Day Hagan Smart Sector® International Strategy Update May 2025
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Day Hagan Smart Sector® International Strategy Update May 2025 (pdf)
Executive Summary
Given the massive swings in the market last month, it may surprise you to learn that the S&P 500 was down only -0.68% for the month. Perhaps more surprising is that the Nasdaq Composite was up 0.85%. Internationally, Japan, Germany, and Canada were also up (0.37%, 2.17%, and 0.15%, respectively). Fixed income also increased, with the Barclays Capital Aggregate Bonds Total Return up 0.42%. All of this occurred with the U.S. Dollar Index down -4.36% for the month, and -8.16% YTD. All in all, a fairly impressive performance for global financial assets given the heightened uncertainty around geopolitical risks.
U.S. Equity Markets: Resilient but Volatile
U.S. equities experienced a mixed month, with the S&P 500 facing near-term volatility amid policy uncertainty from the new Trump administration’s tariff announcements, including a sweeping “reciprocal tariffs” policy on April 2. U.S. equity valuations declined post-January due to heightened policy uncertainty, with analysts cutting 2025 S&P 500 earnings growth forecasts from 14% to 9% due to tariff-related pressures on consumer discretionary and industrials sectors. Despite this, inflows remained robust, with less than 1% of post-election inflows reversed, signaling investor confidence in U.S. corporate strength. The Federal Reserve’s cautious approach—unlikely to cut rates below 4% amid sticky inflation—supported market resilience.
Europe: Signs of Outperformance
European equities showed signs of outperformance, bolstered by compelling valuations (forward P/E multiples at a 45% discount to the U.S.) and aggressive European Central Bank (ECB) easing. Improving bank lending is a key indicator of potential eurozone demand revival. It was reported that there was $3.4 billion in inflows to European equities, reflecting investor optimism. A potential ceasefire in Ukraine could further boost sentiment, benefiting European markets exposed to infrastructure and energy. However, Germany’s manufacturing challenges and trade policy uncertainties posed risks.
Emerging Markets: Mixed Performance Amid Headwinds
Emerging Markets (EM) saw modest inflows but faced challenges from tightening global financial conditions. The IMF’s April 2025 Global Financial Stability Report warned of high valuations and debt sustainability risks in EM economies, exacerbated by geopolitical risks like U.S.-China trade tensions. China’s MSCI Index, however, showed resilience with 11% EPS growth, driven by share buybacks and policy stimulus. India and Taiwan benefited from tech export recovery, while Mexico faced volatility ahead of 2026 USMCA renegotiations.
Japan: Steady but Yen-Sensitive
Japanese equities attracted investor inflows, supported by positive U.S. economic spillovers and a stabilizing manufacturing sector. Japan’s outlook reflects a “second derivative” of U.S. growth, though a stronger yen, driven by narrowing U.S.-Japan interest rate differentials, posed risks to export-heavy firms. The Bank of Japan’s prudent tightening amid a virtuous wage-inflation dynamic supported domestic growth, but global trade tensions remained a concern.
Pacific ex-Japan: Tariff Risks Loom
Pacific ex-Japan markets, particularly Australia, faced volatility due to tariff risks tied to China exposure. Reserve Bank of Australia’s gradual rate cuts support modest growth, but the Australian dollar’s volatility weighed on equities. New Zealand’s aggressive rate cuts improved its outlook, though trade surplus risks lingered.
Canada: Policy Uncertainty Impacts Performance
Canadian equities saw muted performance amid U.S. tariff threats tied to immigration and drug flows, as highlighted by S&P Global. The resignation of Canada’s prime minister added to policy uncertainty, dampening investor sentiment. However, stable GDP growth forecasts (around 2%) provided some support.
Conclusion
April underscored the complex interplay of central bank actions, U.S. dollar strength, and geopolitical risks. While U.S. markets remained resilient, Europe and select EMs offered opportunities amid undervaluation and policy support. Investors should stay nimble, monitoring trade policies and currency movements.
Holdings
Core: Developed Market Positions (approximately 65% of equity holdings)
Country
Australia
Canada
China
France
Germany
Japan
Switzerland
United Kingdom
Outlook
Neutral
Neutral
Underweight
Neutral
Overweight
Neutral
Underweight
Neutral
Explore: Emerging Market Positions (approximately 35% of equity holdings)
India
Taiwan
Hong Kong
Israel
Philippines
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 remains neutral. Short-term trend indicators have turned positive, while relatively low volatility (compared to other countries) is supportive. Headwinds include a lower relative earnings yield, weaker mean reversion and deviation from trend positioning, and the longer-term trend factor is still rated neutral.
Commentary: Following the U.S. announcement of a 10% tariff on key trading partners on April 2, the ASX 200 index suffered a 6.5% decline on April 3, primarily affected by mining and financial stocks, representing 31% and 28% of the index, respectively. A subsequent 90-day pause on tariffs announced on April 9 prompted a modest recovery, with the index closing with an increase of 0.36%. Australia’s export-driven economy, where 20% of GDP is linked to trade, remained vulnerable, notably in iron ore and coal exports to China, amid a potential slowdown in China’s GDP growth from 5.4%. The Reserve Bank of Australia held rates steady, but with inflation reaching 3.6%, concerns over potential rate hikes emerged, particularly impacting real estate sectors. Consumer discretionary stocks rose, bolstered by steady retail spending, while the technology sector benefited from rising global demand for AI. Conversely, global recession fears and a stronger Australian dollar challenged exporters.
Figure 1: The uptrend in gold is bullish for Australia.
Canada: Canada’s composite model dipped in mid-April and has recovered to neutral. Trend, mean reversion, and relative currency trends are bullish. Weaker relative earnings and deteriorating leading economic indicators are negative. We are neutral relative to the benchmark.
Commentary: In its April decision, the Bank of Canada (BoC) kept the benchmark interest rate steady at 2.75%, marking the first pause after a series of cuts totaling 2.25 percentage points. Most market participants anticipated this decision, as the BoC highlighted uncertainties surrounding U.S. tariffs, which posed risks to growth while raising inflation expectations. The central bank outlined two potential economic scenarios in its recent Monetary Policy Report. If the U.S. restricts tariffs on Canada, growth may weaken temporarily, keeping inflation near the 2% target. Conversely, an escalated trade conflict involving both Canada and China could lead to a recession this year, with inflation rising to approximately 3%. The Canadian dollar neared a six-month high amid a broad move away from U.S. assets and a reevaluation of domestic policy in light of the newly re-elected Liberal Party government. The Liberal Party, led by former BoC and Bank of England Governor Mark Carney, won a narrow victory, resulting in a minority government that placed modest pressure on the Loonie. On the Toronto Stock Exchange, the S&P/TSX Composite Index reached its highest level in over three weeks on the news. Investors responded positively to Carney’s experience in central banking as a stabilizing factor during ongoing tariff disputes, anticipating possible relief for Canadian auto-parts suppliers if U.S. tariffs on imports are eased.
Figure 2: Canada’s recent relative strength is rolling over.
China: China’s composite model deteriorated in April. Technical measures shifted negatively, including relative price momentum, mean reversion, and trend. Relative currency trends are also negative, and the increase in high-yield credit spreads is a headwind for business and consumer credit. We do note that China’s manufacturing and service PMIs are currently above 50, indicating modest expansion.
Commentary: In April, the People’s Bank of China (PBoC) maintained its key lending rates for the sixth consecutive month, a decision in line with market forecasts. This pause comes as the central bank assesses the evolving consequences of ongoing U.S. trade tensions before considering additional stimulus measures. China’s GDP growth exceeded expectations at 5.4% year-on-year in Q1 2025, the highest in 18 months, bolstered by government efforts to stimulate domestic consumption, including issuing CNY 300 billion in special treasury bonds for a consumer goods initiative. However, recent data revealed a sharper-than-expected contraction in manufacturing activity and an underwhelming performance in the services sector, raising concerns about potential economic fallout from trade disputes. Despite these challenges, the Chinese Yuan has appreciated to a five-month high, driven by indications of progress in U.S.-China trade negotiations. Senior U.S. officials have been actively seeking dialogue on tariff disputes, prompting Chinese officials to demand the removal of unilateral tariffs. In a move to ease trade flows, Beijing exempted various sectors from its reciprocal 125% tariff on U.S. goods, aiming to stimulate exports as new orders for Chinese manufacturers plummeted to a near three-year low in April.
Figure 3: High-yield option-adjusted spreads are a good proxy for risk-on or risk-off and are useful for calling risk-on asset classes like China’s equity markets.
France: The Composite model for France remained neutral entering May. Improving equity breadth measures and relative valuations are supportive. However, technical indicators, including trend and momentum, have not yet confirmed the improvement. The OECD Composite Leading Indicators is neutral, and the relative dividend yield is negative. The net result is a neutral allocation.
Commentary: The CAC 40 index rose to its highest point in a month last week, driven by positive trends in global markets amid easing U.S.-China trade tensions. China’s Commerce Ministry noted that the U.S. has shown a willingness to discuss tariff negotiations, with Beijing reciprocating this openness. In France, manufacturing activity, as indicated by the HCOB France Manufacturing PMI, increased to 48.7 in April, up from 48.5 in March and surpassing the initial estimate of 48.2. While still in contraction territory, this represents the least severe decline since the downturn began in February 2023. Notably, output saw its first rise in nearly three years, primarily in consumer and investment goods, with a slower decrease in new orders for the fifth consecutive month. Conversely, the HCOB France Services PMI dropped to 46.8, down from 47.9, marking an eighth month of contraction and the sharpest decline since February. Service providers cited a significant reduction in new orders as the main factor behind this downturn, prompting additional cuts in staffing. Despite some improvement in manufacturing, overall business confidence remains weak as inflationary pressures ease.
Figure 4: Leading economic indicators for France leveling out. Rated neutral.
Germany: Germany’s composite model is bullish. Measures of equity breadth, trend, relative dividend yield, and business confidence are bullish. The recent slight pullback in the Euro is negative, along with slowing ETF inflows into the region. We are monitoring the ETF flows for signs that this was more than investors becoming more defensive during April’s volatility. We are overweight relative to the benchmark.
Commentary: Market sentiment improved following a stronger-than-expected U.S. jobs report, which eased recession fears, and renewed optimism in U.S.-China trade discussions. In Europe, economic data showed inflation remained steady at 2.2% in April, while core inflation increased slightly from 2.5% to 2.7%. The final PMI data for April pointed to early signs of recovery in manufacturing. Germany’s GfK Consumer Climate Indicator increased to -20.6 for May 2025, up from a revised -24.3, surpassing the forecast of -26.0. This is the highest value since November 2024, driven by positive developments in coalition talks despite new tariff announcements in early April. Expectations for income reached their highest since October at 4.3, while willingness to buy improved to -4.9 from -8.2. Economic expectations also rose for the third consecutive month, reaching 7.2. The HCOB Germany Manufacturing PMI was revised upward to 48.4 in April, the highest in over two years, thanks to increased output. However, the HCOB Germany Services PMI fell to 48.8 from 50.9, the first drop since last November, reflecting concerns over tariffs and market uncertainty, despite continued job creation at its fastest rate since May last year.
Figure 5: German manufacturing confidence is improving.
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) following April’s relative outperformance.
Commentary: The Japanese yen was weak during most of April and has just recently bounced off levels last seen in September, as U.S.-China trade relations showed signs of improvement. China is evaluating the possibility of trade discussions in response to various outreach attempts from the U.S. Meanwhile, Japan and the U.S. wrapped up their second round of bilateral trade negotiations last week, with Japan targeting a finalized agreement by June. Domestically, Japan’s unemployment rate rose to 2.5% in March, yet the labor market remains tight. Additionally, the Bank of Japan opted to maintain its policy rate at 0.5% while revising its growth and inflation forecasts downward, indicating a reduced chance of imminent rate increases. In April, the au Jibun Bank Japan Manufacturing PMI improved slightly to 48.7, marking the tenth consecutive month of contraction due to waning demand and ongoing tariff concerns. Conversely, the Services PMI increased to 52.2, reflecting solid growth in new orders and hiring. However, business optimism fell to its lowest level since January 2021 amidst uncertainties surrounding potential U.S. tariff hikes and broader global economic challenges.
Figure 6: Investor sentiment for the Nikkei is pessimistic. A reversal from these lows would be bullish.
Switzerland: The Swiss model composite’s technical indicators turned negative entering May. Measures of trend, momentum, relative strength, relative dividend yield, sovereign yield trends, and ETF flows are negative. We are underweight.
Commentary: In April, the KOF Economic Barometer dropped to 97.1, down from a revised 103.2 in March, significantly missing market expectations of 102. This decline marks the lowest level since October 2023, reflecting adverse trends across most sub-indicators. The manufacturing sector faced substantial declines, with weak performance noted in vehicle manufacturing, machinery and equipment, paper and printing, and the electrical industry. The only area that showed stability was financial and insurance services. Concerning the producing industry, while most sub-indicators trended negatively, the stock of finished products did see a slight improvement. The Swiss Manufacturing PMI also fell to 45.8 in April from 48.9 in March, hitting a nine-month low and falling short of expectations of 48.6. This marked the 28th consecutive month below the 50-point threshold, signifying ongoing sector contraction. Key metrics displayed widespread weakness: order backlogs fell to 44.6, purchasing volumes to 44.1, employment to 44.0, and inventories to 41.5. Although finished goods stocks decreased to 42.3, production saw a minor increase to 49.7 yet remained in contraction territory.
Figure 7: A slowing international ETF net issuance rate has historically been negative for the Swiss market.
United Kingdom: The UK composite model is neutral, with measures of short-term momentum reversals, sentiment reversing from extreme pessimism, and UK-based option-adjusted spreads positive. The trend is still under pressure, and valuations are less attractive.
Commentary: The British pound remained close to its highest level since February 2022, supported by a weaker U.S. dollar. It recorded a 3.2% increase in April, marking its strongest monthly performance since November 2023. Notably, the UK is seen as relatively insulated from U.S. tariffs, which are paused until July, contributing to a $12 billion U.S. goods surplus with the UK in 2024, contrasting with deficits experienced with China and the EU. Market expectations suggest the Bank of England will proceed cautiously on interest rate cuts, with approximately 85 basis points of easing anticipated this year, similar to the Federal Reserve (at around 100 bps). In April, the revised S&P Global UK Manufacturing PMI improved to 45.4, up from a preliminary 44.0 but still indicating a contraction in the sector. The decline in output and a sixth consecutive month of employment losses reflected weakening demand, impacted by global economic uncertainty. The S&P Global UK Services PMI fell to 48.9, down from March’s 52.5, indicating renewed business activity contraction and a decline in new orders, influenced by rising inflation and growing recession concerns domestically and internationally.
Figure 8: Investor sentiment for the FTSE 100 has reversed from pessimism.
Emerging Market Positions
Approximately 30% 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
Israel
Philippines
Explore: Emerging Market Commentary
India: India’s BSE Sensex recently reached its highest level since December 17, 2024. This increase was fueled by optimism regarding easing global trade tensions and the potential for a U.S.-India trade deal, supported by robust foreign fund inflows and record GST collections in April. However, gains were limited by ongoing border tensions with Pakistan and concerns related to the Supreme Court’s rejection of Bhushan Power & Steel’s resolution plan. The Reserve Bank of India (RBI) reduced its key repo rate by 25 basis points to 6%, marking two consecutive cuts and the lowest borrowing costs since November 2022. GDP growth forecasts were slightly adjusted downwards to 6.5%, while inflation estimates were revised to 4%, remaining within the RBI’s target range. Additionally, the HSBC India Manufacturing PMI rose to 58.2, and the Services PMI increased to 59.1, indicating continued expansion in both sectors.
Taiwan: Over the past month, the Taiwan stock market has shown encouraging signs of recovery. The Taiwan Stock Exchange (Taiex) surpassed the 20,000-point threshold for the first time since the imposition of high tariffs by the United States in early April 2025, primarily spurred by a significant rally in the U.S. technology sector. A key contributor to this uptick was Taiwan Semiconductor Manufacturing Company (TSMC), whose shares climbed notably, achieving a record daily increase of 9.2% alongside a remarkable 60% rise in quarterly profits driven by strong demand for AI chips. The broader tech sector also performed well, with notable gains from companies like RiTdisplay Corp (up 10%) and Ying Han Technology (up 9.95%). In addition, the recent improvement in sentiment regarding U.S.-China trade relations, marked by China’s willingness to engage in dialogue, contributed to the increase in Taiwan’s index and alleviated concerns about tariffs. Over three consecutive trading days, the Taiex racked up over 750 points, reflecting a total gain of 3.7%, led by the financial, technology, and plastics sectors. Overall, these factors combined indicate a positive shift for Taiwan’s stock market amidst a volatile climate.
Hong Kong: Hong Kong’s YTD increase was underpinned by strong investor sentiment and heightened trading activity, evidenced by the Hong Kong Exchanges and Clearing Ltd reporting a 37% increase in first-quarter profits, achieving its highest quarterly result to date. The Hang Seng Tech Index, which tracks leading technology companies, surged over the first four months of 2025, driven by major players like JD.com and Alibaba. Additionally, easing U.S.-China trade tensions, highlighted by a communication between President Xi Jinping and President-elect Donald Trump, further bolstered market confidence. Strong performance across various sectors, including technology and healthcare, highlighted the market’s resilience. This blend of domestic strength and improved external trade dynamics signals a robust landscape for Hong Kong’s stock market, despite ongoing trade uncertainties.
Israel: The TA-125 equity index is approaching 10-year highs. On April 7, the Bank of Israel decided to maintain its key interest rate at 4.5% for the tenth consecutive meeting, aligning with market expectations. This decision reflects the central bank’s commitment to stabilizing markets and supporting economic activity amid the renewed Israel-Hamas conflict and uncertainties from U.S. tariff policies. Domestic inflation eased to 3.4% in February, down from 3.8% in January, although it remains above the target range. The bank forecasts inflation will gradually moderate to 2.6% in 2025 and 2.2% in 2026, while GDP growth is now projected at 3.5% for 2025 and 4% for 2026. Over the past month, several positive developments have bolstered the Israel stock market. The TA-125 index rose approximately 5.02% since the start of 2025. Investment in the technology sector remained strong, attracting over $12 billion in private funding. The banking sector also contributed to market stability. Furthermore, the Israeli shekel was stable, while the Tel Aviv Stock Exchange plans to adopt a Monday-Friday trading week starting in 2026, enhancing appeal for international investors.
Philippines: In April, the Central Bank of the Philippines reduced its benchmark interest rate by 25 basis points to 5.5%, responding to easing inflation, which dropped to 1.8% year-on-year in March—the slowest rate since May 2020 and below the central bank’s target. This rate cut was intended to bolster the economy amid rising global trade tensions. In the stock market, the Philippine Stock Exchange Index (PSEi) surpassed the 6,400 mark for the first time since January. Positive developments included significant foreign investment inflows, with net buying of over PHP 986.3 million on May 1, contributing to a total market turnover of PHP 8.3 billion. Fitch Ratings affirmed the Philippines’ investment-grade rating of “BBB” with a stable outlook. Furthermore, strong performances in real estate and an anticipated IPO pipeline of PHP 140-150 billion indicate continued market growth, despite existing risks.
Catastrophic Stop Model
The Catastrophic Stop model combines time-tested, objective indicators designed to identify high-risk periods for the equity market. The model entered May recommending a fully invested equity allocation relative to the benchmark.
Breadth Thrust and Oversold Mean Reversion indicators have recently provided bullish signals, along with supportive measures of Investor Sentiment, A/D line trends, Volume-adjusted Demand, Economic Activity indicators, and improving High-yield Bond Breadth.
The weight of the evidence suggests that the recent decline is not expected to extend into a significant downtrend. Of course, if our model flips negative (below 40% for two consecutive days), signaling more substantial problems, we will raise cash immediately.
The Day Hagan Daily Market Sentiment Composite (Figure 9, below) has recently moved into the neutral zone from levels denoting excessive pessimism. If the composite moves above 70 and reverses, it would be considered a headwind for stocks. Currently, the trend is your friend.
Figure 9: S&P 500 Index vs. Day Hagan Daily Market Sentiment Composite
Lastly, we are pleased to announce that our collaboration with 3Fourteen Research has reached a milestone. We have been working with their strategists and data scientists for over a year to take the lead in modeling our Smart Sector and Global Macro strategies. With the May 1st rebalance, we have fully incorporated their research into our allocations. Their support has been instrumental in enhancing our research, developing essential indicators, and maintaining our existing indicators and investment models. 3Fourteen Research is headed by Warren Pies (Co-founder and Strategist) and Fernando Vidal (Co-founder and Chief Data Scientist), both of whom were instrumental in developing major models and indicators at Ned Davis Research. Warren Pies is a frequent guest on CNBC. Gary Sarkissian (Senior Research Analyst), CFA, also formerly of Ned Davis Research, created and maintained NDR’s U.S. sector ranking model and developed numerous proprietary tools and studies for the firm’s institutional strategy. 3Fourteen provides a team of experienced analysts, data scientists, and developers whose expertise includes machine learning, time series analysis, and application development.
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
1000 S. Tamiami Trl
Sarasota, FL 34236
Toll Free: (800) 594-7930
Office Phone: (941) 330-1702
Website: https://dayhagan.com or https://dhfunds.com
© 2025 Day Hagan Asset Management
Charts courtesy Ned Davis Research (NDR). © Copyright 2025 NDR, Inc. Further distribution is prohibited without prior permission. All Rights Reserved. See NDR Disclaimer at www.ndr.com/copyright.html. For data vendor disclaimers, refer to www.ndr.com/vendorinfo.
Day Hagan 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.
© 2025 Day Hagan Asset Management
