UBS: Now Is The Time For Investors To Dial Back Risk

"In each of the past three years, stocks have pulled back from May to August," notes UBS's Jonathan Golub in a note to clients. "We believe that unique fundamental factors and events were the cause each year."

Unfortunately, Golub is convinced that the data is pointing to yet another sell-off in what he has dubbed "Spring Break IV."

"We believe that another spring break is likely to materialize and that now is a good time to begin dialing back on risk," we writes. Here's more from his note:

Looking at incoming data, we believe 2013 is ready to provide us with a fourth spring break in as many years.
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Since mid-November the market's advance has been out of sync with weak earnings and economic trends (consensus GDP is for 2% growth in 2013). More recently, a number of market indicators that typically move with equities have begun to point south. These include economic surprises, bond yields, inflation expectations, commodity prices, and investor sentiment.

Golub currently has a 1,425 year-end target for the S&P 500, which is 125 points below current levels.

One of the uglier developments has been the stalling of earnings growth, which is arguably the most important driver of stocks.

"Earnings growth has slowed to a crawl, and is likely to remain anemic," writes Golub.

Having said all of that, Golub also notes that UBS continues to favor U.S. stocks relative to its international peers.