Nothing excites traders or investors more than the market. And, this past week was certainly confounding… but in a good way. We discussed previously that low-priced stocks are more likely to outperform the market during down days because liquidity tends not to disappear first at the margins. So, it was surprising that our portfolio has been steadily gaining while the S&P 500 (SPY) has encountered significant selling this week. In this week’s commentary, I will discuss why this is happening and what it means. Read on below to find out more….Over the past week, the S&P 500 is down by 3.5%. What’s interesting is that the is down by 2.3% and the microcaps index (IWM) is down even less – 1.6%. Our portfolio was 2.1% higher over the week.

What is the reason for this? I believe we are experiencing selling pressure at the Fed, signaling that there is a potential taper. This could be happening either at the current meeting or next. This has led to a strong in rate which is pressing many growth and income stock.

This weakness, however, is compensated by an improving economy especially because coronavirus incidences continue to plummet.

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