"Analysis Without An Agenda"
Pentonomics

Inflation's Real Cause

According to Pimco's new Chief Economist, Paul McCulley, the Fed's war against inflation has been won! But, before we get out our party hats and plan the tickertape parade, we have to ask ourselves - for the past 27 years have we really been at war with inflation?

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Pento Portfolio Strategies
Separate Managed Accounts (SMA)
Inflation/Deflation Dynamic Portfolio

To inquire about our managed accounts please call:
1-732-772-9500

PORTFOLIO AS OF June 30, 2014

PENTO PORTFOLIO STRATEGIES - INFLATION/DEFLATION DYNAMIC PORTFOLIO
Is an actively managed product that provides complete access to Michael Pento’s twenty-years worth of industry experience, direct account supervision and proprietary investment model.

KEY BENEFITS:

  • Adaptive, Dynamic management of Michael’s investment philosophy, along with that of his investment team.
  • Investment Policy Committee specifically focused on strong dollar (deflation) / weaker dollar (inflation) correlations and how that paradigm interfaces with a uniquely identified universe of asset classes.
  • Attempts to provide inflation protection with lower beta than static portfolios that ignore changes in USD intrinsic valuations.
  • Global fundamental economic and market analysis provided by Michael Pento, technical analysis provided by Bruce Zaro.
 

STRATEGY OVERVIEW

The Pento Portfolio Strategies Model SMA attempts to provide capital appreciation and income from a global universe. We use a top down macro analysis to position the portfolio in broad asset classes, depending on our view of inflation and deflationary forces. We further screen for the best sectors to capitalize on these trends, based on our historical back testing models. Finally, we use our technical database to select the best possible securities within these favored sectors.

INVESTMENT PROCESS

The Investment Policy Committee convenes weekly where investment themes and strategies are presented and approved by Michael Pento (Committee Chairman). Performance reviews are then conducted on each asset class and individual investment. The Committee discusses the model’s output regarding the direction of the US dollar and the inflation or deflation environment.

Sample Model Components

PPS’s proprietary investment model uses various metrics to determine the macroeconomic environment in relation to the inflation/deflation dynamic. Example criteria include:

Public and private sector debt levels
- Monetary aggregate growth rates
- Bank loan growth
- Nominal and real level of interest rates
- Commodity and Equity prices
- Central banks' balance sheet size and composition
- Interest expense on Sovereign level
- International Currency fundamentals
- Balance of payments surplus/deficit of key economies

MODEL PORTFOLIO COMPOSITION

Pento Portfolio Strategies Investment Policy committee uses a weighted approach re-garding its stance on the US dollar’s level and trend, as well as the inflation/deflation dynamic. Based on this outlook we will assign weightings to weak dollar assets and strong dollar assets. The investable universe may include domestic stocks, non-US stocks, commodities and alternative assets, domestic and foreign bonds, currency ETF’s, volatility investments and short-market strategies. Our options strategy includes covered call writing, along with the purchase of index and sector puts and calls.

PORTFOLIO REBALANCING AND TURNOVER

Changes to our portfolio are a dynamic process; there is no set schedule for rebalancing. Portfolio rebalancing occurs whenever the model and our investment committee dictate its necessity. PPS also focuses on technical price levels relative to their trading ranges and utilizes an active risk management strategy that seeks to lock in gains and limit losses.

TO OPEN AN ACCOUNT

Please call
1-732-772-9500

INVESTMENT TEAM

Michael Pento
Chairman
Investment
Policy Committee


23 years investment experience. Portfolio creator and consultant to Delta/Claymore’s commodity portfolios that raised in excess of $3 billion and were distributed through Claymore / Guggenheim’s sales network.

Peter Grandich
Senior Market
Strategist


31 years of investment experience. Peter was a portfolio manager for four hedge funds and a mutual fund that bore his name before joining PPS.

Justine Coleman



Research and Technical Assistant

21 years experience in the Financial Reporting Industry

http://www.pentoport.com

PERFORMANCE

Click image to enlarge

 

Past investment performance is not indicative of future results. Advisory services offered through Pento Portfolio Strategies, LLC. a Registered Investment Adviser.

Holdings represent the largest holdings in the Pento Portfolio Strategies Model – SMA Managed Account as of 06/30/2014. These holdings are subject to change at any time without notice and individual account holdings may vary. The specific securities do not represent all the securities PPS Model - SMA has purchased, sold, or recommended for clients over the past year. The reader should not assume that investments in securities listed above were or will be profitable. Sector diversification represents sector allocations in PPS Model – SMA as of 06/30/2014. These sector allocations are subject to change at any time without notice and individual account sector allocations may vary. This document has been prepared for the intended recipient only as an example of strategy consistent with our recommendations; it is not an offer to buy or sell or a solicitation of an offer to buy or sell any security or instrument or to participate in any particular investing strategy. All securities involve varying amounts of risk, and their values will fluctuate.

Carefully consider the risks and special considerations associated with investing in the Model – SMA Managed Account. You may lose money by investing in the Model Account.

Pento Portfolio Strategies
Separate Managed Accounts (SMA)
Global Yield-Enhanced Dividend Portfolio

To inquire about our managed accounts please call:
1-732-772-9500

PORTFOLIO AS OF March 31, 2014

PPS-SMA Global Yield-Enhanced Dividend Portfolio
Is an actively managed product that seeks to maximize returns by writing covered calls on high-dividend in-vestments and also provides complete access to Michael Pento’s twenty-years worth of industry experience.

KEY BENEFITS:

  • Adaptive, Dynamic management of Michael’s investment philosophy, along with that of his investment team.
  • Investment Policy Committee specifically focused on identifying investments that offer a high dividend yield and have low pay-out ratios. In addition, equities that are selected for inclusion should illustrate a history of raising their dividend.
  • Portfolio is designed to maximize returns by augmenting the yield through covered call writing. Portfolio avoids investing in sovereign debt, and instead concentrates on owning an internationally diversified basket of corporate bonds and high-yielding equities.
  • Global fundamental economic and market analysis provided by Michael Pento.
 

STRATEGY OVERVIEW

The Global Yield-Enhanced Dividend Portfolio attempts to provide capital apprecia-tion, dividends and increased yield from selling covered call options. Holdings are selected from a global universe of ETFs, individual stocks and bond funds. The fund eschews investments in sovereign debt due to interest rate suppression and the lack of growth opportunities.

INVESTMENT PROCESS

The Investment Policy Committee convenes weekly where investment themes and strategies are presented and approved by Michael Pento (Committee Chairman). Performance reviews are then conducted on each asset class and individual investment. The Committee discusses the performance of all holdings and determines the invest-ment’s ability to maintain the dividend. Call writing opportunities are then evaluated.

Portfolio Selection Criteria

Country criteria selections are biased towards stability of government, strength of currency, low debt to GDP ratio, high relative growth rate and a current account surplus. Industry criteria is vetted from proprietary models created by Michael Pento for the purpose of determining specific industries that are positioned to prosper in specific macroeconomic environments. Individual securities are then selected within the favored industries and which display the potential to raise their dividends. Equities selected should also have sufficient cash-flow coverage, good valuation and a strong balance sheets.

PORTFOLIO COMPOSITION

The PPS Global Yield-Enhanced Dividend Portfolio will hold ETFs, ADRs, Corporate Bond Funds and Individual Equities of both U.S. and International Investments. The Portfolio will only invest in international investments that trade with the added benefits and liquidity of trading as American Depositary Receipts. Our options strategy seeks to take advantage of those holdings that offer higher beta and liquidity in order to maxi-mize the yield-enhancing strategy associated with covered call writing.

PORTFOLIO REBALANCING AND TURNOVER

Changes to our portfolio are a dynamic process; there is no set schedule for rebalancing. Portfolio rebalancing occurs whenever the model and our investment committee dictate its necessity. PPS also focuses on technical price levels relative to their trading ranges and utilizes an active risk management strategy that seeks to lock in gains and limit losses.

TO OPEN AN ACCOUNT

Please call
1-732-772-9500
and ask about our managed accounts

INVESTMENT TEAM

MICHAEL PENTO
Chairman
Investment
Policy Committee


22 years investment experience. Portfolio creator and consultant to Delta/Claymore’s commodity portfolios that raised in excess of $3 billion and were distributed through Claymore / Guggenheim’s sales network.

Peter Grandich
Senior Market
Strategist


30 years of investment experience. Peter was a portfolio manager for four hedge funds and a mutual fund that bore his name before joining PPS.

Justine Coleman



Research and Technical Assistant

20 years experience in the Financial Reporting Industry

http://www.pentoport.com

PERFORMANCE

Click image to enlarge


Past investment performance is not indicative of future results. Advisory services offered through Pento Portfolio Strategies, LLC. a Registered Investment Adviser.

*Yield is calculated before the implementation of the covered call writing strategy.

Holdings represent the largest holdings in the Pento Portfolio Strategies Global Yield-Enhanced Portfolio – SMA as of 03/31/2014. These holdings are subject to change at any time without notice and individual account holdings may vary. The specific securities do not represent all the securities PPS Portfolio- SMA has purchased, sold, or recommended for clients over the past year. The reader should not assume that investments in securities listed above were or will be profitable. Sector diversification represents sector allocations in PPS Portfolio – SMA as of 03/31/2014. These sector allocations are subject to change at any time without notice and individual account sector allocations may vary. This document has been prepared for the intended recipient only as an example of strategy consistent with our recommendations; it is not an offer to buy or sell or a solicitation of an offer to buy or sell any security or instrument or to participate in any particular investing strategy. All securities involve varying amounts of risk, and their values will fluctuate, and the fluctuation of foreign currency exchange rates will also impact your investment returns if measured in U.S. Dollars.

Carefully consider the risks and special considerations associated with investing in the PPS Global Yield-Enhanced Dividend Portfolio– SMA. You may lose money by investing in the Account.

 

 


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