Hussman Funds - Weekly Market Comment: March 20, 2006 - Everything Looks Good at the Top of the Channel

Hussman Funds - Weekly Market Comment: March 20, 2006 - Everything Looks Good at the Top of the Channel: "As of last week, the Market Climate for stocks was characterized by unusually unfavorable valuations and relatively neutral market action. As noted above, market action appears firm in the major indices, but internal conditions are less compelling. Hence the neutral overall condition. The Strategic Growth Fund remains fully-hedged against the impact of market fluctuations here, but it's possible that we would accept a modest amount of market exposure (say, as much as 20-25%) if we were to observe a general market pullback without much deterioration in market internals. For now, with the markets clearly overbought, the case for increasing our market exposure isn't very convincing.
In bonds, the Market Climate remains characterized by unfavorable valuations and unfavorable market action. The Strategic Total Return Fund continues to carry a duration of about 2 years (meaning that a 100 basis point change in interest rates would be expected to affect Fund value by about 2% on the basis of bond price fluctuations), and a recently increased exposure to precious metals shares near 15% of assets. "