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  • There Is No Indicator To Forecast The Magnitude of a Correction February 21, 2022

    Technical and fundamental analysts are wasting their time in the search of an indicator that will forecast the magnitude of a correction. It’s already hard enough to forecast the market direction, or what quants may call the sign of the return ...

  • S&P 500 Weekly and Monthly Losses Larger Than 10% February 16, 2022

    Some market participants argue tail risk hedging of portfolios tracking the S&P 500 is not necessary because large losses on weekly or monthly timeframes are rare. They are both right and wrong: large losses are indeed rare but when they ...

  • Latest Campaign of Permabears Involves Consumer Price Index Charts February 15, 2022

    Permabears have used in the past various arguments and charts in an effort to convince investors equity markets and economies will crash. The latest campaign involves long-term consumer price index charts. Before quantitative easing, most permabears used technical analysis and chart ...

  • Growth Vs. Value Could Be an Outdated Classification February 10, 2022

    Growth and value relative strength has changed in different regimes based on the momentum of the companies included in these classifications/factors. Therefore, what occurred in the past may not necessarily occur in the future. Possibly, these notions are outdated. The relative ...

  • Smart Money Profits From Bear Markets February 5, 2022

    Who benefits and who loses during bear markets? It’s not who most people think. Smart money has always benefitted from bear markets. Passing investors and especially those close to retirement are always scared of the possibility of a bear market. This ...

  • Common Sense Analysis of Strategy and Fund Performance January 22, 2022

    Money is important but also time. There is also the aphorism “time is money”. When looking at strategy and fund performance, common sense does a good job. Common sense is often lost in advanced statistical analysis. Using common sense offers a ...

  • Bitcoin Correlation with Equities is Increasing While Commodities Offer Diversification Potential January 20, 2022

    Bitcoin correlation with equities has been on the rise since September of last year. Commodities correlation with equities remains high but they offer some diversification for fixed income portfolios. Year to date, stocks (SPY) are down 4.9% while bonds (TLT) are ...

  • Stocks Have Not Performed Badly During Negative Real Interest Rate Regimes January 13, 2022

    As the data since 1942 show, negative real interest rates haven’t been a bad environment for the stock market. If fact, a significant fraction of the annualized return of S&P 500 has been generated during periods when inflation was higher ...

  • The Value-to-Growth Ratio May Be Uninformative January 7, 2022

    The value-to-growth ratio is often used as an indicator of relative strength but it may not have any predictive power. Main reasons for this failure are probably continuing technological innovation and funding of new ventures having decoupled from cost of ...

  • Some Of Best Performing Stocks Have Been Brutal Investments Historically January 5, 2022

    Some of best performing stocks since the March 2020 bottom have also been the most volatile historically. It sounds like a market paradox but it makes sense. Read below why. The table below shows a list of the 15 top stocks ...