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V2 Model February 6, 2021 Update

V2 Model February 6, 2021 Update

February 06, 2021

Good morning!

Welcome new Members.

Here is V2 performance versus our benchmark of SPY.

This week:

V2 +17.14%

SPY +4.77%

This year:

V2 +21.99%

SPY +3.7%

The major market indexes ended this week in the green with all averages solidly higher. The Russell 2000 Small Cap Index, which has been a bright spot in recent months, continues to lead all major markets with a more than 7% return for the week. (Our holding of TNA was up over 24%.) Both the MSCI EAFE and Emerging Markets (EM) international markets had positive weeks as well.

V2 had a good week. Although, what a difference week makes. The Model (last weekend) looked like it was going to cross and have us reallocate to cash and short on Monday. Instead, the markets rallied and we added to our positions on Tuesday.

Attached are V2 Ratio #1 charts for our holdings. You can see the dip and rebound this week. As such we remain long.

I have also enclosed a daily chart of the CPCE index. It is one of the 49 ratios in the V2 model. The Put/Call Ratio is an indicator that shows put volume relative to call volume. Put options are used to hedge against market weakness or bet on a decline. Call options are used to hedge against market strength or bet on an advance. You can see (red circle) the three times in the past year the ratio crossed to hedge risk-off areas. You can also see (green circle) this week it spiked but did not cross. We do not forecast from this. We use it to confirm positions.

This week I was asked my opinion of Cathy Woods and ARK Investment ETFs. Here is what I said:

Her bets on innovation are smart and correct.
Her performance is outstanding.
We have owned (and continue to own) ARKK and ARKG for a few years now.
$10,000 invested in ARKK from 2016 to this weekend would be worth $42,818. Awesome. $10,000 invested following V2 over the same time period would be worth $58,353. Better.

Our plan this week? We will stay flexible and keep an open mind to changes in either direction. We will follow the math.

V2 currently holds:

TNA (56%)

TQQQ (44%)

The V2 Model has performed exactly as expected.

Distance=Victory

Chris

ps. Please invite others to join The Vig Company. And also, please, do not share the V2 Model allocations with others. We keep the monthly charges low for all as everyone pays their own way. Our information should not be copied or shared in any form.

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