AVDV: The Commodity Engine Has Cooled, Japan Hasn't

Japan's reform is structural and intact. Long-term investors can accumulate in this consolidation, but there is no urgency today. See why AVDV is a Hold.

Summary - AVDV has returned ~21% since my November Buy. The Japan thesis worked - but the outperformance came from somewhere I did not write about. - Japan delivered in line; SCJ actually outran the fund.

The breakaway came from a commodity sleeve, mostly gold miners, now cooled. - The forward setup has turned. Gold looks rangebound, the Fed is hawkish, and the yen carry gap persists.

No currency tailwind, no commodity steam. - Downgrading to Hold. Japan's reform is structural and intact.

Long-term investors can accumulate in this consolidation, but there is no urgency today. Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions.

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