So far, 2016 has been full of surprises, but most of the attention has gone to wildly volatile oil and stock prices. Less noticed, but equally important, has been the boost on bond prices, as seen by the dramatic fall in bond yields. The 10-year US Treasury note, the bellwether benchmark, started out the year yielding 2.27 percent, 10 basis points (a basis point is one hundredth of one percent)… Read More
Yesterday’s insight on drawdowns was quite popular and enough people asked for the same thing, so I thought I would do an immediate update. (Click here for the original post.) The first request was for the full history of the S&P 500 since yesterday’s chart only went back 25 years. I picked 25 years somewhat randomly, but mostly because the other chart that went with it was difficult to read going… Read More
Until I read the book ‘Hedge Hogging’ by Barton Biggs before the 2008 financial crisis, I had never heard the term ‘drawdown,’ which refers to the peak-to-trough decline of an investment or market. A drawdown measures the depth and length of a decline and illustrates how long it takes to earn back money lost from the last peak. It’s a commonly used term in the hedge fund community, partly because… Read More
We are pleased to provide a digital copy of Portfolio Insights, our quarterly newsletter. Table of Contents: Stock Market Summary Bond Market Review The Fed Awakens Volatility Strikes Back Click here to read the issue: 2015 Q4 Portfolio Insights
Yesterday I posted some of the questions and answers from the Barron’s annual ‘Test Your Wall Street Skills’ quiz. Here’s a link to my article from yesterday and here is the link to the article in Barron’s (a subscription may be required). Most of the ‘big’ questions have already been answered, but there are still some fun ones: 1. Which ‘FANG’ stocks will fare worst in 2016 – Facebook, Amazon,… Read More
Over the weekend, Barron’s put out their annual quiz for readers to predict market related events in the coming year (you can find the quiz here, but a subscription may be required). I thought it would be fun to share some of my answers – but keep in mind the quote from Warren Buffet, who said that ‘the only value of stock forecasters is to make fortune-tellers look good.’ I… Read More
One of my favorite long-timer readers asked me today to follow up on the chart from yesterday to include the performance of energy stocks (click here to see yesterday’s chart). The best quality sector data from S&P only dates back to 1989, so this data set isn’t quite as long as what I showed yesterday, but the story is basically the same and I have to admit that I was surprised… Read More
Although oil ultimately finished higher yesterday, West Texas Intermediate (WTI) crude touched on a 2004 low during the day. I know I am repeating myself, but I continue to be surprised by how far oil has dropped in the last 18 months. As you know, I think a chart is worth 1,000 words, so I’ve plotted the spot price for WTI as far back as my Bloomberg data would take… Read More
Last Thursday, Mario Draghi, the President of the European Central Bank (ECB) disappointed markets by not increasing their current bond buying program. It was a shock to markets, although you wouldn’t really know it from looking at the stock market. The S&P 500 lost -1.44 percent, and while that’s a fair amount, it definitely falls in the normal category and not in the shocking category. The real action was in the… Read More
Back in 1995, I subscribed to the big industry rag for stock brokers, Registered Rep Magazine. Twenty years later, I still get the magazine, although I haven’t held a broker’s license (the Series 7) for more than a decade. When I sat down to read it a few days ago, I was struck by one of the articles, which said that the popular Social Security maximization strategy, File and Suspend,… Read More
