission. SEC registration does not constitute an endorsement of the firm by the Commission nor does it indicate that the adviser has attained a particular level of skill or ability.
There may be a potential tax implication with a rebalancing strategy. Re-balancing involves selling some positions and buying others, and this activity results in realized gains and losses for the positions that are sold. The performance calculations do not reflect the impact that paying taxes would have, and for taxable accounts, any taxable gains would reduce the performance on an after-tax basis. This reduction could be material to the overall performance of an actual trading account. Day Hagan does not provide legal, tax or accounting advice. Please consult your tax advisor in connection with this material, before implementing such a strategy, and prior to any withdrawals that you make from your portfolio.
There is no guarantee that any investment strategy will achieve its objectives, generate dividends or avoid losses.
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