15 Apr 2024

Why Are Markets Unhappy Right Now?

As noted above, the March Consumer Price Index (CPI) inflation data exceeded expectations. The year-over-year headline rate was expected to be 3.4 percent but was actually 3.5 percent. The core rate, which excludes food and energy, was expected to be 3.7 percent but was 3.8 percent. Those might not sound like big misses at one-tenth of one percent, but the chart below helps tell the story. The chart shows the… Read More

By David Ott Tags: Economy, Inflation, Interest Rates, Investing, Markets, stock market, Stocks, Wall Street

26 Feb 2024

Japan: The Taylor Swift of Stock Markets?

People often tell me not to worry about the stock market because it ‘always’ comes back. That’s true for the United States and most other developed markets, but for my whole career, it wasn’t true for the Japanese stock market, until now. Last week, the Nikkei 225 price-index crossed a level that it hadn’t seen since 1989. That’s a long, long time. I Googled the most famous person born in… Read More

By David Ott Tags: Diversification, Economy, International Investing, Japan, stock market, Stocks, Volatility, Wall Street

22 Jan 2024

S&P 500 Enjoys Record (Close Back in December)

Woot Woot! We can surely celebrate that the S&P 500 is back at record levels as of last Friday. I updated a few charts (below), and noticed something interesting – actual investors in the S&P 500 were back in the money in mid-December thanks to dividends. I am celebrating as much as the next guy about the price improvement, but dividends are part of the equation, but they are often… Read More

By David Ott Tags: Bear Markets, Dividends, Economy, Investing, Markets, stock market, Stocks, Wall Street

27 Nov 2023

Fooling Yourself with Private Market Math

Private investments, or simply ‘privates’ in the current vernacular, are among the hottest investments in recent years. Private investments, which are often considered one of the most prominent alternative investments, means owning securities that aren’t publicly traded. Private markets can include equity (stocks), credit (bonds), and real estate. Each major group has subcategories. Private equity can be venture capital, buyout equity, or growth equity. Credit can mean direct loans, mezzanine… Read More

By David Ott Tags: commentary, Diversification, Economy, Investing, Markets, Portfolio Strategy, Private Equity, Private Investment, stock market, Volatility, Wall Street

13 Nov 2023

30 Market Timing Signals that Worked

My subject line is taken from an article written by the PhD Head of Investment Research at Dimensional Fund Advisors (DFA), but I cheated and left out the second half of the sentence. Here’s their full headline: We Found 30 Timing Strategies that “Worked” and 690 that Didn’t. I guess I’m not above clickbait, but I also don’t have enough space to get the full headline into the subject line…. Read More

By David Ott Tags: Economy, Investing, Markets, Portfolio Strategy, stock market, Volatility, Wall Street

9 Oct 2023

Active Passive Word Play

I think that most people in the investment business have at one point, or another wrestled with the question about whether the market is efficient and what you should do about it, regardless of your answer. In simple terms, an efficient market quickly incorporates news and information into prices. It’s easy to find examples of market inefficiency, like when companies added .com to their name in the late 1990s and… Read More

By David Ott Tags: Active Investing, commentary, Economy, Efficient Market Hypothesis, Investing, Markets, Passive Investing, Portfolio Strategy, Portfolio Theory, stock market, Wall Street

14 Aug 2023

Thank You Short-Sellers

Growing up, my best friend’s father was a pilot for Ozark Airlines. He seemed like a pretty happy-go-lucky guy who loved flying and golfing when he wasn’t flying. His demeanor changed markedly when Carl Icahn’s backed TWA bought Ozark. I didn’t understand it much then, but I heard terms like ‘corporate raider’ and ‘asset stripping’ at the time. To my friend’s dad, Icahn was a true villain who borrowed money… Read More

By David Ott Tags: Economy, Investing, Markets, Short Selling, stock market, Stocks

12 Jun 2023

The Bond Market is of Mixed Minds about a Recession

One of the things that I hear all the time these days is that the bond market and the stock market aren’t in agreement about whether a recession is coming. Usually, I hear this from someone who thinks that the bond market is right and that the stock market will correct sharply when the recession comes. And in fact, bond investors are giving strong signals of a recession from the… Read More

By David Ott Tags: Economy, Federal Reserve, Interest Rates, Investing, Markets, Recession, stock market, Stocks, Wall Street

5 Jun 2023

The Market Has Bad Breadth

The S&P 500 is up 12.4 percent year-to-date as of Friday, which is excellent news. Less excellent, however, is that just a few stocks are powering the entire return. The half-dozen largest stocks in the index are worth about 25 percent of the index, and they are up 67.9 percent on average. They are all up by over one-third, and two have more than doubled. My back-of-the-envelope calculates that the… Read More

By David Ott Tags: Economy, Investing, Markets, stock market, Stocks, Wall Street

14 Nov 2022

Good News for Stocks & Bonds (Less so, for Crypto)

Stocks were sharply higher last week, more than erasing the prior week’s declines. Although Wednesday suffered a tough selloff of more than two percent, Thursday’s 5.6 percent rally and Friday’s 0.9 percent move higher took the S&P 500 Total Return for the week to 5.9 percent. The big move is easily attributed to the better-than-expected Consumer Price Inflation (CPI) index, which was finally a step in the right direction (more… Read More

By David Ott Tags: Bonds, Economy, Federal Reserve, Inflation, Interest Rates, Investing, Markets, stock market, Volatility, Wall Street

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