This one-page report details what contributed to and detracted from performance for the Sage Tactical ETF Strategies in the third quarter.

The following presentation outlines the current economic conditions, policy response and valuations, as well as how Sage is positioned in the current environment.

This brief report details how the markets are likely to respond to various elections scenarios. It explains the impact of Covid-19 cases on polling, how the S&P 500 has performed historically post-elections, the potential impact of contested results, and the effects of trade, fiscal, and monetary policies.

While markets experienced a rocky September following a very strong August, evidence points to further economic recovery and upside in risk assets. Data should remain supportive with post-lockdown growth above trend, an accommodative Fed, and favorable sentiment. As such, we retain our recovery positioning, with tilts toward equities and higher-yielding fixed income. Less attractive valuations and rising geopolitical risk have, however, prompted several tactical adjustments recently to position for continued market volatility and a recovery with less upside surprises.

Despite the ongoing congressional impasse over a Phase 4 fiscal package, risk assets continue to move higher on positive data and supportive policy. Our thesis for the third quarter remains the same: continued recovery in data but less surprises to the upside, and a continued commitment from policymakers to stay accommodative through 2020. This should keep the tone generally positive for risk markets, but with increased volatility given higher valuations, shifting Covid-19 infection rates, and the U.S. elections. As such, our strategies are appropriately positioned for our outlook with a modest overweight in equities across balanced strategies and an overweight to spread sectors within fixed income. As the quarter evolves, we expect to tone down risk as valuations rise and place an emphasis on security selection over broad beta risk.

The Sage Strategy Detail presentation offers relevant performance, risk analytics, and portfolio characteristics for each strategy.

The Sage Strategy Detail presentation offers relevant performance, risk analytics, and portfolio characteristics for each strategy.

The Sage Strategy Detail presentation offers relevant performance, risk analytics, and portfolio characteristics for each strategy.

The Sage Strategy Detail presentation offers relevant performance, risk analytics, and portfolio characteristics for each strategy.