Your 5 weekly reads:

Range Takeaway: Despite the headline 23,000 job loss, we hesitate to suggest the economy is rolling over. The headline number is impacted by the education sector, where hiring can be volatile during the summer months. Private payrolls increased by 30,000, matching June’s gain. With immigration reversing, the economy now needs roughly zero new jobs a month to hold unemployment steady, down from ~200,000 a few years ago. Against that bar, we believe the data indicates a labor market that’s stable rather than collapsing.

Q3 opened with a bang. Semis fell 21% in July, their worst month on record, and the Nasdaq briefly dipped into correction territory.

We sat down with our CIO, Taresh Batra, to take stock of positioning, fundamentals, and the market’s outlook from here. The bottom line:

1. Amidst July’s pain, market technicals have reset in a positive direction. Levered ETF assets are down since their June peak, and retail interest in highly speculative themes has faded. We have a healthier backdrop today than we did entering Q3.

2. Meanwhile, corporate earnings continue to be resilient. As we conclude Q2 earnings season, S&P 500 companies are reporting average earnings growth of nearly 52%. Valuations aren’t cheap, but reasonable in the context of extraordinary growth.

These are the drivers of our constructive outlook for the second half. That said, there are real risks to consider. Long-term rates sit near multi-decade highs. The global economy has taken the oil shock in stride, but the buffer is evaporating. And positioning, while healthier, hasn't fully reset. Leverage and speculative appetite can rebuild quickly in a rising market.

It's precisely in strong markets that discipline is easiest to abandon and most valuable to keep. Expect more months like July on the way to what we believe are higher highs, and make sure your plan is built to withstand them.

We’re continuing our series breaking down the strategies we use to manage your portfolio, in plain English. This week: “disciplined portfolio rebalancing.”

Imagine you set your thermostat to 70°. The weather outside might cause your home’s actual temperature to change throughout the day, but the thermostat nudges it back without you having to adjust the dial. Your portfolio has a setting too, say 90% stocks and 10% bonds. That setting is tied to how much risk you’ve chosen to carry. And actual market performance plays the part of the weather.

When stocks rally, they can grow into a larger share of your portfolio (90% might become 95%), exposing you to more risk than you chose, right when stocks could be at their most expensive. When stocks fall, the reverse happens: 90% could slip to 85%, leaving you positioned too conservatively to catch a possible rebound.

Range does this rebalancing automatically against your annual realized-gains budget while scanning for tax-loss harvesting opportunities, so getting back to your ideal setting doesn’t create a surprise tax bill.¹

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Your risk setting only works if your portfolio is actually on it. Bonds forgotten in a target-date fund, idle cash, and disjointed account positions can all pull you off target without you noticing.

Ask Rai: “What’s my target risk profile, and how does my actual portfolio compare?” and our AI wealth advisor will lay your target allocation next to your real positioning across every account, break out how much sits in equities, bonds, and cash, and pinpoint where the gap is coming from, so you can rebalance and confidently maintain your desired exposure.²

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