Alpha Power Investing Newsletter

April 5, 2017

The Power Zone "Home Stretch"

For the Alpha Mid-Cap Power Index and The Formula strategies, the period that we refer to as the "Power Zone" extends through the end of May 2017. In addition, we are presently in a post-election year. As it turns out, this has typically been a favorable combination for stock investors.
Between the end of November and the end of May, both the Alpha Mid-Cap Power Index and The Formula strategies hold the S&P MidCap 400 Index during the post-election year. Figure 1 displays the performance for this index during the combined months of April and May during the last nine "post-election" years.
As you can see in Figure 1, while the April/May period performed better in some post-election years than in others, the key point is that each April/May post-election year period showed a gain. This of course does NOT guarantee smooth sailing for the stock market between now and the end of May 2017. It does, however, give us reason to ignore the turbulent headlines that swirl around regarding the "outlook" for the market and the economy on a daily basis and to simply focus on following our objective strategies.
To put this performance into another perspective, Figure 2 compares the S&P MidCap 400 Index April/May performance during post-election years to that of the S&P 500 Index and the Bloomberg Barclays Intermediate-Term Treasury Index.
As you can see in Figure 2 the average gain for the S&P MidCap 400 Index was +7.9% versus +6.2% for the S&P 500 Index and +1.3% for the Bloomberg Barclays Intermediate-Term Treasury Index.
Figure 3 displays the cumulative gain for each index displayed in Figure 2 during the April/May post-election year period since 1981.
As mentioned earlier, the results presented here are not intended to imply that the stock market in general - nor the S&P MidCap 400 Index in particular - is certain to register a net gain during the April/May 2017 time period. Still, if history proves to be an accurate guide, then the next two months will hopefully be a favorable period for stock market investors, and investors may be wise to ignore the noise associated with the market on a day-to-day basis.
To learn more about our strategies, go to the Strategies and Performance page of our website at to read the brochures and fact sheets.

Jay Kaeppel
Vice President and Director of Research
Alpha Investment Management, Inc.

Disclosures: Past performance is not a guarantee of future performance. Indexes are not investment vehicles. The returns illustrated above are not returns of any Alpha strategy and do not include management fees or the cost of funds, trading, or other expenses. To see the impact of these costs, please refer to the net of fees and expenses performance data for specific Alpha strategies. The illustrations above are designed to quantify the effect of certain time periods on a representative market index.

Alpha Investment Management, Inc. is a SEC registered investment advisor. Such registration does not imply a certain skill or training and no inference to the contrary should be made. The information and opinions expressed in this document are for informational purposes only. Any recommendation or opinion made in this document may not be suitable for all investors. The information contained herein does not constitute and should not be construed as investment advice, an offering of investment advisory services, or an offer to sell or a solicitation to buy any security.

© 2017 Alpha Investment Management, Inc.

Alpha Power Investing Newsletter Archives