At BFIA we exploit behavioral biases to detect long-term investment cycles. The major investment cycle we have been talking over this year has been in the Asian markets with India being the biggest and Malaysia, South Korea, Indonesia, and Thailand being the other Asian markets we like. We also have talked about Turkey and it is our second biggest position.
We are still sticking with this investment cycle even with the recent run up in these markets.
We also like to look at our agent-based behavioral measure each week to determine where the US market is currently standing. Even with the recent run up we still see the US as undervalued. One key concern is that the dynamics of our measure look similar to the dynamics in April of this year. We are currently at 0.914 and the measure was at 0.946 at the beginning of May. Once we hit 0.946 again we will look for any signs within our behavioral measures to determine whether there will be a large pullback.
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