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A quick note before I head off to McCormick Place:

Over the past 2 weeks, our cash levels have risen appreciably and equity exposure is now below 50%. A variety of factors, most of which were specific to individual holdings — not an overall equity call — led to this shift.

This was not a market call; however, given the ambiguity of the economic outlook versus the strength of earnings, we are fairly comfortable with high cash and bond levels. (Our tactical portfolio did go full defensive on May 1, but that is driven by quant metrics and is automatic).

Rather than forecast the end of the world, we are making a list of potential buys. Many of the names and sectors I am interested in are in a no man’s land in terms of risk/reward: They are significantly above an ideal entry, but far below what qualifies as a breakout.

Thus, I’d rather buy them when they are either a) cheaper (with more sentiment negatives) or b) higher (where they have confirmed a breakout).

Here, price direction is a bit hazy. I am happy to wait for better entries

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