"The more favourable development of the capital market seismograph in the last few weeks has almost reversed itself in the last few days", informs Oliver Schlick, Managing Director of Secaro GmbH, "the probability in the direction of positive, calm markets receded, the negative turbulence probability rose again at the expense of the other two probabilities".

As you know, the seismograph combines various economic variables - early economic indicators, interest rate developments or even price fluctuations on the stock markets. From these, the probabilities for three market states in the next month are distilled. Green stands for the expectation of a calm, positive market. If green dominates, investors should invest in shares. Yellow indicates the probability of a turbulent positive market - investing, but with a sense of proportion. And red indicates the probability of a turbulent-negative market. Then abstinence from equity investments is called for

"Currently, the probability landscape is again reinforcing the defensive recommendation of the seismograph regarding equity allocation," concludes Schlick, who translates the results of the capital market seismograph into an allocation proposal. As a result, the recent slight increase in positions in the equity market is being revised: "We have recently felt our way back into the equity market very cautiously. Now we are pulling the toe - so to speak - back again."

The consequence for investors:

The economic traffic light of the private wealth stock market indicator is on red, but the Dax - in terms of our fair value calculation - is still undervalued. Therefore, the private wealth stock market indicator currently provides for a corridor for the recommended equity quota between 45 and 75 percent of the individually planned equity share.
Within this range, we are guided by the results of the capital market seismograph. After the results of the seismograph had turned out somewhat more positive a week ago, the equity ratio suggested by the private-wealth stock market indicator had increased from 55 to 60 percent of the individually intended equity share. Currently, the stock market indicator is taking this step back again. The recommended share quota has dropped again to 55 percent. 45 percent of the individual's equity allocation is in cash. 

Yours sincerely,

Klaus Meitinger

Note: Despite careful selection of sources, no liability can be accepted for the accuracy of the content. The information provided in private wealth is for informational purposes and is not an invitation to buy or sell securities.