What VIPER told us at Post6 during the 2016 United States presidential election may surprise you. As we all know now it was a historically profound event. Unprecedented worldwide media attention focused on the politics above all else, as opposed to the candidates and their proposed policies.
The “favorite” candidate
One candidate was clearly the “favorite” of nearly every media outlet. The other candidate, we’ll term the “non-favorite” candidate, was predicted to lose and lose dramatically. Concerning to us at Post6 was the flow of dire predictions for the market should the “non-favorite” win. Day after day leading up to the election those predictions flowed. But VIPER was telling us a different story: stay the course. So we did, and VIPER returned greater than 20% in the immediate run-up and post-election market environment. Specifically, the month of November 2016. We suspect a lot of investors speculating on a sizable post-election volatility spike (or perhaps the end of the world!) were left scratching their heads. In fact, we’ve seen some market talking heads that have been, and remain, “long volatility” this entire time!
This illustrates the benefits of following a solid strategy that is filtering out the noise and continuing to focus on the same market fundamentals that have made it successful historically. We like to say we “drove a straight line right through the hype!”