ETF Portfolio Update

July 17, 2023

131

Author

Wiko Steyn

Monthly ETF Contribution

If you have been reading our articles for a while you can probably guess what comes next. Inflation numbers came in red hot AGAIN. We apologise for the broken record player. We wish there was something else to report, but these numbers matter because it drives market sentiment, and sentiment is one of the primary drivers of stock prices.

Yet, something strange occurred yesterday, in pre-market hours indexes like the Nasdaq and S&P500 were up by roughly 1%, 30 minutes before the market opened, Core CPI hit another 40-year record high and the market crashed by 3%. So, before the market opened we already saw a 4% swing. What happened next, was the really staggering part, the market rallied almost 6% from its lows on basically no news. If you are new to this, we would like to inform you that this is not normal.

What is going on? The market was clearly oversold and we saw some short covering which created a relief rally. What does this mean for the future? We can promise you, anybody claiming they can predict the next market move, won't be giving you their advice on social media or some subscription service. They will be billionaires and not in any need of your follow, like or retweet.

Can this signal a market bottom? Possibly, but the market is in dire need of some good news and right now we can't see the light at the end of the tunnel yet. Will it turn around eventually? Well, history is in our favour and every bear market eventually ended and made new highs but remember there are no guarantees.

Earnings season is starting again and this will give us some insight into the economy. Unfortunately, this is usually a very volatile period and we are already in a volatile year. For long-term investors, we strongly advise you to not let daily price movements influence your emotional well-being.

Portfolio Update Summary

We have made our monthly allocations to all ten ETFs in this portfolio.

Disclosure

This is not financial advice and only the opinions of the author. The $28K in the ETF portfolio is not real money and is only a demonstration of a typical portfolio.