Market Insights: Last Week in Review with Rusty Vanneman, Vol. 76

US futures are pointing to a higher open to start a busy week that is loaded with earnings reports (including Alphabet, Amazon, Apple, and Microsoft) and the next Federal Open Market Committee (FOMC) decision (Morningstar, July 2022).

  • The FOMC is expected to raise rates 75 basis points (Morningstar, July 2022).

Last week, the US Total Market (Morningstar indices) gained nearly 3%.

  • Growth stocks gained nearly 4%; value stocks gained about 1% (Morningstar, July 2022).
  • Large cap stocks gained around 2%, while small cap stocks gained about 4% (Morningstar, July 2022).
  • Bonds gained nearly 1% commodities gained nearly 3% (Morningstar, July 2022).

Regarding highlights last week, one big one was that the ECB (European Central Bank) rose interest rates for the first time in 11 years. Inflation data for June for the UK also just hit a 40-year high like the US.  (CNBC, July 2022).

The Ten-year Treasury yields last week finished at 2.78% (down 0.12% over the last week) (Yahoo! Finance, July 2022). Recall the high was 3.48% on June 14 (Yahoo! Finance, June 2022).

  • The yield to maturity on theBloomberg Aggregate Bond Index also dropped last week (by 15 basis points) to 3.57% as of July 22 (Bloomberg, July 2022). The cycle high was on June 14 at 03% (Bloomberg, June 2022).
  • Theaverage money market yield is now 32% as of July 23 (Crane Data, July 2022).

The average 30-year fixed mortgage rate, however, increased last week to 5.84% as of July 22 (Bankrate, July 2022). This is near the cycle high of 5.91% on June 17 (Bankrate, June 2022). Hmmm.

Deeper Dive 

The market has rallied sharply into this over the last month, with the S&P up about +10% and the Nasdaq up nearly +15% off their respective June lows (Morningstar, July 2022).

YTD performance highlights:

  • The Total US Market is down about 17% (Morningstar, July 2022).
  • Growth stocks are down 29%; value stocks are down 6% (Morningstar, July 2022).
  • Large cap stocks are down about 18%; small caps are down about 17% (Morningstar, July 2022).
  • Bonds are down over 9%; commodities are up 18% (Morningstar, July 2022).

Speaking of YTD performance, here are the top performers this year on the Orion Portfolio Solutions (OPS) Platform in terms of Alpha vs the S&P:

Alpha YTD

1 Brinker Direct Indexing Real Assets Thematic SMA 75.64
2. PIMCO Commodity Real Ret Strat Instl 64.19
3 AQR Managed Futures Strategy 48.46
4 Brinker Capital Real Assets – ETF 35.14
5 AQR Long/Short Equity Strategy 34.69


And here are the 3-year Alphas (PFM is Potomac)

1 PFM Bull Bear 9.99
2 Brinker Direct Indexing Biotechnology Thematic SMA 9.61
3 AQR Managed Futures Strategy 9.47
4 PIMCO Commodity Real Ret Strat Instl 9.23
5 Abbey Capital Futures Strategy 8.97


Could we get a recession? Perhaps. But I’ll still take the under on the “90% chance” of recession odds given by some pundits. The economy has incredible buffers right now including the labor market, the housing market, and consumer financial strength (Empire Financial Research, July 2022). On the latter point regarding the strong position of the U.S. consumer, Whitney Tilson of Empire Financial Research shows that Consumers’ ratio of liabilities to net wealth is at the lowest level in 50 years! (Empire Financial Research, July 2022).

In DoubleLine’s June 2022 research paper “Finding A Bottom in Equities”, they had a nice drawdown chart. In short, the current drawdown – while still painful – is still less bad than the typical drawdown.

From Main Management: “Since 1948, there have been 15 spikes in the inflation rate. In the 12 months following those spikes, the S&P 500 returned an average of +10.3% (+8.8% if there was a recession and +12.1% if there was not a recession).” (Main Management, July 2022)

And more Main Management from one of the highest energy President/CEO/CIOs in our profession — Kim Arthur. By the way, Kim sees the sign of high cash as a contrarian signal. While he’s still a bit cautious on the short-term, and the market could test the recent lows, he’s bullish (Main Management, July 2022).

Flows data from Ignites in July shows that actively managed mutual funds had their “worst start ever”, while index mutual funds had positive flows. The real star, however, is ETFs. They had strong inflows (second best start ever), and this was broad-based as all major asset classes had inflows for ETFs (Ignites, July 2022).

Last week’s economic numbers included:

To summarize why housing remains an economic strength of a weakness, I quote from this week’s “Weekly Wire” by Tim Holland of Brinker Capital:

  • “…we learned last week that the median price of an existing home sold in June hit a record $416,000, that builder sentiment, as measured by the NAHB Housing Market Index, remains five points above the 50 threshold that is still considered positive and there were 1.26 million homes for sale as of the end June, which, at the current sales pace, equates to an exceptionally low three-month supply.  In fact, if there is one datapoint more than any other that has us not expecting a meaningful downturn in housing, it is supply.  There are just 1.26 million homes for sale today; on the precipice of The Great Recession there were 4.0 million homes for sale.”

The Atlanta Fed’s GDPNow’s estimate for real (“after-inflation”) GDP growth (which uses actual economic data for inputs) decreased last week (GDPNow, July 2022). It now estimates for the second quarter 2022 GDP to be -1.6% as of July 19, 2022 (GDPNow, July 2022).

This week we will find out how close that GDP estimate is. The key number on this economic schedule is the next estimate of 2Q GDP (Calculated Risk, July 2022).

  • Other key reports include June New Home Sales, Personal Income and Outlays for June, and Case-Shiller house prices for May (Calculated Risk, July 2022).

It has now been six straight weeks of price drops for the average gas price (AAA, July 2022). It moved down to $4.34 (down another 18 cents from the prior week) (AAA, July 2022). The high was $5.01 on June 24 (AAA, June 2022).

Here’s a cool chart to play with: Inflation for Each Age (USA Facts, July 2022).

As for earnings, second-quarter earnings according to I/B/E/S data from Refinitiv:

  • 22Q2 Y/Y earnings are expected to be 6.2%. Excluding the energy sector, the Y/Y earnings estimate is -3.2% (Refinitiv, July 2022).
  • Of the 106 companies in the S&P 500 that have reported earnings to date for 22Q2, 75.5% have reported earnings above analyst estimates (Refinitiv, July 2022). This compares to a long-term average of 66.1% and prior four quarter average of 80.6% (Refinitiv, July 2022).
  • During the week of July 25, 172 S&P 500 companies are expected to report quarterly earnings (Refinitiv, July 2022).

In the soon to be updated OPS Quarterly Reference Guide, look out for some new content around stocks vs. bonds, stocks vs. commodities, and fresh stats on inflation. One classic will be an updated “quilt chart”.

Crypto Corner – Grant Engelbart, CFA, CAIA, Brinker Capital Sr. Portfolio Manager

  • Cryptocurrency tacked on another positive week last week, with Bitcoin rising 8% through Sunday afternoon, Ethereum surging nearly 20%, and other large coins like Cardano, Avalanche, and Polygon adding double digits (CoinMarketCap, July 2022).
  • Tesla reported earnings on Wednesday and announced that they sold 75% of the Bitcoin they had previously held on their balance sheet (Bloomberg, July 2022). Crypto exchange Zipmex is the latest to halt withdrawals, citing exposure to defunct lenders Celsius and Babel (Arcane Research, July 2022). A former Coinbase employee was charged with insider trading in what may be the first cryptocurrency insider trading case (Decrypt, July 2022).
  • There were no new ETF launches (of any kind) last week as we hit vacation season (Decrypt, July 2022).

Additional Resources  

“The best time to invest is when you have money.” Quotes from Sir John Templeton (GoodReads, July 2022).

 In Northern Trust’s June 2022 white paper on “Driving Growth In Asset Management”, one highlight was polling top executives at asset management firms: “What are your strategic priorities for operations in the next two years?” At the top, with 50%, was “Creating greater efficiency” (Northern Trust, June 2022).

And here is a short video on the future of wealth management from Orion CEO Eric Clarke (, June 2022).

Dr. Daniel Crosby of Orion on LinkedIn: Stocks bought by institutional fund managers tend to underperform the stocks sold by these same managers. Most bought stocks underperform most sold by 17% over two years. – Dasgupta et al, 2006. 

Last week’s Orion’s The Weighing Machine podcast with Chip Roame had a lot of good things to think about for anybody in our profession/industry. This week, our upcoming podcast is with portfolio manager Matt Werner from Chilton Capital Management. Matt gives us an overview of all thing’s real estate (but not residential!).

Use These Unconventional Job-Interview Questions to Find People With a Creative Spark” and more from the recent book “Talent” by Cowen/Gross (, July 2022). Lots of good examples of interview questions including:

  • What are the open tabs on your browser right now?
  • What did you do this morning?

Great short read on why social skills are more important than smarts now. Klement: Social skills get you a higher wage (Klement On Investing, July 2022).

The summer is reaching its later innings, so I searched for “an awesome summer photo” and came across a retro postcard picture on that said, “Everything will kill you so choose something fun.” Make the most of your August!

Then again, when it comes to summer fun, don’t try this boating move from the tweet: “Elon Musk’s management style.” (@JCOviedo6, July 19, 2022)

If you’re flying in the weeks ahead, realize the airports are indeed pretty crazy right now. Here are some travel tips from world traveler/money manager Whitney Tilson (Empire Financial Research, July 2022):

  • Go early
  • Always fly direct
  • Fly as early in the day as possible
  • Download the app of the airline you are flying
  • Think twice about the cheapest fares
  • Don’t tell a flight attendant they look tired
  • Bring patience

Thanks for reading and have a great week!  As always, please let us know what we can do better at or Invest well and be well. 



Orion Portfolio Solutions, LLC, a registered investment advisor, is an affiliated company of Brinker Capital Investments, LLC, a registered investment advisor, through their parent company, Orion Advisor Solutions, Inc.

The CFA is a globally respected, graduate-level investment credential established in 1962 and awarded by CFA Institute — the largest global association of investment professionals. To learn more about the CFA charter, visit

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About Rusty Vanneman, CFA, CMT, BFA
Rusty Vanneman serves as the Chief Investment Strategist for Orion Advisor Solutions. An industry veteran with more than 30 years of investment experience, Rusty creates relevant market- and platform-related content that supports deeper, more engaging conversations with advisors and investors, educating key internal and external audiences on Orion Portfolio Solutions’ strategies and resources to help deliver favorable investor outcomes, and helps identify new investment offerings to meet growing marketplace demand.  Rusty is a host of Orion’s The Weighing Machine weekly podcast, Orion’s monthly Weighing the Risk podcast, and authored the book “Higher Calling: A Guide to Helping Investors Achieve Their Goals.” Rusty has managed multiple mutual funds and hedge funds during his career and was named one of the Top 10 Portfolio Managers to Watch by Money Management Executive.* Prior to Orion’s acquisition of Brinker Capital in 2020, Rusty was the Chief Investment Officer for Orion Advisor Solutions and prior to that was the President and Chief Investment Officer of CLS Investments.  Before joining Orion in 2012, Rusty served as the Chief Investment Officer and Managing Director for a multi-billion-dollar registered investment advisor (Kobren Insight Management) in the greater Boston area. His 11-year tenure at the RIA included a five-year span when the firm was owned by E*TRADE Financial where he also served as the Senior Market Strategist for E*TRADE Capital. Prior, Rusty was a Senior Analyst at Fidelity Management and Research (FMR Co) in Boston. Additional work experience includes Thomson Reuters, General Electric, and as a cattle ranch hand in the Nebraska Sand Hills. Rusty received his Bachelor of Science in Management from Babson College in Wellesley, Massachusetts, where he graduated with high distinction. He holds the Chartered Financial Analyst (CFA®) designation and is a member of the CFA Institute. He is also a Chartered Market Technician® (CMT) and is a member of the Market Technician’s Association (MTA). He is also a Behavioral Financial Advisor (BFA). *RUSTY VANNEMAN MONEY MANAGEMENT EXECUTIVE AWARD. Rusty Vanneman, CFA, CMT, was selected as a “Top 10 Fund Managers to Watch” in 2017 by Money Management Executive. Money Management Executive is an unbiased, third-party publication covering the asset management industry. Money Management Executive chose the list of managers to watch by screening Morningstar data from funds with a single manager, ranked as having the best three-year annualized returns in their respective categories. The list of managers was published March 27, 2017. Money Management Executive is not affiliated with OPS. Ratings and awards may not be representative of any one client’s experience and are not indicative of OPS’s future performance.