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.

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

The macro environment remains highly fluid with economic activity rebounding off historic lows and concerns building over a second wave of Covid-19 infections. Our thesis for the third quarter includes a 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, with equities volatile but not collapsing on bouts of negative news, and spreads well supported by Fed purchases and the lack of alternatives in a low-yield world. As such, our strategies are appropriately positioned for our outlook with a modest overweight in equities across balanced strategies and overweight spread sectors within fixed income. As the quarter evolves, however, we expect to begin toning down risk as valuations rise and to place an emphasis on security selection over broad beta risk.

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

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

While the equity rebound has been impressive, stocks still find themselves down for the year and facing a back half full of challenges. Near-term sentiment is riding high on rebounding data that has been surprising to the upside and strong policy efforts that have been supporting markets and the economy. Policy support may prevent a collapse in risk assets, but hindrances to meaningful upside include higher valuations and uncertainty surrounding the virus, earnings, and political fronts. For fixed income returns, we hold an optimistic outlook. Despite meaningful spread tightening over the last three months, valuations in most spread sectors are still priced for upside, while equities appear more fully valued given the rebound. High yield and other non-core fixed markets especially look attractive from a risk/reward perspective than most core equity markets.