Thursday 7 April 2011
Jim Rogers `Short' Emerging Market, Nasdaq Stocks March 2011
All information on this website is for educational purposes only and is not intended to provide financial advise. Any statements about profits or income, expressed or implied, does not represent a guarantee. Your actual trading may result in losses as no trading system is guaranteed. You accept full responsibilities for your actions, trades, profit or loss, and agree to hold MinKL Invest harmless in any and all ways.
Steve Nison's Highlights Newsletter: Hammers and Trend
All information on this website is for educational purposes only and is not intended to provide financial advise. Any statements about profits or income, expressed or implied, does not represent a guarantee. Your actual trading may result in losses as no trading system is guaranteed. You accept full responsibilities for your actions, trades, profit or loss, and agree to hold MinKL Invest harmless in any and all ways.
Jesse Ventura: Enough Government Cover-ups! It's time for a Revolution!
All information on this website is for educational purposes only and is not intended to provide financial advise. Any statements about profits or income, expressed or implied, does not represent a guarantee. Your actual trading may result in losses as no trading system is guaranteed. You accept full responsibilities for your actions, trades, profit or loss, and agree to hold MinKL Invest harmless in any and all ways.
Weekly forecast and outlook for financial market 28/3-1/4 | Trading Energy
Weekly forecast and outlook for financial market 28/3-1/4 | Trading Energy
All information on this website is for educational purposes only and is not intended to provide financial advise. Any statements about profits or income, expressed or implied, does not represent a guarantee. Your actual trading may result in losses as no trading system is guaranteed. You accept full responsibilities for your actions, trades, profit or loss, and agree to hold MinKL Invest harmless in any and all ways.
All information on this website is for educational purposes only and is not intended to provide financial advise. Any statements about profits or income, expressed or implied, does not represent a guarantee. Your actual trading may result in losses as no trading system is guaranteed. You accept full responsibilities for your actions, trades, profit or loss, and agree to hold MinKL Invest harmless in any and all ways.
Gold & Silver Prices Outlook –6 April
Let’s examine the news and events that might affect current gold and silver prices as of April 6th:
China raised its interest rate
Bank of China raise its basic interest rate by 25 basis points to 6.31%. This is the second interest rate raise this year. This decision was taken to slow down China’s growing inflation, which as of February 2011 reached 4.9% annual rate.
China is the second largest consumer of gold after India: according to the Gold council recent report pertaining fourth quarter 2010, China’s jewellery demand reached a new annual record of 400 tons, and its annual demand for bars and coins totaled 179.9 tons – an increase of 70% (Y-2-Y).
The recent rise in interest rate might adversely affect its demand for precious metals, such as gold and silver. If it will have such an affect, it will be felt in the upcoming months.
Turmoil in Middle East – update
The fights between the rebels and Gaddafi’s army progresses and even with NATO’s intervention the fights don’t subside.
This turmoil raises the instability in the Middle East and adversely affects the market of commodities and precious metals.
See here for more news and updates about the turmoil in the Middle East and its affect on commodities’ markets.
Gold and silver prices April 2011
The month of April started off with rises for gold and silver prices. During March silver prices rose by over 10% while gold prices didn’t do much.
In the chart below are the changes of gold prices during 2011; the chart shows that gold pricesbounced back from its decline during January.
The gold to silver ratio: as of yesterday, April 5th the ratio between gold and silver pricesdeclined to 37.07 – the lowest level this month so far.
As seen in the graph below, the ratio of gold to silver prices continue to drop as silver pricesincrease by a higher rate than gold prices do
China raised its interest rate
Bank of China raise its basic interest rate by 25 basis points to 6.31%. This is the second interest rate raise this year. This decision was taken to slow down China’s growing inflation, which as of February 2011 reached 4.9% annual rate.
China is the second largest consumer of gold after India: according to the Gold council recent report pertaining fourth quarter 2010, China’s jewellery demand reached a new annual record of 400 tons, and its annual demand for bars and coins totaled 179.9 tons – an increase of 70% (Y-2-Y).
The recent rise in interest rate might adversely affect its demand for precious metals, such as gold and silver. If it will have such an affect, it will be felt in the upcoming months.
Turmoil in Middle East – update
The fights between the rebels and Gaddafi’s army progresses and even with NATO’s intervention the fights don’t subside.
This turmoil raises the instability in the Middle East and adversely affects the market of commodities and precious metals.
See here for more news and updates about the turmoil in the Middle East and its affect on commodities’ markets.
Gold and silver prices April 2011
The month of April started off with rises for gold and silver prices. During March silver prices rose by over 10% while gold prices didn’t do much.
In the chart below are the changes of gold prices during 2011; the chart shows that gold pricesbounced back from its decline during January.
The gold to silver ratio: as of yesterday, April 5th the ratio between gold and silver pricesdeclined to 37.07 – the lowest level this month so far.
As seen in the graph below, the ratio of gold to silver prices continue to drop as silver pricesincrease by a higher rate than gold prices do
http://www.tradingnrg.com/gold-prices-forecast-silver-prices-outlook-april-6/
All information on this website is for educational purposes only and is not intended to provide financial advise. Any statements about profits or income, expressed or implied, does not represent a guarantee. Your actual trading may result in losses as no trading system is guaranteed. You accept full responsibilities for your actions, trades, profit or loss, and agree to hold MinKL Invest harmless in any and all ways.
Current crude oil prices moderately rise – April 6 | Trading Energy
Current crude oil prices moderately rise – April 6 | Trading Energy
All information on this website is for educational purposes only and is not intended to provide financial advise. Any statements about profits or income, expressed or implied, does not represent a guarantee. Your actual trading may result in losses as no trading system is guaranteed. You accept full responsibilities for your actions, trades, profit or loss, and agree to hold MinKL Invest harmless in any and all ways.
Oil prices moderately rise – April 6
Yesterday, crude oil prices (WTI and Brent oil) moderately inclined; gold and silver prices continue their rally; natural gas spot price (Henry Hub) continues to zigzag as it declined yesterday.
Here is a short summary of the price changes in major energy commodities and precious metals for April 6th:
Oil and Gas prices:
Crude oil price (WTI spot) moderately inclined yesterday by 0.45% and reached 108.83$/b.
Brent spot price also rose by 0.47% to reach 121.93$/b.
As a result, the difference between Brent and WTI rose and reached at 13.10$/b.
Natural gas spot price (Henry Hub) continues to zigzag and declined yesterday by a 0.95% to reach 4.18$/mmbtu.
The Henry Hub future price, continue to decline by 1.89% to reach 4.15$/mmbtu, resulting in the spread between future and spot price reaching to -0.03$/mmbtu, i.e. backwardation.
Precious Metals prices:
Gold prices inclined by 0.41% and reached 1,458$; silver prices also inclined by 0.52% and reached 39.39$. During April, gold prices increased by 2.1%, and silver prices by 4.4%.
EURO/ USD moderately increased as the USD depreciated yesterday by 0.7%. For a more detailed report on major currencies, check out Forex crunch.
A summary of yesterday’s Prices Changes:
The table below includes: closing prices, daily percent change, and change in US dollars (except for USD/CAD, in which the change is in Canadian dollars):
All information on this website is for educational purposes only and is not intended to provide financial advise. Any statements about profits or income, expressed or implied, does not represent a guarantee. Your actual trading may result in losses as no trading system is guaranteed. You accept full responsibilities for your actions, trades, profit or loss, and agree to hold MinKL Invest harmless in any and all ways.
Stock Trader's Almanac 2011
ISBN: 978-0-470-55744-0
Hardcover
196 pages
October 2010
10 2011 Strategy Calendar.
12 January Almanac.
14 January’s First Five Days: An “Early Warning” System.
16 The Incredible January Barometer (Devised 1972): Only Six Significant Errors in 60 Years.
18 January Barometer in Graphic Form Since 1950.
20 Hot January Industries Beat S&P 500 Next 11 Months.
22 February Almanac.
24 1933 “Lame Duck” Amendment: Reason January Barometer Works.
26 The First Year of Decades.
28 Market Charts of Pre-Presidential Election Years.
30 March Almanac.
32 Pre-Presidential Election Years: No Losers in 72 Years.
34 Why a 50% Gain in the Dow is Possible from its 2010 Low to its 2011 High.
36 Next Super Boom–Dow 38820 By 2025.
38 April Almanac.
40 The December Low Indicator: A Useful Prognosticating Tool.
42 Down Januarys: A Remarkable Record.
44 Top Performing Months Past 601/3 Years: Standard & Poor’s 500 and Dow Jones Industrials.
46 May Almanac.
48 Best Six Months: Still An Eye-Popping Strategy.
50 MACD-Timing Triples “Best Six Months” Results.
52 Take Advantage of Down Friday/Down Monday Warning.
54 Top Performing NASDAQ Months Past 391/3 Years.
56 June Almanac.
58 Get More out of NASDAQ’s “Best Eight Months” with MACD-Timing.
60 Triple Returns, Fewer Trades: Best 6 + 4-Year Cycle.
62 First-Trading-Day-Of-The-Month Phenomenon: Dow Gains More One Day than All Other Days.
64 July Almanac.
66 2009 Daily Dow Point Changes.
68 Don’t Sell Stocks on Monday or Friday.
70 A Rally for All Seasons.
72 First Month of Quarters Is the Most Bullish.
74 August Almanac.
76 Aura of the Triple Witch—4th Quarter Most Bullish: Down Weeks Trigger More Weakness Week After.
78 What To Trade During Best and Worst Months.
80 A Correction for All Seasons.
82 September Almanac.
84 Market Behavior Three Days before and Three Days after Holidays.
86 Fourth Quarter Market Magic.
88 Market Gains More on Super-8 Days Each Month.
Than on All 13 Remaining Days Combined.
90 October Almanac.
92 Sector Seasonality: Selected Percentage Plays.
94 Sector Index Seasonality Strategy Calendar.
98 Trading the Thanksgiving Market.
100 November Almanac.
102 Most of the So-Called “January Effect” Takes Place in the Last Half of December.
104 January Effect Now Starts in Mid-December.
106 Wall Street’s Only Free Lunch Served before Christmas.
108 December Almanac.
110 If Santa Claus Should Fail to Call, Bears May Come to Broad and Wall.
112 Best Investment Book of the Year: Far From Random.
114 Year’s Top Investment Books.
118 2012 Strategy Calendar.
DIRECTORY OF TRADING PATTERNS AND DATABANK.
121 Dow Jones Industrials Market Probability Calendar 2011.
122 Recent Dow Jones Industrials Market Probability Calendar 2011.
123 S&P 500 Market Probability Calendar 2011.
124 Recent S&P 500 Market Probability Calendar 2011.
125 NASDAQ Market Probability Calendar 2011.
126 Recent NASDAQ Market Probability Calendar 2011.
127 Russell 1000 Index Market Probability Calendar 2011.
128 Russell 2000 Index Market Probability Calendar 2011.
129 Decennial Cycle: A Market Phenomenon.
130 Presidential Election/Stock Market Cycle: The 177-Year Saga Continues.
131 Dow Jones Industrials Bull and Bear Markets Since 1900.
132 Standard & Poor’s 500 Bull and Bear Markets Since 1929/NASDAQ Composite Since 1971.
133 Dow Jones Industrials 10-Year Daily Point Changes: January and February.
134 Dow Jones Industrials 10-Year Daily Point Changes: March and April.
135 Dow Jones Industrials 10-Year Daily Point Changes: May and June.
136 Dow Jones Industrials 10-Year Daily Point Changes: July and August.
137 Dow Jones Industrials 10-Year Daily Point Changes: September and October.
138 Dow Jones Industrials 10-Year Daily Point Changes: November and December.
139 A Typical Day in the Market.
140 Through the Week on a Half-Hourly Basis.
141 Tuesday Most Profitable Day of Week.
142 NASDAQ Strongest Last 3 Days of Week.
143 S&P Daily Performance Each Year Since 1952.
144 NASDAQ Daily Performance Each Year Since 1971.
145 Monthly Cash Inflows into S&P Stocks.
146 Monthly Cash Inflows into NASDAQ Stocks.
147 November, December, and January: Year’s Best Three-Month Span.
148 November Through June: NASDAQ’s Eight-Month Run.
149 Dow Jones Industrials Annual Highs, Lows, and Closes Since 1901.
150 Standard & Poor’s 500 Annual Highs, Lows, and Closes Since 1930.
151 NASDAQ, Russell 1000, and 2000 Annual Highs, Lows, and Closes Since 1971.
152 Dow Jones Industrials Monthly Percent Changes Since 1950.
153 Dow Jones Industrials Monthly Point Changes Since 1950.
154 Dow Jones Industrials Monthly Closing Prices Since 1950.
155 Standard & Poor’s 500 Monthly Percent Changes Since 1950.
156 Standard & Poor’s 500 Monthly Closing Prices Since 1950.
157 NASDAQ Composite Monthly Percent Changes Since 1971.
158 NASDAQ Composite Monthly Closing Prices Since 1971.
159 Russell 1000 Monthly Percent Changes and Closing Prices Since 1979.
160 Russell 2000 Monthly Percent Changes and Closing Prices Since 1979.
161 10 Best Days by Point and Percent.
162 10 Worst Days by Point and Percent.
163 10 BestWeeks by Point and Percent.
164 10 WorstWeeks by Point and Percent.
165 10 Best Months by Point and Percent.
166 10 Worst Months by Point and Percent.
167 10 Best Quarters by Point and Percent.
168 10 Worst Quarters by Point and Percent.
169 10 BestYears by Point and Percent.
170 10 WorstYears by Point and Percent.
STRATEGY PLANNING AND RECORD SECTION.
172 Portfolio at Start of 2011.
173 Additional Purchases.
175 Short-Term Transactions.
177 Long-Term Transactions.
179 Interest/Dividends Received during 2011/Brokerage Account Data 2011.
180 Weekly Portfolio Price Record 2011.
182 Weekly Indicator Data 2011.
184 Monthly Indicator Data 2011.
185 Portfolio at End of 2011.
186 If You Don’t Profit from Your Investment Mistakes, Someone Else Will; Performance Record of Recommendations.
187 Individual Retirement Account (IRA): Most Awesome Mass Investment Incentive Ever Devised.
188 Top 300 Exchange Traded Funds (ETFs).
190 Option Trading Codes.
191 G. M. Loeb’s “Battle Plan” for Investment Survival.
192 G. M. Loeb’s Investment Survival Checklist.
http://as.wiley.com/WileyCDA/WileyTitle/productCd-0470557443,descCd-tableOfContents.html
All information on this website is for educational purposes only and is not intended to provide financial advise. Any statements about profits or income, expressed or implied, does not represent a guarantee. Your actual trading may result in losses as no trading system is guaranteed. You accept full responsibilities for your actions, trades, profit or loss, and agree to hold MinKL Invest harmless in any and all ways.
Crude oil tends to continue its rally through April
Dow: 66.7% S&P: 61.9% NAS: 52.4% R1K: 61.9% R2K: 57.1%
Every spring I begin to get a little nervous about the stock market as my market seasonality clock starts thumping as the end of the Best Six Months (November-April) is nigh. This anxiety builds when the calendar rolls into April. If the market has been on binge as it has this year, as well as the last seven months – and the last two years for that matter this feeling of vertigo intensifies.
The recent exuberant sentiment readings from the venerable Investors Intelligence service are adding to my feelings of apprehension. In their Advisors Sentiment note this morning Mike Burke and John Gray observed that:
"The bulls moved up to 57.3% from 51.6% last week and their recent low at 50.6% just prior to that. The new increase in bullishness is not a good sign as it signals more funds moving off the sidelines and into stocks. This is the most bulls since mid-December when we counted 58.8%. At the end of last August’s market lows the bulls were as few as 29.4%, suggesting a time to buy. The latest reading suggests increased danger. At the October 2007 top the bulls were 62.0%.
"After a 7.4% drop the bears were down to 15.7%. They were 23.1% a week ago. The current negative reading below 20% is a low since mid-December 2009 when they were 15.6%. Low levels for the bears say there is not much cash left on the sidelines.
"The remaining advisors, classified as correction, rose to 27.0% from 25.3% last week. That category has been in a tight 5% range for the past 8-weeks, at fairly high levels. Some nervous bulls have shifted back and forth into this camp, avoiding outright negative projections.
"The difference between the bulls and bears jumped to +41.6%, a negative level. Last week it was +28.5% and contracting in the right direction for more stock gains. This latest reading is close to the +42.4% spread that accompanied the all-time market peak from October 2007. This is bearish."
We remain vigilant for our Seasonal Sell Signal and on increasingly high alert for a deeper correction.
http://blog.stocktradersalmanac.com/post/Frothy-Sentiment
All information on this website is for educational purposes only and is not intended to provide financial advise. Any statements about profits or income, expressed or implied, does not represent a guarantee. Your actual trading may result in losses as no trading system is guaranteed. You accept full responsibilities for your actions, trades, profit or loss, and agree to hold MinKL Invest harmless in any and all ways.
Every spring I begin to get a little nervous about the stock market as my market seasonality clock starts thumping as the end of the Best Six Months (November-April) is nigh. This anxiety builds when the calendar rolls into April. If the market has been on binge as it has this year, as well as the last seven months – and the last two years for that matter this feeling of vertigo intensifies.
The recent exuberant sentiment readings from the venerable Investors Intelligence service are adding to my feelings of apprehension. In their Advisors Sentiment note this morning Mike Burke and John Gray observed that:
"The bulls moved up to 57.3% from 51.6% last week and their recent low at 50.6% just prior to that. The new increase in bullishness is not a good sign as it signals more funds moving off the sidelines and into stocks. This is the most bulls since mid-December when we counted 58.8%. At the end of last August’s market lows the bulls were as few as 29.4%, suggesting a time to buy. The latest reading suggests increased danger. At the October 2007 top the bulls were 62.0%.
"After a 7.4% drop the bears were down to 15.7%. They were 23.1% a week ago. The current negative reading below 20% is a low since mid-December 2009 when they were 15.6%. Low levels for the bears say there is not much cash left on the sidelines.
"The remaining advisors, classified as correction, rose to 27.0% from 25.3% last week. That category has been in a tight 5% range for the past 8-weeks, at fairly high levels. Some nervous bulls have shifted back and forth into this camp, avoiding outright negative projections.
"The difference between the bulls and bears jumped to +41.6%, a negative level. Last week it was +28.5% and contracting in the right direction for more stock gains. This latest reading is close to the +42.4% spread that accompanied the all-time market peak from October 2007. This is bearish."
We remain vigilant for our Seasonal Sell Signal and on increasingly high alert for a deeper correction.
http://blog.stocktradersalmanac.com/post/Frothy-Sentiment
All information on this website is for educational purposes only and is not intended to provide financial advise. Any statements about profits or income, expressed or implied, does not represent a guarantee. Your actual trading may result in losses as no trading system is guaranteed. You accept full responsibilities for your actions, trades, profit or loss, and agree to hold MinKL Invest harmless in any and all ways.
Crude oil tends to continue its rally through April
Dow: 66.7% S&P: 61.9% NAS: 52.4% R1K: 61.9% R2K: 57.1%
Every spring I begin to get a little nervous about the stock market as my market seasonality clock starts thumping as the end of the Best Six Months (November-April) is nigh. This anxiety builds when the calendar rolls into April. If the market has been on binge as it has this year, as well as the last seven months – and the last two years for that matter this feeling of vertigo intensifies.
The recent exuberant sentiment readings from the venerable Investors Intelligence service are adding to my feelings of apprehension. In their Advisors Sentiment note this morning Mike Burke and John Gray observed that:
"The bulls moved up to 57.3% from 51.6% last week and their recent low at 50.6% just prior to that. The new increase in bullishness is not a good sign as it signals more funds moving off the sidelines and into stocks. This is the most bulls since mid-December when we counted 58.8%. At the end of last August’s market lows the bulls were as few as 29.4%, suggesting a time to buy. The latest reading suggests increased danger. At the October 2007 top the bulls were 62.0%.
"After a 7.4% drop the bears were down to 15.7%. They were 23.1% a week ago. The current negative reading below 20% is a low since mid-December 2009 when they were 15.6%. Low levels for the bears say there is not much cash left on the sidelines.
"The remaining advisors, classified as correction, rose to 27.0% from 25.3% last week. That category has been in a tight 5% range for the past 8-weeks, at fairly high levels. Some nervous bulls have shifted back and forth into this camp, avoiding outright negative projections.
"The difference between the bulls and bears jumped to +41.6%, a negative level. Last week it was +28.5% and contracting in the right direction for more stock gains. This latest reading is close to the +42.4% spread that accompanied the all-time market peak from October 2007. This is bearish."
We remain vigilant for our Seasonal Sell Signal and on increasingly high alert for a deeper correction.
http://blog.stocktradersalmanac.com/post/Frothy-Sentiment
All information on this website is for educational purposes only and is not intended to provide financial advise. Any statements about profits or income, expressed or implied, does not represent a guarantee. Your actual trading may result in losses as no trading system is guaranteed. You accept full responsibilities for your actions, trades, profit or loss, and agree to hold MinKL Invest harmless in any and all ways.
Every spring I begin to get a little nervous about the stock market as my market seasonality clock starts thumping as the end of the Best Six Months (November-April) is nigh. This anxiety builds when the calendar rolls into April. If the market has been on binge as it has this year, as well as the last seven months – and the last two years for that matter this feeling of vertigo intensifies.
The recent exuberant sentiment readings from the venerable Investors Intelligence service are adding to my feelings of apprehension. In their Advisors Sentiment note this morning Mike Burke and John Gray observed that:
"The bulls moved up to 57.3% from 51.6% last week and their recent low at 50.6% just prior to that. The new increase in bullishness is not a good sign as it signals more funds moving off the sidelines and into stocks. This is the most bulls since mid-December when we counted 58.8%. At the end of last August’s market lows the bulls were as few as 29.4%, suggesting a time to buy. The latest reading suggests increased danger. At the October 2007 top the bulls were 62.0%.
"After a 7.4% drop the bears were down to 15.7%. They were 23.1% a week ago. The current negative reading below 20% is a low since mid-December 2009 when they were 15.6%. Low levels for the bears say there is not much cash left on the sidelines.
"The remaining advisors, classified as correction, rose to 27.0% from 25.3% last week. That category has been in a tight 5% range for the past 8-weeks, at fairly high levels. Some nervous bulls have shifted back and forth into this camp, avoiding outright negative projections.
"The difference between the bulls and bears jumped to +41.6%, a negative level. Last week it was +28.5% and contracting in the right direction for more stock gains. This latest reading is close to the +42.4% spread that accompanied the all-time market peak from October 2007. This is bearish."
We remain vigilant for our Seasonal Sell Signal and on increasingly high alert for a deeper correction.
http://blog.stocktradersalmanac.com/post/Frothy-Sentiment
All information on this website is for educational purposes only and is not intended to provide financial advise. Any statements about profits or income, expressed or implied, does not represent a guarantee. Your actual trading may result in losses as no trading system is guaranteed. You accept full responsibilities for your actions, trades, profit or loss, and agree to hold MinKL Invest harmless in any and all ways.
Crude oil tends to continue its rally through April
Dow: 66.7% S&P: 61.9% NAS: 52.4% R1K: 61.9% R2K: 57.1%
Every spring I begin to get a little nervous about the stock market as my market seasonality clock starts thumping as the end of the Best Six Months (November-April) is nigh. This anxiety builds when the calendar rolls into April. If the market has been on binge as it has this year, as well as the last seven months – and the last two years for that matter this feeling of vertigo intensifies.
The recent exuberant sentiment readings from the venerable Investors Intelligence service are adding to my feelings of apprehension. In their Advisors Sentiment note this morning Mike Burke and John Gray observed that:
"The bulls moved up to 57.3% from 51.6% last week and their recent low at 50.6% just prior to that. The new increase in bullishness is not a good sign as it signals more funds moving off the sidelines and into stocks. This is the most bulls since mid-December when we counted 58.8%. At the end of last August’s market lows the bulls were as few as 29.4%, suggesting a time to buy. The latest reading suggests increased danger. At the October 2007 top the bulls were 62.0%.
"After a 7.4% drop the bears were down to 15.7%. They were 23.1% a week ago. The current negative reading below 20% is a low since mid-December 2009 when they were 15.6%. Low levels for the bears say there is not much cash left on the sidelines.
"The remaining advisors, classified as correction, rose to 27.0% from 25.3% last week. That category has been in a tight 5% range for the past 8-weeks, at fairly high levels. Some nervous bulls have shifted back and forth into this camp, avoiding outright negative projections.
"The difference between the bulls and bears jumped to +41.6%, a negative level. Last week it was +28.5% and contracting in the right direction for more stock gains. This latest reading is close to the +42.4% spread that accompanied the all-time market peak from October 2007. This is bearish."
We remain vigilant for our Seasonal Sell Signal and on increasingly high alert for a deeper correction.
http://blog.stocktradersalmanac.com/post/Frothy-Sentiment
All information on this website is for educational purposes only and is not intended to provide financial advise. Any statements about profits or income, expressed or implied, does not represent a guarantee. Your actual trading may result in losses as no trading system is guaranteed. You accept full responsibilities for your actions, trades, profit or loss, and agree to hold MinKL Invest harmless in any and all ways.
Every spring I begin to get a little nervous about the stock market as my market seasonality clock starts thumping as the end of the Best Six Months (November-April) is nigh. This anxiety builds when the calendar rolls into April. If the market has been on binge as it has this year, as well as the last seven months – and the last two years for that matter this feeling of vertigo intensifies.
The recent exuberant sentiment readings from the venerable Investors Intelligence service are adding to my feelings of apprehension. In their Advisors Sentiment note this morning Mike Burke and John Gray observed that:
"The bulls moved up to 57.3% from 51.6% last week and their recent low at 50.6% just prior to that. The new increase in bullishness is not a good sign as it signals more funds moving off the sidelines and into stocks. This is the most bulls since mid-December when we counted 58.8%. At the end of last August’s market lows the bulls were as few as 29.4%, suggesting a time to buy. The latest reading suggests increased danger. At the October 2007 top the bulls were 62.0%.
"After a 7.4% drop the bears were down to 15.7%. They were 23.1% a week ago. The current negative reading below 20% is a low since mid-December 2009 when they were 15.6%. Low levels for the bears say there is not much cash left on the sidelines.
"The remaining advisors, classified as correction, rose to 27.0% from 25.3% last week. That category has been in a tight 5% range for the past 8-weeks, at fairly high levels. Some nervous bulls have shifted back and forth into this camp, avoiding outright negative projections.
"The difference between the bulls and bears jumped to +41.6%, a negative level. Last week it was +28.5% and contracting in the right direction for more stock gains. This latest reading is close to the +42.4% spread that accompanied the all-time market peak from October 2007. This is bearish."
We remain vigilant for our Seasonal Sell Signal and on increasingly high alert for a deeper correction.
http://blog.stocktradersalmanac.com/post/Frothy-Sentiment
All information on this website is for educational purposes only and is not intended to provide financial advise. Any statements about profits or income, expressed or implied, does not represent a guarantee. Your actual trading may result in losses as no trading system is guaranteed. You accept full responsibilities for your actions, trades, profit or loss, and agree to hold MinKL Invest harmless in any and all ways.
Stock Trader's Almanac Blog
Stock Trader's Almanac Blog
Dow: 52.4% S&P: 61.9% NAS: 71.4% R1K: 66.7% R2K: 52.4%
All information on this website is for educational purposes only and is not intended to provide financial advise. Any statements about profits or income, expressed or implied, does not represent a guarantee. Your actual trading may result in losses as no trading system is guaranteed. You accept full responsibilities for your actions, trades, profit or loss, and agree to hold MinKL Invest harmless in any and all ways.
April is the Best Month for the Dow, Average 2.0% Gain Since 1950, 3rd Best Month for S&P, 4th Best for NASDAQ (Since 1971)
Dow: 52.4% S&P: 61.9% NAS: 71.4% R1K: 66.7% R2K: 52.4%"The common denominator: Something that matters! Something that counts! Something that defines! Something that is imbued with soul. And with life!"
All information on this website is for educational purposes only and is not intended to provide financial advise. Any statements about profits or income, expressed or implied, does not represent a guarantee. Your actual trading may result in losses as no trading system is guaranteed. You accept full responsibilities for your actions, trades, profit or loss, and agree to hold MinKL Invest harmless in any and all ways.
How Peter Lynch Destroyed the Market
By Anand Chokkavelu, CFA | More Articles
May 21, 2010 | Comments (30)
Peter Lynch didn't just beat the Street ... he absolutely destroyed it.
Reflect on his record for a second. Lynch ran Fidelity's Magellan Fund from 1977 to 1990, beating the S&P 500 in all but two of those years. He averaged annual returns of 29%. That's a mind-blowing figure. It means that $1 grew to more than $27; if you invested as little as $37,000 with him in 1977, you were a millionaire in 1990.
Fortunately for us, he's willing to share his secrets. To achieve his stunning track record, he clung to eight simple principles. Here they are.
1. Know what you own
Seems elementary, right? But as someone who talks to lots of investors, I can report that you'd be shocked at how few investors actually do their research. Scroll down to No. 7 for a good first step in getting ahead of the game.
Seems elementary, right? But as someone who talks to lots of investors, I can report that you'd be shocked at how few investors actually do their research. Scroll down to No. 7 for a good first step in getting ahead of the game.
2. It's futile to predict the economy and interest rates (so don't waste time trying)
After 2008's crash, I noticed a distinct increase in armchair economists. We financial types do enjoy water cooler talk about interest rates, trade deficits, debt levels, etc. But there's a danger in converting thought into action.
After 2008's crash, I noticed a distinct increase in armchair economists. We financial types do enjoy water cooler talk about interest rates, trade deficits, debt levels, etc. But there's a danger in converting thought into action.
The U.S. economy is an extraordinarily complex system, with 300 million people acting in their own self-interest and responding to each others' actions, government incentives, and external shocks. And that's before we factor in our increasingly frequent interactions with the rest of the world.
Trying to time the market is futile. Set up a financial plan that allocates your assets based on your risk tolerance, so that you can sleep at night.
3. You have plenty of time to identify and recognize exceptional companies
Lynch mentions that Wal-Mart (NYSE: WMT ) was a 10-bagger -- i.e. its stock rose to 10 times its initial price -- 10 years after it went public. Even if you had gotten in after waiting a decade, though, you'd be sitting on a 100-bagger.
Lynch mentions that Wal-Mart (NYSE: WMT ) was a 10-bagger -- i.e. its stock rose to 10 times its initial price -- 10 years after it went public. Even if you had gotten in after waiting a decade, though, you'd be sitting on a 100-bagger.
Some would argue that it's still not too late to get in on Wal-Mart, decades after going public. While the company's no longer a monster growth story, it continues to crank out 20% returns on equity year after year. That type of consistent ROE is a huge positive indicator of management's ability to effectively allocate capital.
I could tell a similar tale about Microsoft's early growth years, right on down to its still-impressive current return on equity (42%).
And Amazon.com (Nasdaq: AMZN ) , though only 13 years old as a public company, has seen its stock double since its 10th birthday. Of these three, it's the only company still trading at growth-stock valuations. Bulls are hitching their wagon to Amazon.com's ability to expand its role as the premier online retailer, and its upside in the cloud-computing space.
The lesson of Wal-Mart, Microsoft, and Amazon.com? You don't need to immediately jump into the hot stock you just heard about. There's plenty of time to do your research first. See No. 1.
4. Avoid long shots
Lynch claims he was 0-for-25 in investing in companies that had no revenue but a great story. Remember, the guy who averaged 29% returns went oh-fer on long shots. You and I are unlikely to do much better.
Lynch claims he was 0-for-25 in investing in companies that had no revenue but a great story. Remember, the guy who averaged 29% returns went oh-fer on long shots. You and I are unlikely to do much better.
I've said it before, and I'll say it again. Use companies with proven track records as your baseline. ExxonMobil (NYSE: XOM ) , IBM (NYSE: IBM ) , and Procter & Gamble (NYSE:PG ) are selling for 9, 11, and 16 times forward earnings, respectively. This is what the market is charging for solid, low-to-moderate-growth companies that dominate (or at least co-dominate) their spaces. Expect to pay more for higher-growth prospects, but make sure the risk-reward trade-off on an unproven company is worth it.
5. Good management is very important; good businesses matter more
The pithier Lynchism is: "Go for a business that any idiot can run – because sooner or later, any idiot is probably going to run it."
The pithier Lynchism is: "Go for a business that any idiot can run – because sooner or later, any idiot is probably going to run it."
For a prototypical example of a so-easy-a-caveman-could-run-it company, think the aforementioned Procter & Gamble.
6. Be flexible and humble, and learn from mistakes
Lynch has said: "In this business, if you're good, you're right six times out of 10. You're never going to be right nine times out of 10."
Lynch has said: "In this business, if you're good, you're right six times out of 10. You're never going to be right nine times out of 10."
You're going to be wrong. Diversification and the ability to honestly analyze your mistakes are your best tools to minimize the damage.
7. Before you make a purchase, you should be able to explain why you're buying
Specifically, you should be able to explain your thesis in three sentences or less. And in terms an 11-year-old could understand. Once this simply stated thesis starts breaking down, it's time to sell.
Specifically, you should be able to explain your thesis in three sentences or less. And in terms an 11-year-old could understand. Once this simply stated thesis starts breaking down, it's time to sell.
8. There's always something to worry about.
Lynch noted that investors made a killing in the 1950s despite the very new threat of nuclear war. There are plenty of fears to choose from right now, but we've survived a Great Depression, two world wars, an oil crisis, and double-digit inflation.
Lynch noted that investors made a killing in the 1950s despite the very new threat of nuclear war. There are plenty of fears to choose from right now, but we've survived a Great Depression, two world wars, an oil crisis, and double-digit inflation.
Always remember, if our worst fears come true, there'll be a heck of a lot more to worry about than some stock market losses. Lynch's parting shot is that investing is more about stomach than brains.
Peter's principles in action
So there you have it. These are the eight principles Peter Lynch used to bring the market to its knees. They seem simple, but trust me, sticking to them is harder than it sounds.
So there you have it. These are the eight principles Peter Lynch used to bring the market to its knees. They seem simple, but trust me, sticking to them is harder than it sounds.
Our founders, Tom and David Gardner, seek to apply the lessons of the masters -- Lynch, Warren Buffett, et al. in their Stock Advisor newsletter. They take their time and look to identify those truly exceptional companies Peter Lynch talked about.
Tom's recommended Buffett's investment vehicle -- Berkshire Hathaway (NYSE: BRK-A ) (NYSE: BRK-B ) . If you like Lynch's philosophy, you'll like Buffett's as well. In fact, I could have snagged a Buffett quote to support each of the eight principles above.
Meanwhile, David recommended the aforementioned Amazon.com back in 2002 -- in time for a 700% run-up. Both Berkshire and Amazon.com remain core recommendations, and David rates Amazon.com a "Best Buy Now."
If this kind of investing agrees with you, I invite you to join us and see all of David and Tom's recommendations. A 30-day trial is on us. Click here to start.
Anand Chokkavelu owns shares of Microsoft, Exxon, and Berkshire Hathaway. He tips his hat to Kaushal "Ken" Majmudar, JD, CFA of The Ridgewood Group. Amazon.com and Berkshire Hathaway are Motley Fool Stock Advisor selections. Berkshire Hathaway, Microsoft, and Wal-Mart Stores are Motley Fool Inside Value choices. Procter & Gamble is a Motley Fool Income Investor recommendation. Motley Fool Options has recommended a diagonal call position on Microsoft. The Fool owns shares of Berkshire Hathaway and Procter & Gamble. The Fool has a disclosure policy.
http://www.fool.com/investing/general/2010/05/21/how-peter-lynch-destroyed-the-market.aspx
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