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Insights & Manager Commentary

AthenaInvest Fourth Quarter 2022 Commentary

by Craig Love, on January 26, 2023

We are pleased with our portfolio performance in 2022 as we moved into cash for much of the year in our Global Tactical ETFs portfolio providing downside protection with a flexible allocation approach.  

Key Takeaways 
  • Despite a quarter-long rally, markets remained in Bear Market territory for the year with the US market down -20% for the year. Mid and small stocks fared better but were still down for the year by -16% and -15%, respectively. Value stocks turned in the best relative performers during Q4 and for the year were down -1%. Compounding the situation for investors were declines in both stocks and bonds, leading to the worst year in decades for the traditional 60/40 portfolio.
  • GDP bounced back by 3.2% in Q3, offsetting the Q1 and Q2 declines, resulting in roughly flat real GPD for the year through Q3. PMI Manufacturing and Services indices are in the high 40’s, well above typical recession readings. However, a concern is the recent decline in both measures. The job market is unusually strong with the unemployment rate at a near historic low of 3.5%, while job openings remain above 10 million, nearly twice the number of unemployed.
  • Q4 reported corporate earnings are projected to shrink an estimated -4%, the largest decline since Q3 2020 (-5.7%). Forward earnings are consistent with current market prices, as evidenced by a 12-month S&P 500 forward PE of 17.6%, roughly equal to the 5- and 10-year averages.
  • Some good news is inflation is coming down, with recent monthly rates approaching the Fed’s announced annual target of 2%. This shows that Fed tightening has set the stage for future lower inflation.
  • Our market indicators are mixed, as usual, with valuation measures at normal levels, economic measures normal, technical measures weak, and mixed behavioral measures of poor for the US Large Cap Barometer, excellent for International Developed markets, and normal for small caps.

Investment Results 

  • Global Tactical ETFs: 15.7% vs 8.6% since inception (9/1/2010)

For portfolio-specific commentary, click on the link below. 

Global Tactical ETFs


The Athena Market View, an interactive look at the current state of the markets and economy from four distinct viewpoints, is now updated. Explore Here

Source: Athena Invest


The information provided here is for general informational purposes only and should not be considered an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. It should not be assumed that recommendations of AthenaInvest made herein or in the future will be profitable or will equal the past performance records of any AthenaInvest investment strategy or product. There can be no assurance that future recommendations will achieve comparable results. The author’s opinions may change, without notice, in reaction to shifting economic, market, business, and other conditions. AthenaInvest disclaims any responsibility to update such views. These views may not be relied upon as investment advice or as an
indication of trading intent on behalf of any AthenaInvest. You are solely responsible for determining whether any investment, investment strategy, security or related transaction is appropriate for you based on your personal investment objectives and financial circumstances. You should consult with a qualified financial adviser, legal or tax professional regarding your specific situation. Investments involve risk and unless otherwise stated, are not guaranteed. Past performance is not indicative of future performance.

Topics:Manager CommentaryAthena