The moderate portfolio trailed its global 60/40 benchmark in July, driven by pullbacks in U.S. small-caps and commodities. Year-to-date it is outperforming its peer range. We trimmed some holdings to fund additions to broad U.S. equities on the pullback.

In aggressive strategies, we trimmed some extreme winners to make room for emerging themes. We also rightsized our Asian and European equities exposure.

Despite short-term pullbacks, our positioning across the portfolio suite is consistent with a risk-on regime and aligned with expected returns.

This is where long-term discipline matters. Our regime filter has held positive for 47 consecutive months, with each market pullback and roughly five bear markets contained at the 40-week moving average since the financial crisis recovery.

Shifting regimes are rare, but the key to investing is avoiding deep and prolonged drawdowns.

Rolling returns say the same thing: 10-year holding windows finished negative just 10% of the time, and 20-year windows 3.5% of the time.

So, you can afford to be aggressive with a 20-year holding period, while a 10-year holding period requires a more moderate strategy, especially given stretched valuations.

Thanks to our diligent team, partners, and clients.

-Damanick Dantes, CMT

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The global risk rally is spreading. For years, a handful of big U.S. tech stocks did most of the heavy lifting. While the tech theme is still dominant, especially in EM Asia, markets that spent a decade in the shadows like smaller U.S. companies and parts of Europe are starting to catch up. That’s healthy, but it comes with a few catches worth knowing about.

Here are some key takeaways:

• Don’t abandon what’s working, but don’t pile on either. Large U.S. growth stocks still lead, so we prefer trimming a little from the most stretched areas and redirecting proceeds toward markets that are just waking up. Don’t chase what’s already run the furthest.

• Where you invest matters, and so does the currency. Some of the world’s hottest stock markets, like South Korea, sit on top of the weakest currencies. So, local investors made huge gains this year, while U.S. investors gave back a big slice when converting those wins back into dollars. In parts of Asia, protecting against that currency drag is important, although we expect these large currency moves to subside over time.

• The most crowded trades of the past decade are the most tired. Stocks versus bonds, gold, silver: all sit at their ten-year extremes, and their momentum is fading. It’s a reminder to rebalance back to target weights instead of letting extreme winners quietly take over your portfolio.

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Have a great weekend.

Damanick Dantes, CMT

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Last month’s mid-year review produced more changes than a typical month. We had country exits, sector rotations, and trend following allocations. Those positions need time to work, so we are not adding new changes on top of fresh ones.

Our portfolios experienced mild pullbacks in June, largely driven by declining commodity prices, particularly in metals. We expect this to stabilize. Uptrends remain technically intact, and prices have pulled back to earlier breakout levels. We’ll explore this from a long-term relative price and valuation standpoint in the next post.

Despite near-term softness, every portfolio in our suite remains on track relative to its peer group and consistent with long-term annualized return targets. We aim to exceed investment goals over a full market cycle. And each portfolio is calibrated to individual client risk profiles.

For defense, we lean on diversification since our strategies are moderate-to-aggressive rather than conservative. As such, the use of commodities, trend following, and a longstanding fixed income underweight helps to address rising interest rate and inflation risks.

Thanks to our diligent team, partners, and clients. Please reach out to learn more about our process.

We enjoyed our time in Chicago last month, and will head to East Hampton, NY to kick off the summer! Give us a shout.

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All the best,

Damanick Dantes, CMT

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This round we adjusted some country-specific stock positions that were not pulling their weight, leaned a little more into U.S. stocks, and sharpened our commodity exposure in industrial metals. We also introduced a new U.S. stock-picking strategy based on fundamental quality and price momentum.

We also lightened up on government bonds and leaned on our trend-following “hedge” sleeve instead. Trend-following strategies can go long and short, and can profit when bonds fall and can ride trends in stocks, commodities, and currencies.

Our aggressive portfolios have maintained their lead versus respective benchmarks year-to-date. These include our global absolute strategy, bitcoin/gold rotation strategy, and the new U.S. quality momentum strategy. Each strategy is scaled into an aggressive model for clients that require steady growth returns.

The moderate portfolio serves as the core of our portfolio suite, benchmarked against the conventional global 60% equity/40% bond portfolio. It has a consistent track record of outperformance while taking on a proportional amount of risk versus the benchmark. We include commodities and hedge sleeves to provide up capture, especially when bonds are challenged.

Clients seeking more stability and less turnover can also hold our dynamic all-weather strategy which is a balanced portfolio that adjusts based on our trend and momentum framework.

Thank you to our diligent team, partners, and clients. I’m proud of our thoughtful approach to portfolio construction.

Please reach out to learn more about our process — we will be in Chicago in two weeks, New York, and potentially London in a few months. Give us a shout if you’re around!

Subscribe for full details and ongoing insight. To become a private client (individuals, families, OCIO partnerships), email us at damanick@dantesoutlook.com

All the best,

Damanick Dantes, CMT

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Here’s the catch: All-time highs provide a reliable estimate of an ordinary range of outcomes. Those outcomes are sometimes matched with concentrated equity exposure or high starting valuations. This is why we include various assets that may experience accelerated moves at various starting points.

Concentrated equity positions look great on the way up, but investors may find it uncomfortable to sit through inevitable drawdowns. The S&P 500 lost more than half its value during the 2008-2009 financial crisis and took twelve years to fully recover on a real-return basis. A lot can happen in an investor’s life over twelve years–let that sink in.

For a client drawing income, supporting a family, or funding your institution’s spending policy, that path matters just as much as the destination.

We’re not aiming to win big every time because no signal works in every environment. But we can capture sustained trends. Our framework combines trend, momentum, and dispersion to participate in persistent moves, rotate toward strength, and rebalance toward neglected assets that show improving returns relative to our winners.

We apply that same logic to investable portfolios across all assets. We’re personally invested, and we advise private clients from families to institutions, and sub-advisory relationships via our OCIO services. These relationships are worldwide and built on a decade of trust.

Finally, academic research underpins all that we do. It shows that combining trend and value/momentum (VME) across asset classes produces a smoother profile with materially lower drawdowns and higher risk-adjusted returns than concentrated equity exposure alone.

We ran the numbers below.

Damanick Dantes, CMT

damanick@dantesoutlook.com

Read the PDF memo here

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The moderate portfolio provides a steady equity core to the aggressive portfolio’s 20% bitcoin/gold and 20% absolute strategy mix. Exposure to semiconductors, crypto, and other themes boosted performance across satellite portfolios. While metals detracted from relative performance, all strategies remain well ahead of respective benchmarks YTD.

To manage interest rate risk, we added hedged sleeves. With rising stock/bond correlations reducing the cushion provided by fixed income, we are utilizing managed futures. These strategies may profit from falling bond prices through short positions and benefit from evolving trends in equities, commodities, and currencies, allowing for diversification beyond the benchmark.

The chart below demonstrates how inflationary pressures typically coincide with elevated stock/bond correlations.

The full portfolio report with performance breakdown and updated positioning is available to paying subscribers and clients.

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The latest data point to rising dispersion and relative-value opportunities, consistent with a late-cycle global rotation. This typically occurs when prior market leaders begin to weaken versus broader indices, creating openings for selective positioning over broad beta exposure.

Current signals favor tilts toward non-U.S. equities, particularly emerging markets, while broad commodities offer relative value versus both bonds and equities, with diversified metals and agriculture showing improving signals. We also see supportive momentum across cyclical currencies, even as the broad dollar index has neutralized.

You’ll notice a new layout of the report as our team builds new tools to give you the best research to guide your investment decisions — the same findings that guide our portfolios.

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Despite a challenging month for risk assets, the portfolio maintained its lead versus global moderate allocation peers YTD, largely benefitting from its exposure to non-U.S. equities. Trend following peers experienced volatility in March, although YTD gains remain strong.

The correction in metals and equities weighed on aggressive portfolios in March, while our moderate and all-weather strategies were more stable. All portfolios outperformed their respective benchmarks YTD. Positive selection effects were driven by our tilts toward specific regions, sectors, and styles.

Additionally, long/short and cross-asset exposures aim to minimize downside risk and expand the opportunity set for up capture. Historically, this balanced approach provided a smoother return profile versus traditional portfolios.

The full portfolio report with new positions is available to subscribers below.

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Is the sell-off overdone, and could this present a buying opportunity?

In our latest special report, The Software Reset, we unpack the full picture:

→ Where software sits technically after the selloff, and the key support zone to watch

→ The structural divergence between software and the rest of tech — and what this decoupling means for investors

→ How software’s valuation stacks up against the S&P 500 and semiconductors, with current valuation compression at levels we've never seen before

→ Return dispersion within the sector, why selectivity matters within the software index, and a single-stock idea showing strength in a washed-out tape

The full report is available for premium subscribers.

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Also, Damanick Dantes appeared live on CNBC International and CNBC Arabia to discuss market views and geopolitics. Click here to view summary reports and video links.

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Notably, the portfolio maintained its lead versus global moderate allocation peers YTD, largely benefitting from improving market breadth. Trend following peers reported strong performance, which was more in-line with our aggressive strategies.

Liquid alternatives like managed futures and long/short funds are staging a comeback. Although we noticed fees are high and performance can vary by manager.

Our framework determines appropriate allocations that dynamically reduce volatility without materially sacrificing upside. While this is difficult during regime shifts, active manager selection can help expand the opportunity set.

We spoke with legendary trend follower Jerry Parker about his process. Watch here or listen here.

The full portfolio report is available to subscribers below.

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The question becomes, is this just short-term rotation or the start of a greater shift?

In our latest special report, The Energy Awakening, we unpack the full picture:

→ The long-term relative breakout forming across multiple timeframes, market-cap segments, and where it stands with prior commodity super-cycle setups

→ Where institutional positioning stands today, and what can happen when the crowd is caught offsides at a cycle turn

→ Seasonal patterns, business cycle rotation signals, and cross-asset correlation data that make energy a genuine portfolio diversifier right now

→ How we’re positioned — including specific sector tilts, and a single-stock idea with a monthly chart that looks eerily familiar.

The full report is all yours…

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That was the focus of last week’s webinar. We reviewed macro and market cycles, current positioning, and portfolio adjustments. As practitioners managing long-term capital, this research directly informs our allocation decisions.

Below is the full report with slides, allocations, and a recording for subscribers.

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We’ll discuss the current U.S. valuation reset, broad market rotation, and global opportunities. Our framework will provide macro context that guides our positioning across assets.

In the meantime, check out our latest podcast interviews:

• CMT Association Fill the Gap: Damanick Dantes, CMT discussed our adaptive, quantitative approach to portfolio management, emphasizing the importance of trend, momentum, and dispersion across global asset classes. Listen here.

• Traders of the World: A masterclass on how we balance risk and reward using a disciplined investment process. Damanick also discussed his CMT board service, mentorship, and our commitment to ethics. Special thanks to our friends in Brazil. Watch here.

See you at the webinar.

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Please join our webinar on February 13 at 3:30pm to learn more about our portfolio suite and new positioning.

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• Combine trend, momentum, and dispersion models: Long-term trends define the core, while momentum is used for over/under-weights, and dispersion metrics like volatility and z-scores provide risk control rather than fixed rebalancing. We use relative price ratios to determine tilts.

• Diversify beyond the traditional 60/40: Stock/bond correlations are declining while commodities are showing improving momentum versus stocks and bonds. We discussed the uncertainty around inflation and the need for diversified return drivers instead of relying on bonds as the sole hedge.

• Reduce U.S. concentration risk while staying overweight equities: We continue to tilt away from mega-cap heavy U.S. indices toward small-caps and non-U.S. country selections. Aggressive portfolios hold a mix of equities and commodities to achieve targeted returns. Moderate portfolios are underweight fixed income, albeit with active global bond exposures that manage convexity.

🗓️ Join Isaac Diop and Damanick Dantes for the next webinar on February 13, 2026 at 3:30pm ET. Register here

Presentation recording and slides are available to subscribers below.

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Current signals favor selective tilts in non U.S. equities and within U.S. equities (factors, size, and style) versus large-cap concentration. We also noticed opportunities within commodities and across cyclical currencies.

The full report with detailed positioning rationale is available to subscribers.

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Our gift to you — the webinar is complimentary. Click here to register.

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Notably, the portfolio significantly outperformed the SocGen CTA Index YTD and sidestepped earlier drawdowns seen among active fund managers YTD. Returns were significantly enhanced by combining the moderate portfolio with aggressive sleeves, which outperformed their respective benchmarks YTD.

Three variations of the Alpha Capture "moderate" portfolio include aggressive sleeves such as the Bitcoin/Gold rotation and absolute-return global opportunity model.

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See you then!

Dantes Outlook Team

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Much of our work this year builds on ideas, research, systems, and frameworks that have been developing for years, and in January of 2025, we formally launched one of those ideas into a live framewor…

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