The Macro Regime Driving My Investment Decisions | The Saturday Sendout

This is a free preview of a paid episode. To hear more, visit thesimpleside.substack.comReminders - Disclosure is in the email footer - You can copy trade our potfolios here - You can get our daily news updates here - You can see our stock research reports here - Not all of these stocks make it into our portfoliosGood Morning, Simple Side ShareholdersLast week I told you that I had a few things planned for 2026. I wanted to share one of them with you now. The Macro Forecasting (aka The Simple Side Indicator) that I have been building behind the scenes. Of course, what you are looking at is a model that runs from 2010-2025. While predicting macro environments is near impossible, this model does a fairly good job of providing a “risk assessment” for anyone in the markets. You’ll notice a few places (I have marked them above) where the model was yelling “sell” and the market proceeded upwards, but in general, when you see a deep red sell indication it is a good time to step away from risk on assets. The same is true in the other direction, when you see a deep green color, typically it is an incredible time to “back up the truck.” This model will be shared will all paying subscribers starting in 2026 and will make weekly appearances in this newsletter alongside our market commentary, portfolio updates, etc… I will try to upload it onto the website TheSimpleSide.News soon as well. For those of you wondering, the dark red you see is a “Strong Sell” signal and the dark green is a “Strong Buy” signal. These two colors only appear about 4% of the time on this chart — typically indicating that there is a major market change on the horizon. Weekly RoundupThis weeks weekly roundup is going to be focused less on the news and more on what I am witnessing in the markets. The first thing I want to do is take a look at TSSI (The Simple Side Indicator) for 2025 and see how the data feels about the market.Overvalued.That is how the data feels about the market and how I feel as well. Paying subscribers know (and now you free folks do too) that I am 50% in equities and 50% in cash. Really, when I say in cash I am in accounts yielding 3.25% or 3.5% interest. In general, I feel like that is the correct position to be in given the current state of the market. What is the current state of the market: emotional. The market is being driven almost entirely by emotion, news, and investor sentiment. The market we would like to be invested in is the one where fundamentals are driving market prices.If you take a look at that beautiful red circle we have drawn above, you’ll notice that since June, the data behind the market hasn’t appeared favorable in the slightest. Now, surprisingly TSSI hasn’t actually hit a “Strong Sell” alert yet in 2025, though it has been close. Here is another view of the same chart….You can see that since June we have been exclusively in the “hold” and “sell” ranges. So, you are probably wondering why I am sitting in 50% cash when the indicator looks to be switching regimes from risk off back into a middle ground. Well, what is currently carrying the indicator from risk off to hold territory is the current market momentum. From July up until November, there has been incredible momentum in the market. That momentum has brough the market out of the “sell” phase and into the “hold” phase. However, there is something happening that might change the way the market will trend in 2026. That red circle on the right hand side of the screen… Momentum is slowing. Buyers are not showing up like they have in the past. If the regime starts to shift from hold back to the “risk off” territory, there is a great chance that we see another LARGE dip happen. One of the things we account for in this model are the Federal Fund Rates (set by the Federal Reserve), so if we end up losing chair Powell and a new chairman decides to honor Trump’s wishes by cutting rates, the model will take this into account. Needless to say, we are still very risk off. Building cash reserves, taking chips off the table, and being patient are the name of the game right now. I will be watching the data and the indicator heavily over the next few weeks and months as the government comes back online and we start to see somewhat more accurate data flowing again. Needless to say, we are still in a relatively RISK OFF REGIME right now. That can change, but at the current moment, risk off. Portfolio InformationPaid subscribers get direct access to all of these portfolios & real-time updates by joining paid here. Or you can directly copy trade by going here: Autopilot.I have had my portfolios available to copy on Autopilot since July, and had them available on DoubleFinance (which is now closed) since early in 2025. Since then, the market has returned about 7% to investors that makes up about half of the YTD returns of around 16%.That is relatively impressive performance for the SPY (not comparable to the past few years), but compared to the 10-12% most investors expect, 16% is great! On Autopilot, our portfolios show returns of 1.58%, 14.12%, and 12.01% (again returns since July 2025). All but one of my portfolios has nearly doubled the SPY returns since they were shared on Autopilot! If you have been following me since the beginning of the year (and invested in the AI Second Hand Effects portfolio at my initial article send in late 2024), you would be looking at two portfolios with returns of 36.16% returns in the Flagship Fund and 57.76% in the AI portfolio! Not too bad for someone who makes stock picks once a year! Regardless, 2026 is shaping up to be a challenge. As I come into the 2026 rebalancing season for my portfolios I am increasingly disheartened by the prospects of the 2026 year. As always, there can be a multitude of anomaly events that could launch the market in one direction or another. All that being said, I have some BIG updates coming for the portfolios (especially the Tech Growth), and even more changes coming in early 2026! If you are not allowed behind the paywall (aka not a paying subscriber, you should join now). We are and have been increasing our offerings to paying subscribers and have been showing real results and real returns for years now. If you haven’t wet your beak yet, 2026 is the yea to do so. Portfolio Returns, Holdings & UpdatesFLAGSHIP FUND: LINK