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The market appears to have started a recovery. All of the major indexes are up over 5% from their bottom. However, it remains to be seen if this market recovery is sustainable.
The Kinetic Financial model portfolios are currently 25% to 35% in cash to protect us from an extended bear market. As the market recovers, we will incrementally put this cash back into the market by investing in funds that held up well during the most recent market downturn and at the same time have demonstrated good performance.
It is during down markets that good funds reveal themselves. We look for funds that have lost the least amount of money during the most recent market downturn but have still demonstrated high upside potential. If the same issues continue to plague the market in the near future, we'll be better protected by investing in funds that have demonstrated less risk in the most recent downturn.
Be on the lookout for our new fund recommendations as the market recovers. We never make big bets on any one fund. Instead, we incrementally build up positions in funds that continue to demonstrate strong Risk/Reward behavior over time.
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posted by Ramesh Agarwal & Team @
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