John Kosar, Founder & Chief Market Strategist, Asbury Research, discusses the firm’s market data driven models and how advisors can leverage them to make strategic investment decisions.
Asbury Research uses their own proprietary models to provide clients with data driven, actionable market intelligence and investment ideas. They use five data driven models, all of which serve a unique purpose and provide forward-looking insight into the market.
The Correction Protection Model (CPM) was designed to provide protection for an investor’s assets during market declines, to eliminate large drawdowns, and to reduce volatility in portfolios by moving out of the market during adverse conditions. The CPM is a very valuable defensive model that provides a binary assessment of whether an investor should be risk on, meaning aggressive and fully invested, or risk off, meaning defensive and protective of capital.
The Asbury 6 Model (A6) was designed to provide information to investors about the health of the market, which can then be used for tactical risk management. The Asbury 6 Model serves as a “lie detector for the market,” says Kosar. The A6 Model checks the health of the market in a way that isn’t tracked by the S&P 500, providing a “under the hood” check up on market conditions.
The Cross Asset Investing Model (CARP) was designed to track where money is going, and it therefore makes clear what asset classes are outperforming others. For instance, the model shows that value has been significantly outperforming growth by since early January and that low volatility has been significantly outperforming high beta.
The Sector Asset Flows Model (SEAF) follows money in U.S. market sectors to help investors choose what sector to invest in. “Even when the market’s down, as it’s been for the past two months, it’s showing you the places where you can actually get outperformance, if not overall performance,” says Kosar.
Asbury Research does one on one conferences with their clients, focusing heavily on getting to know them and their goals. Asbury Research also teaches their clients how to use their models themselves. “We’re able to show them how to use these tools in a way that’ll help them to do what they’re already going for their clients and do it better,” says Kosar.
Asbury Research was founded by John Kosar in 2005. Asbury Research helps both professional and individual investors manage downside risk while improving market performance. They produce macro analysis and follow market data to give strategic investment advice to clients.
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