Tactical Changes November 2026

Happy Fall!

Recent market action suggests that investor sentiment might be shifting, as fear appears to be overtaking greed as the primary motivation driving financial markets. Despite healthy corporate earnings and continued economic growth, investors seem increasingly focused on the risks ahead rather than the opportunities. A notable example of this shift is the growing concern surrounding debt-fueled investment in artificial intelligence and whether the eventual returns will justify the enormous spending and elevated valuations. This doesn't necessarily signal a market top or imminent correction, but it does suggest that investors may be increasingly sensitive to disappointing developments.

The top economic concern remains inflation, which appears increasingly entrenched in the economy. Despite an extended period of elevated interest rates, inflationary pressures have persisted, making additional Federal Reserve tightening increasingly probable. Higher borrowing costs could eventually weaken consumer spending, business investment, and employment, potentially pushing the economy into recession. Historically, recessions have frequently followed periods of aggressive monetary tightening. Equity markets, however, often decline in anticipation of economic downturns before they become apparent in the data, complicating matters for investors.

Against this backdrop of growing economic uncertainty, the recent midterm elections may be more a reflection of the challenges facing the economy than a catalyst for meaningful change in its direction. While political developments are attracting considerable attention, economic conditions have historically had far greater influence on financial markets than election outcomes. With Democrats gaining control of Congress, political gridlock is expected to limit significant new legislation. More consequential may be the delayed spending reductions enacted under the One Big Beautiful Bill Act, which could further strain consumers and become a drag on economic growth. On the positive side, increased congressional pressure to end the conflict with Iran and reduce tariffs could help alleviate two important sources of inflation and economic uncertainty.

There are no tactical changes to Provizr portfolios in November. Our indicators continue to support current allocations, although we remain attentive to signs of deteriorating market conditions.

Alan Brilliant

Co-Founder, Provizr

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