Will Q4 Earnings Confirm Recent Economic Strength?
My scorecard for earnings season will look for the following company characteristics: Confidence. I expect most to have a murky outlook, with no reason to set the future bar very high. Important trade relationships – imports or exports. Comments on these fears may create some buying opportunities. Concern about a stronger dollar. Everyone is teed up to watch for this, and we should as well.
2017 Global Market Outlook
The search for investment portfolio returns is not going to get any easier in 2017 against a backdrop of record U.S. equity prices, narrow credit spreads and low bond yields.
What May Be in Store for Alternatives in 2017?
As we enter 2017, there is a long list of issues that could affect alternative investments: policy changes in the US, elections in Europe, rising rate expectations and more. Given this changing landscape, I would like to highlight some alternative investments that I believe have the potential to benefit investors in the new year.
Digging Down on the Trump Effect
Some sort of fund repatriation will be part of the package. All else equal, that suggests a bias to companies that might gain the most. The Atlanta Fed provides some hard data. Expect tax cuts, probably including some nods to Democrats. This will represent fiscal stimulus. Cyclicals continue to show strength, partly from the expectation noted above. (Eddy Elfenbein). The trade war is likely to be a bargaining approach. It is an error to over-react on speculation. The health care issue is far from settled. Early symbolic repeal? Yes. Real changes? Unclear.
Market Cap to GDP: An Updated Look at the Buffett Valuation Indicator
With the GDP Q3 Third Estimate, we now have an updated look at the popular "Buffett Indicator" -- the ratio of corporate equities to GDP. The current reading is 121.2%, down from 124.9% the previous quarter. It is off its 129.7% interim high in Q1 of 2105.
The Long-Term Investing Myth
During my morning routine of caffeine supported information injections, I ran across several articles that just contained generally bad investment advice and poorly formed analysis. Each argument was hinged on the belief that bull markets last indefinitely, bear markets are simply an opportunity to “buy” more, and investing for the long term always works.
“It’s what you learn after you know it all that counts.” - Earl Weaver
Weighing the Week Ahead: Santa Rally Trumped?
2017 begins with plenty of economic data crammed into a short week. While most expected at least a touch of Dow 20K last week, it did not happen. The conversation quickly shifted to why the rally stalled out. In the coming week, the punditry will be asking: Should we expect a weak start to 2017?
Moving Averages: December Month-End Update
Valid until the market close on January 31, 2016
The S&P 500 closed December with a monthly gain of 1.82% after a gain of 3.42% in November. All three S&P 500 MAs are signaling "invested" and three of the five Ivy Portfolio ETF MAs — Vanguard Total Stock Market ETF (VTI), PowerShares DB (DBC), and Vanguard FTSE All-World ex-US ETF (VEU) — are signaling "invested". In the table, monthly closes that are within 2% of a signal are highlighted in yellow.
The 10 Largest Closet-Index Funds
The flow of assets to passive products over the last several years has increased the pressure on active mutual funds. Analysts are predicting an industry consolidation with the prime target being those funds that track an index but charge relatively high active management fees – the so-called closet-index funds. Here are the 10 largest such U.S. large-cap equity funds.
Smoothing the Ride in European Equities
Risk appetite has returned to European equity markets. Is there a way to capture the rally of value stocks while mitigating risks across an unsettled region? Focusing on cash flows can make the difference.
Timing the Stock Market with the Shiller CAPE Ratio
The Shiller CAPE ratio is typically regarded as a stock market valuation measure. But the CAPE itself is not a good stock market timer. However, it can be indirectly used for market timing by determining a cycle-ID as formulated by Theodore Wong.
Why Every Investor Should Own Gold
John Hathaway is chairman of Tocqueville Management Corporation, the general partner of Tocqueville Management L.P. He co-manages the Tocqueville Gold Fund (TGLDX). I spoke with John on December 9
Weighing the Week Ahead: New Year, New Highs, and a New List of Worries
There is a normal dose of economic data this week, but we are entering a quiet, pre-holiday period. As the rally faltered a bit, the Dow 20K talk yielded to a discussion of what could go wrong.