September 29, 2015 Perspective
Most investors would have to agree that staying with a long term, logic-driven investment plan during periods of high volatility is not easy. As recently as 2009 while the markets continued their free fall, those investors that could not take the stress any longer threw in the towel and sold out. Almost immediately, as the last sellers exited, equities began their six year run to record highs. As new highs were being toppled on a regular basis, these same investors jumped back in with expectations of continued growth at the previous frantic pace.
August 24, 2015 Perspective
It has been quite some time since we have experienced as volatile a week as we have in the one just passed. For the past twelve months it looked as though the markets were in an “internal” correction. While the major market indexes were remaining within a couple of percentage points from their all-time highs, the broader market was reacting quite differently. Of the 4000 publicly traded stocks, nearly 45% were down more than 20% from their highs. And 24% of all stocks were down more than 40% from their highs. This was all before the selloff that began last week
June 25, 2015 Perspective
We have reached the halfway point for 2015, and if you look at the indexes, most are about where they were at the beginning of the year. Dow +1.6%, S & P 500 +3%, Transportation Index -7%, Utilities -8%, and Corporate Bonds -1%. Bucking the trend is the Smallcap Index +6.5%, the Nasdaq sector +9%, and the International Index at +7%.
March 26, 2015 Perspective
The volatility in the equity markets continues to be present as we alluded to in our February Comment. What is interesting is that this year to date, the leading sectors have flip-flopped from those of the last quarter of 2014. Small and Mid Cap firms are beating the Large Cap stocks at this writing about 6% compared to 2% year to date. The stronger dollar is affecting the exports of the large multinational firms and hurting their bottom line. The smaller companies are not as much affected since most of their sales are in the U.S.
February 19, 2015 Perspective
As tax season quickly approaches, the scramble begins to organize the reams of paper and forms it takes to prepare a return. Add to that frustration the news coming from the IRS that due to budget cuts, their service will be very poor this year and refunds will be delayed, and you get the feeling the system is broken.
October 14, 2014 Perspective
For the past year or so we have opined that we are in a secular bull market which may very well have many years left to run. It has also been stated that during these cycles market values tend to correct every four or five years. Since the beginning of this year the expectation of a 10-12% correction happening sometime this year was very real due to historical odds. With volatility returning to the major market indexes this past week, the question quickly has turned to “are we in a bear market”? To be sure, market moves of more than 1.5% both up and down every day since last Tuesday, investors have become very nervous. In actuality though, the S & P 500 is down 6% from its all-time high less than one month ago.
April 23, 2014 Perspective
The volatility we have seen in the markets over the past month can be chalked up to what analysts call “sector rotation” This occurs when one sector that has generated large gains over the recent period suddenly becomes overvalued in the eyes of traders, and is sold off in a concerted effort to lock in profits. These periods of momentum can last for months or years until, without warning, they are hit hard by profit takers.