Investment Newsletter: Stock Market & Investment Strategies
HELPING YOU NAVIGATE A TOUGH INVESTMENT ENVIRONMENT
DECISION MOOSE-- Global Investment Markets This Week
Figuring the Fed
Market Thumbnail: WEEK through 11/1/25:
Okay, we got the expected October Fed rate cut this week, but we also heard that the similarly anticipated December rate cut is by no means a “foregone conclusion”. As a result, instead of another risk-on response, the markets ended the week mixed and confused. (See Moospeak.) US small caps which have the most to lose from high rates fared worse than large caps. US long bond yields went up in sympathy and bond prices fell. The 10-yr yield rose 10 bps to 4.10%, and the cash yield dipped to 3.72% steepening the yield curve. Higher US bond yields helped the Dollar rally, but the stronger Dollar hurt gold, oil, and oil. Offshore, the stronger Dollar hurt Europe, but Japan and Asia-Pacific benefited from Trump’s overseas attention, along with their best customer. No change in the models.
THE FREE GLOBAL INDEX MODEL-- SUMMARY 11/1/25
Index Model Comes Back to Earth
THIS WEEK: Holding #1 Gold (GLD) since 8/28/25 @313.07 via buy-stop after switching out of #2 EFA.
The Index Model had a record run in 2025, a once in a lifetime event. Two weeks ago it posted a 100%+ annual year-to-date gain, most of it from gold. But gold was severely overbought and its time was limited. It has since come back to earth, but 80% would still be a one-year record return if the year ended today. Gold has been buoyed by the prospect of three Fed rate cuts since August. We've had two but the third was called into question by the Fed chair this week and that extended selling in gold. The model will switch out of gold when the numbers tell it to, but we're free to exit anytime. It is a lot easier to be patient when one is playing with house money. Emerging markets and US small caps are attractive options, but rate cuts are key to their attractiveness as well. Recommendation: If you're in GLD expect support at the 50-day SMA or 20-day stop-loss. If that doesn't hold, the model will exit.
PERFORMANCE YEAR-TO-DATE:
INDEX MOOSE +80%
AOA (Aggressive Growth) +17%
SPY BENCHMARK +16%
AOM (Moderate Growth) +10%
THIS YEAR: Strong gold and weak US stocks put the Index model into gold from January through April helping us to avoid the March-April V-bottom in equities caused by the tariff announcement. Exiting gold, which had flattened by mid-May, for International stocks set up a period of vacillation between gold and international stocks that ended with a switch to gold in late August, ahead of the first Fed rate cut on 9/18. With rate cuts, trillions in US federal deficit spending, and US tariffs likely to continue through December, foreign equities and hard assets should have solid future prospects.
THE FREE GLOBAL INDEX MODEL has been around for 34-years. It is a momentum-based market timing model the latest version of which compares the relative strength of ETFs representing US stocks (SPY, IWM) and international stocks (EFA, EEM)) along with US Treasuries (SHY, EDV) and Gold (GLD) in order to pick the single best asset class in which to invest your money. Rankings provide the basis for the Moosecalls global financial newsletter, and have in the past been a solid predictive tool. They provide a general direction (stocks, bonds, precious metals, cash) for allocating investment assets. A daily signal, it is provided here for free once a week as a guideline only.