We use the ETF HYG as a proxy for market liquidity. It is one of the leading indicators we use to get a sense for market direction.

See the weekly chart above. Notice the arrow. Momentum is trending down and closed at .006 on Friday. Over the past 10 years, this has only crossed to negative 4 times. Each time the market moved lower - 100% of the time. The average downturn from that point was 8.3%. Coincidence or not we are roughly 9% away from 4000 on the SP500. That level might be a common area of market support.

This is not a prediction, it is a perspective that we need to pay attention to possible outcomes in either direction.

If you would like to see our holdings, allocation, and experience how we manage our portfolio please sign up for our V2 Newsletter. Just hit the button below.

Distance=Victory

Chris

The V2 Model has gained an impressive 1,454%% from 2016 through 2021.

6X the performance of SP500 (2016-2021)

+83.27% 3-Year Annualized Returns (2019-2021)

+69.22% 5-Year Annualized Returns (2017-2021)

V2 Newsletter performance rank compared to all ETFs:

Top 10% 2021 (#243 out of 2867)

Top 1% 3-Year (#9 out of 1896)

Top 1% 5-Year (#4 out of 1896)

Market Data From Morningstar and Etrade.

We do not anticipate what is going to happen. We allocate based on where things are. We do not forecast, we follow the math and work to get on the right side of the next extended trend.

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V2 is a proprietary investment Model the results of which we make available in our newsletter. We give our holdings, changes before they occur, our allocations, and performance on an ongoing basis. You can discover more about the Model, our performance, and how it works by checking out our website.

We have researched and developed a pool of common and popular ETFs. We will select which ETFs to invest in based on market conditions and our short-term, medium-term, and long-term trends. We will also model asset class ratio behavior for our decision-making process. Leverage will be used when appropriate and we will short the market in a downturn. If no investments meet our rules, we will go to cash. We will change holdings at any time during the month.

The investment picks may be in large-cap growth, treasuries, leverage, derivatives. We may short the market or go to cash. Holdings may include SPXU, SDS, SH, SPY, SSO, UPRO, TLT, AGG, TQQQ, SQQQ, or CASH at any time.

Chris Vig is president of The Vig Company and is an investor, artist, author, business consultant and former CEO living in Monona, WI. This article is for entertainment purposes only. We may own, buy, or sell any security listed here at any time. Do your own diligence when investing your hard-earned cash. Follow The Vig Company on Facebook.

You can learn more about the model, its holdings, and how it works by going through each link on our website. The V2 newsletter is available for $15 a month. And of course, you can unsubscribe at any time.

THE VIG COMPANY LLC INFORMATION AND NEWSLETTERS ARE NOT A RECOMMENDATION TO BUY OR SELL SECURITIES. WE ARE SIMPLY LISTING THE RESULTS OF OUR MODEL. WE MAY BUY, HOLD, OR SELL ANY SECURITY LISTED IN OUR INFORMATION AT ANY TIME. WE ARE NOT REGISTERED INVESTMENT ADVISORS AND HAVE NO UNDERSTANDING OF YOUR PERSONAL FINANCIAL SITUATION, RISK TOLERANCES, OR INVESTING OBJECTIVES. ANY INVESTMENT DECISIONS YOU MAKE ARE YOUR OWN. PLEASE DO YOUR OWN DILIGENCE WHEN INVESTING YOUR HARD-EARNED MONEY.

Is Market Liquidity A Problem?