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Annualised Returns - The Money Pouch

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Annualised Returns - The Money Pouch Performance

Strategy  Since Launch 1-Month 3-Month 1-Year
Conservative 5.10 3.54 1.18 9.51
Balanced -3.82 -3.30 -6.36 7.96
Adventurous 14.26 7.87 4.49 16.21

So, after a choppy year with Trump trying to derail international trade with the US-China trade war and the US government shut down. the stock market still managed to battle through and our strategies have been roughly on target.

Our balanced strategy has underperformed, but we have tweaked all the strategies which will take effect in next month's rebalance, adding the ability to hold the bull USD ETF, so we can go to the greenback if necessary rather than treasuries or gold as a hedge. We have changed a couple of other very minor things, but the strategies remain similar. We are just performing small tweaks to add to performance in light of the current economic fundamentals.

The main economy and the stock market don't run hand in hand. However, usually the stock market is a leading indicator of the economy. You can read about the Granger causal relationship here. You saw some jitters at the end of 2018 and it could be an indicator of what is to follow. Typically, equities do better from October-May and then bonds & treasuries usually outperform. As Quantative Tightening has arrived, my guess is that this will be the case this year, although the Federal Reserve seems to have temporarily backed off from raising interest rates, which is good for the economy and stocks.

The State of the Global Economy

The statistics for the global economy don't look great thanks to the US-China trade war. This seems to be more of a move to stop China expanding quickly rather than anything else. So, the U.S. government is trying to choke China economically rather than militarily.

The trade war has lead to the Purchasing Managers Index (PMI) to drop in countries around the world.

Trump was trying to increase US exports and reduce Chinese imports, but the opposite is happening and the deficit swelled in December as you can see in the table below.

Released On 2/27/2019 8:30:00 AM For Dec, 2018



Consensus Range



$-73.7 B

$-74.5 B to $-73.0 B

$-79.5 B

Exports % change


-2.8 %

Imports % change


2.4 %

Economic Headlines

Global Composite PMI Chart


Global PMI Activity

It doesn't look good for Japan, South Korea, Taiwan, Malaysia, Germany, Italy, Poland, Czech Republic, Turkey & Colombia.



car sales risk

Hong Kong Growth Just Went into Negative Territory


hk gdp growth

Doesn't Look Good in the U.S. Either

us pmi

How to Trade These Markets

The best way to do this is with a rigorous investment trading strategy that assesses risk levels and can hedge your exposure to equities through diversification to safer assets such as treasuries, gold or cash.

You can read more about our investment strategies here.

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