Growth stock wobbles

Mid-week market update: One of the defining characteristics of the current bull run is the dominance of US large cap growth stocks. Joe Wiesenthal wrote about the problem of the effect of the "superstar companies" on the economy in a Twitter thread and in a Bloomberg commentary. The "superstar companies" have few employees, and therefore high labor...

Here’s a way to energize your portfolio

Ho hum, another record in the major market indices. If you want to play catch-up, here is a lower risk idea to energize your portfolio. The most recent BoA Global Fund Manager Survey showed that managers are dramatically underweight energy stocks. The sector is hated, unloved, and beaten up.     Whether you are bullish...

Can a bull market begin without the banks?

Earnings season has kicked off with reports from the major banks. The market reaction has been mixed so far. From a big picture perspective, history shows that whenever the relative performance of banking stocks have breached a major support level, such events have usually signaled periods of financial stress and bear markets.     This...

Is this the long awaited value investing revival?

Preface: Explaining our market timing models We maintain several market timing models, each with differing time horizons. The "Ultimate Market Timing Model" is a long-term market timing model based on the research outlined in our post, Building the ultimate market timing model. This model tends to generate only a handful of signals each decade. The...

Peering into 2020: New decade, new paradigm

Preface: Explaining our market timing models We maintain several market timing models, each with differing time horizons. The "Ultimate Market Timing Model" is a long-term market timing model based on the research outlined in our post, Building the ultimate market timing model. This model tends to generate only a handful of signals each decade. The...

The path to a European Renaissance

Preface: Explaining our market timing models We maintain several market timing models, each with differing time horizons. The "Ultimate Market Timing Model" is a long-term market timing model based on the research outlined in our post, Building the ultimate market timing model. This model tends to generate only a handful of signals each decade. The...

How to buy “smart” Value

Value investing has taken it on the chin in the last decade, as the style has badly lagged the market. Callum Thomas documented how value discount has grown over the last decade. The discount has fallen to levels last seen at the height of the NASDAQ Bubble, when internet related stocks came crashing to earth,...

Goldman’s “The death of value” and what being contrarian means

Recently, Ben Snider at Goldman Sachs published a report entitled "The Death of Value", which suggested that the value style is likely to face further short-term headwinds. Specifically, Snider referred to the Fama-French value factor, which had seen an unbelievable run from 1940 to 2010 (charts via Value Walk).     Goldman Sachs went on...

How Buffett’s business empire could unravel

Josh Brown had a terrific comment about the secret of Warren Buffett's success. Buffett is unabashedly "permabullish" on America: One of the hallmarks of Berkshire’s success has been its willingness to raise or lower its formidable cash hoard in response to the presence (or lack thereof) of viable investing opportunities. One of the other hallmarks...

Where I am finding value in today’s market

I was playing around with Relative Rotation Graphs (RRG) on the weekend with a focus on changes in sector leadership (see my previous post RIP Recession. Reflationary resurrection next?). RRG charts measure how a stock or sector is performing relative to a benchmark on a short and long term basis as a way of better understanding...