23 Mar 2020

From Inside Acropolis

Today, I thought I would cover two topics.  First, I want to update you on how Acropolis is operating, and, second, offer some thoughts on what one prominent economist is saying about the impact of the coronovirus. Regarding Acropolis, it appears that our regular disaster recover preparations were worth their time and energy.  As a Registered Investment Advisor, Acropolis is required to have a disaster recovery plan in place and… Read More

By David Ott Tags: , , ,
2 Mar 2020

We Planned for This

The selloff was mostly driven by concerns about the spread of the coronavirus outside of China.  Although the World Health Organization (WHO) said that it was not yet a pandemic, it increased its risk assessment from ‘high’ to ‘very high.’ Although the bond market received less media attention, the results were equally dramatic.  For reference, the yield on the 10-year US Treasury on January 31st was 1.51 percent.  On Friday,… Read More

By David Ott Tags: , , , ,
8 Apr 2019

The Most Powerful Man in the World?

Last week, Ryan Craft wrote at terrific article, titled ‘The Most Powerful Man in the World,’ which you can read here about the power of Jerome Powell, the current Chair of the Federal Reserve.  It even included a superimposed image of Powell’s face on Superman’s body. I agree with everything that Ryan said, but I couldn’t help but wonder what the leader of the free world might say if he saw that… Read More

By David Ott Tags: , , , ,
14 Jan 2019

Is the Market Rigged?

When I was in college, I read Liar’s Poker, by Michael Lewis.  It’s the true story of Lewis’ job out of college on the trading floor at Soloman Brothers, the most powerful bond trading firm in the world at that time. Many of the characters like John Meriwether, Lewis Reneri, and John Thain are still staples of the financial media, but no one became more famous than Lewis himself. He’s… Read More

By David Ott Tags: , , ,
24 Dec 2018

Ba Humbug!

Let’s talk about the week that was, as the S&P 500 fell -7.03 percent, on top of the losses of 5.71 percent over the previous two weeks.  All told, the loss for the S&P 500 is now -17.54 percent from the all-time high set on September 20th. Although I don’t follow the Dow Jones Industrial Average (DJIA) closely, I know that many of you do, in part because that’s what’s… Read More

By David Ott Tags: , ,
17 Dec 2018

What’s Driving the Market Lower?

Stocks are suffering for two basic reasons: slowing global growth and tightening central bank policy.  While both of these rationales are true, they’re also very generic. Therefore, I thought it would be interesting to look at the big sectors driving the market performance and try to describe what’s happening in each one for a little more granularity. There are 11 sectors, and I won’t be discussing all of them, because… Read More

By David Ott Tags: , , , , ,
10 Dec 2018

Yield Curve Inversion: What It Means for Investors

Last week, the phrase ‘inverted yield curve’ exploded from the confines of a trading room to the everyday world. It hit me when I went to a holiday cocktail party after work one night and someone said, ‘oh, I heard that the stock market is down because something else is upside down.  I guess the whole world is upside down!’ Before we get into what happened last week, let’s take… Read More

By David Ott Tags: , , ,
29 Oct 2018

Stocks Enter Correction

A correction is usually defined as a peak-to-trough decline of 10- percent using closing prices.  Under that definition, we’re not quite at a correction, since the S&P 500 is ‘only’ down -9.28 percent since the recent high on September 20th. I think that such a strict definition is a little bit silly, so I’m calling it a correction since we’re very close using closing prices, and we crossed the 10-percent… Read More

By David Ott Tags: , , ,
23 Jul 2018

Whither Value? Ask Warren Buffett

I feel as though I’ve written this article a few too many times: value investing is struggling. Pioneered by Warren Buffett’s mentor Benjamin Graham, value investing is the method of buying stocks inexpensively, with the hope that the current problems that’s causing the cheapness pass, and the stock will rebound sharply. Decades into Buffett’s illustrious career, finance academics found that the process of buying cheap stocks led to higher than… Read More

By David Ott Tags: , , , ,
4 Jun 2018

Changes are Coming to the S&P 500

In the old active-versus-passive debate, the S&P 500 serves as the champion fighter in the passive corner.   That’s funny, because the S&P 500 is hardly passive. For example, it’s not a list of the largest 500 companies, but a curated list of stocks chosen by the index committee at Standards & Poor’s.  Most of the differences between the index and the actual list of the largest 500 companies are relatively… Read More

By David Ott Tags: , , ,