Click HERE to access the FSInsight COVID-19 Daily Chartbook.
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Monday
Tuesday
Wednesday
SKIP THURSDAY
Friday
STRATEGY: Rebalance Granny Shots –> +3 net: 12 additions and 9 deletions
2.9% of incoming Olympic athletes are COVID-19 positive…wow
The Winter Olympics in Beijing starts on Feb 4 and the Olympic Committee has disclosed there have been 200 total positive COVID-19 tests among the athletes, officials and other participants. This is a positive test ratio of 2.9%.
– it might just be me, but I find this a pretty staggering figure
– but this figure might improve as we move closer to the opening ceremonies
…COVID-19 is rapidly retreating in the US
The 7D moving average of cases in the USA is 416,538, down sharply from 700,000 a few weeks ago. As the chart shows, the collapse in cases is startlingly fast — Omicron spread quickly and is retreating quickly. But 416,538 cases daily is still a pretty high number of cases. So this is a half-full situation. Cases are well off their highs but the magnitude of cases is still high.
– the trend is going in the right direction
Similarly, if we look at positivity rates, or the rate of case positives, this figure is also falling sharply.
– the latest figure is 15%
– well off the 45% seen a few weeks ago
– 7D avg is 22%
But a “decent” figure is below 10% — so we are still weeks away from this. However, it does look like COVID-19 will be substantially lower by the end of February.
STRATEGY: Rebalance Granny Shots –> +3 net: 12 additions and 9 deletions
Equity markets started February off with solid gains. And as we wrote over the past few days, we believe the probabilities for a violent rally are high, given the dramatic risk reduction seen in January.
We are rebalancing our Granny Shots portfolio. The Granny Shots portfolio is created by identifying stocks which fall within our 6 tactical/thematic portfolios and also rank high in the DQM quant model. The stocks with the most overlap (more portfolios) become the Granny Shots. For this rebalance:
– 12 Additions:CB 1.37% , CF -2.03% , CMI -5.28% , CVX 0.65% , DVN -2.62% , GL -0.33% , MNST -0.06% , ORLY -1.51% , PCAR -3.82% , PG 0.13% , VRSN -1.04% , XOM -1.13%
– 9 Deletions: AVGO -1.26% , AZO -0.32% , EOG -2.36% , PHM -2.36% , QCOM 0.77% , ROST -2.55% , TGT -2.68% , TXN -0.80% , ULTA -5.23%
– YTD Granny Shots is outperforming the S&P 500 by 182bp (down, but down less)
– 2021, Granny Shots outperformed the S&P 500 by 392bp
The breakdown of the additions is below.
Consumer Discretionary
ORLY -1.51%
Energy
DVN -2.62% , XOM -1.13% , CVX 0.65%
Financials
CB 1.37% , GL -0.33%
Information Technology
VRSN -1.04%
Consumer Staples
MNST -0.06% , PG 0.13%
Industrials
CMI -5.28% , PCAR -3.82%
Basic Materials
CF -2.03%
STRATEGY: 2022 theme –> BEEF –> Bitcoin (B) + Bitcoin equities (E) + Energy (E) + FAANG (F)
Our 2022 themes are shown below. And in not in any order:
– Bitcoin + Bitcoin Equities BITO -3.30% GBTC -1.94% BITW
– Energy
– FAANG FNGS -2.53% QQQ -1.25%
Combined, it can be shorted to BEEF.
– Homebuilders (Oct – Apr aka Golden 6 months) XHB -2.34%
33 Granny Shot Ideas: We performed our quarterly rebalance on 02/01.
See above for more details, the Granny Shots page will be updated shortly.
POINT 1: Daily COVID-19 cases 263,047, down -171,872 vs 7D ago…
Current Trends — COVID-19 cases:
- Daily cases 263,047 vs 434,919 7D ago, down -171,872
- 7D positivity rate 21.6% vs 26.4% 7D ago
- Hospitalized patients 123,374, down -13% vs 7D ago
- Daily deaths 2,556, up 11% vs 7D ago
The latest COVID-19 daily cases came in at 263,047, down -171,872 vs. 7D ago. All states have reported a lower case figure except DC and OH. The chart below shows the dramatic drop in daily cases. The daily cases this week have been down ~40-50% compared to last week.
- Sunday: 82,993 (1/30) new cases vs. 169,313 (1/23)down 51%
- Monday: 683,926 (1/31) new cases vs. 1,140,194 (1/24)down 40%
- Tuesday: 263,047 (2/1) new cases vs. 434,919 (1/25)down 37%
The 7D delta in daily cases have been negative in 12 of past 13 days and is still trending lower. The positivity rates have plunged recently, and it seems to soon fall below the “10%” threshold – recall that we view “below 10%” as a sign that the situation is under control. Although some of the media and some scientists recently warned that the Omicron subvariant BA.2 could extend the current wave, at least for now we have not seen the course of decline in daily cases slow or reverse. But as we learned in this pandemic that COVID has been so mysterious and unpredictable, anything is possible. We will track the mysterious and unpredictable data closely, anything is possible.
7D delta in daily cases has been negative in 12 of past 13 days…
The decline in the 7D delta in daily cases persists. About three weeks ago, the 7D delta (7D trend) was still +300,000 and now it has fallen to -200,000. This reflected the rapid and steady decline in daily cases. And if this trend persists, we could see the daily cases further accelerate to the down side.
Only 5 states are still seeing a rise in cases while 45 states + DC are seeing cases falling…
*** We’ve split the “Parabolic Case Tracker” into 2 tables: one where cases are falling (or about to fall), and the other where cases are rising
In these tables, we’ve included the vaccine penetration, case peak information, and the current case trend for 50 US states + DC. The table for states where cases are declining is sorted by case % off of their recent peak, while the table for states where cases are rising is sorted by the current daily cases to pre-surge daily cases multiple.
- The states with higher ranks are the states that have seen a more significant decline / rise in daily cases
- We also calculated the number of days during the recent case surge
- The US as a whole, UK, and Israel are also shown at the top as a reference
Daily deaths are still rising, while positivity rates and hospitalization are falling now…
Below we show the aggregate number of patients hospitalized due to COVID, daily mortality associated with COVID, and the daily positivity rate for COVID
- Net hospitalization started to roll over. And more importantly, the daily mortality did not follow the same pattern as hospitalization, which shows Omicron is less deadly compared to other variants (at least so far).
- Positivity rate finally started to fall after plateauing for two weeks. It also confirms the recent decline in daily cases.
POINT 2: VACCINE: vaccination pace has slowed recently… Still more than half of eligible people have not received their booster shots…
Current Trends — Vaccinations:
- avg 0.7 million this past week vs 1.0 million last week
- overall, 27.0% received booster doses, 63.6% fully vaccinated, 75.0% 1-dose+ received
Vaccination frontier update –> all states now near or above 80% combined penetration (vaccines + infections)
*** We’ve updated the total detected infections multiplier from 4.0x to 2.5x. The CDC changed the estimate multiplier because testing has become much better and more prevalent.
Below we sorted the states by the combined penetration (vaccinations + infections). The assumption is that a state with higher combined penetration is likely to be closer to herd immunity, and therefore, less likely to see a parabolic surge in daily cases and deaths. Please note that this “combined penetration” metric can be over 100%, as infected people could also be vaccinated (actually recommended by CDC).
– Currently, all states are near or above 90% combined penetration
– Given the 2.5x multiplier, all states besides MS, WA, OR, TX, ID, MI, MO, and GA are now above 100% combined penetration (vaccines + infections). Again, this metric can be over 100%, as infected people could also be vaccinated. But 100% combined penetration does not mean that the entire population within each state is either infected or vaccinated
There were a total of 583,346 doses administered, as reported on Tuesday. The overall vaccine pace has slowed and the daily number of vaccines administered has been down over the past week. This probably is partially due to the improving COVID case trend. But given the benefits that vaccination provides:
– reduce severity –> reduce hospitalization –> prevent healthcare crisis
– reduce the transmission of virus
– we believe the daily number of vaccines administered remains the most important metric to track.
And as we noted previously, there are still half of booster-eligible people (more than 80 million) who have not yet received their booster dose. Hence. to convince these people remains the key.
This is the state by state data below, showing information for individuals with one dose, two doses, and booster dose.
In total, 539 million vaccine doses have been administered across the country. Specifically, 249 million Americans (75% of US population) have received at least 1 dose of the vaccine. 211 million Americans (64% of US population) are fully vaccinated. And 89 million Americans (27% of US population) received their booster shot.
POINT 3: Tracking the seasonality of COVID-19
***We’ve updated the seasonality tracker to show figures from the last 9 months, from this calendar day, in each of the last two years***
As evident by trends in 2020 and 2021, seasonality appears to play an important role in the daily cases, hospitalization, and deaths trends. Therefore, we think there might be a strong argument that COVID-19 is poised to become a seasonal virus.
The possible explanations for the seasonality we observed are:
– Outdoor Temperature: increasing indoor activities in the South vs increasing outdoor activities in the northeast during the Summer
– “Air Conditioning” Season: similar to “outdoor temperature”, more “AC” usage might facilitate the spread of the virus indoors
– Opposite effects hold true in the winter
CASES
It seems as if the main factor contributing to current case trends right now is outdoor temperature. During the Summer, outdoor activities are generally increased in the northern states as the weather becomes nicer. In southern states, on the other hand, it becomes too hot and indoor activities are increased. As such, northern state cases didn’t spike much during Summer 2020 while southern state cases did. Currently, northern state cases are showing a slight spike, especially when compared to Summer 2020. This could be attributed to the introduction of the more transmissible Delta variant and the lifting of restrictions combined with pent up demand for indoor activities.
HOSPITALIZATION
Current hospitalizations appear to be similar or less than Summer 2020 rates in most states. This is likely due to increased vaccination rates and the vaccine’s ability to reduce the severity of the virus.
DEATHS
Current death rates appear to be scattered compared to 2020 rates. This is likely due to varying vaccination rates in each state. States with higher vaccination rates seem to have lower death rates given the vaccine’s ability to reduce the severity of the virus; states with lower vaccination rates seem to have higher death rates.
