SHORT & SWEET
Leader Capital believes that the markets will correct 15% this summer. Reiterates positive outlook on commodities.
July 11, 2016
We want to reiterate our view from our April 2016 Webinar that the markets will correct 15-20% this summer. We are seeing the beginning stages of that move post Brexit. The equity markets currently look like 1990/1991 while commodities look like 2008/2009. We believe this correction will be fast and sharp, retesting August 2015 and February 2016 lows, as it marks the end of the current bear market that began June of 2015 and that within 60 to 90 days, the markets will begin moving higher as we enter into a new bull market.
With each market correction comes opportunity. The portfolios are currently well positioned in this market environment with ~35% in cash waiting to be deployed. We will look to deploy this cash on weakness. With the cash deployment on dips, we believe we can significantly increase our overall current yield while maintaining credit quality. In summary, we want to highlight the following from our webinar: 1) Equity markets should correct this summer 2) Positive outlook on commodities 3) 12 Trillion Dollar Haircut (Currencies move lower).
Investments in debt securities typically decrease in value when interest rates rise. The risk is actually greater for longer-term debt securities. Investment by the fund in lower-rated and nonrated securities presents a greater risk of loss of principle and interest than higher-rated securities. The fund is exposed to credit risk where lower-rated securities have a higher risk of defaulting on obligations. Investments in foreign securities involve greater volatility and political, economic and currency risks. They may also have different accounting methods. Investments in asset-backed and mortgage-backed securities include additional risks that investors should be aware of such as credit risk, prepayment risk, possible illiquidity and default, as well as increased susceptibility to adverse economic developments. Investors should consider the investment objective, risks, charges and expenses of the Fund carefully before investing. The Prospectus contains this and other important information about the Fund. For a current Prospectus, call 800-269-8810 or go to www.leadercapital.com
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The Funds are distributed by Foreside Distribution Services, LP.