Tuesday, July 28, 2009

Hussman: Biting a Bullet

One of the funds I utilize is the Hussman Strategic Growth fund, managed by John Hussman, PH.D. His fund is fully hedged and this weeks commentary explains why. Here is the important part:

"That said, I can only describe our investment stance here as “uncomfortably defensive.” That is, the measures that have guided the performance of the Strategic Growth Fund over time are still holding to a defensive stance, which is admittedly uncomfortable with the market pressing strenuous but persistent overbought levels. It's a lot like watching people scale across a tenuously secured rope bridge and get a nice meal at the center. You'd like to climb across and join them, but you know that too many things aren't right with the bridge, and it's not clear that the people who are eating will ultimately survive."

Scott Dauenhauer CFP, MSFP, AIF