Posts Tagged ‘Investors’
Technical Talk: View pullback as buying opportunity
Tuesday, March 9th, 2010
The comments below were provided by Kevin Lane of Fusion IQ.
We said several weeks back that it was hard to see the market top when bullish sentiment surveys were so neutral. Additionally we stated that tops were usually met with exuberant buyers not traders salivating to put on shorts. So here we are several weeks later and two indices - the Nasdaq Composite and the Russell 2000 - are both at new post-market low highs. When the Nasdaq and Russell 2000 are both making highs it again is hard not to maintain a bullish bias.
[Graphs inserted by PduP.]
Source: StockCharts.com
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Source: StockCharts.com
Given that the market has rallied nearly 10% in the last few weeks, expect a shallow to moderate pullback to occur; however, we believe this pullback will present a buying opportunity.
The economic calendar will remain volatile as investors overinterpret every release; however, by and large we believe the economic recovery will continue on its course and this will cause the last reluctant sideline monies to finally join the party. Only when all liquidity is exhausted and all the buyers are in will this move likely end. Our guess is this will occur somewhere in the range of S&P 500 1,200 to 1,300.
So for now weakness appears to be an opportunity to buy stocks, especially in the areas that are working, i.e. technology and small caps.
Source: Kevin Lane, Fusion IQ, March 8, 2010.
Tags: Advertisement, Amp, Bias, Bullish Sentiment, Buy Stocks, Economic Calendar, Economic Recovery, Fusion, Graphs, Guess, Investors, Iq, liquidity, Market Sentiment, Monies, Nasdaq Composite, Pullback, Russell 2000, Shallow, Sideline, Small Caps, Tops
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Hugh Hendry: China Infatuation is Misguided
Friday, February 12th, 2010
Hugh Hendry, CIO, Eclectica Asset Management, writes in the Telegraph UK today, cautioning investors that China’s $1.4 trillion credit expansion and $586-billion domestic spend is a white elephant bet on a global recovery in consumption of its exports that remains to be seen.
“In China, investment spending has tripled since 2001 and the consequences are staggering. A country that represents just 7pc of global GDP is now responsible for 30pc of global aluminum consumption, 47pc of global steel consumption and 40pc of global copper consumption. The overriding problem is that the Chinese model leads to a deflationary spiral that is perpetual in nature. Domestic consumption never grows fast enough to absorb the supply, prompting the planners to commit to ever-higher levels of investment. Over-capacity inevitably plagues many sectors of the economy and Chinese profitability is already low.”
Tags: Aluminum, Bet, China, China Investment, Chinese Model, Consequences, Copper Consumption, Credit Expansion, Deflationary Spiral, Domestic Consumption, Eclectica Asset Management, Elephant, Emerging Markets, GDP, Global Gdp, Global Recovery, Global Steel, Hugh Hendry, Infatuation, Investors, Planners, Profitability, Sectors Of The Economy, Steel Consumption, Telegraph Uk, Trillion, White Elephant
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Technical Talk: Buying Power Argues for Contained Correction
Friday, January 29th, 2010
The comments below were provided by Kevin Lane of Fusion IQ.
As seen in the chart below, individual investor allocations to equities have only recently moved back above its 21-year mean allocation of 60%. The massive under-allocation to equities in late 2008 into the 2009 low was one of the major reasons we became so bullish on stocks since it suggested that selling was washed out of the market and massive liquidity (aka - buying power) was built up ready to buy back into stocks.
That said we have seen assets rotate back to equities over the last 10 months and the market, being a liquidity driven animal, has responded accordingly. Currently investors have only a slight overweight to equities at 4.0% above the 21-year mean or stated another way investors are now 64.0% allocated to equities versus the 21-year mean of 60.0%. This is one reason why we continue to believe that after a bit of a correction stocks can move higher as investor liquidity is not tapped out yet.
While not as ample as near the lows buying power remains adequate to power/move stocks higher and keep corrections fairly well contained.
Source: Kevin Lane, Fusion IQ, January 28, 2009.
Tags: 10 Months, Allocations, Assets, Fusion, Individual Investor, Investors, Iq, Kevin Lane, liquidity, Lows, Market Driven, Move Stocks, Overweight, Power Move
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Howard Marks: Investing for Inflation (January 2010)
Monday, January 25th, 2010
Howard Marks, founder of California based Oaktree Capital, manager of $67-billion in fixed income funds, has just released his latest letter to investors, provides his in-depth case for inflation and how to invest for it. Marks’ letters have a strong following on Wall Street, and he is considered a bond market genius. You can full-page the document in your browser from the slidedeck below, and if you like you may download the letter here.
Read Howard Marks complete newsletter in the slidedeck below:
Tags: Bond Market, Capital Manager, Fixed Income, Genius, Income Funds, inflation, Investing, Investors, Newsletter, Oaktree Capital, Wall Street
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Zweig: Investors Faith in Returns a “Fairy Tale”
Tuesday, January 19th, 2010
Jonathan Zweig, of WSJ’s Intelligent Investor column writes that investors are out of touch with reality as far as their expectations for investment returns are concerned.
The faith in fancifully high returns isn’t just a harmless fairy tale. It leads many people to save too little, in hopes that the markets will bail them out. It leaves others to chase hot performance that cannot last. The end result of fairy-tale expectations, whether you invest for yourself or with the help of a financial adviser, will be a huge shortfall in wealth late in life, and more years working rather than putting your feet up in retirement.
Source: Why Many Investors Keep Fooling Themselves, Jonathan Zweig, January 16, 2009
http://online.wsj.com/article/SB10001424052748704381604575005291706758502.html?mod=WSJ_PersonalFinance_PF2
Tags: Advertisement, Amp, Article Source, Avw, Cb, Ck, End Result, Fairy Tale, Faith, Feet, Financial Adviser, Img Src, Intelligent Investor, Investment Returns, Investor Column, Investors, Jonathan, Leads, Lt, Openx, Personalfinance, Pf2, Random Number, Retirement, Shortfall, Wsj
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A Yen for Canada?
Monday, January 18th, 2010
Back in September I wrote Canada on the Cusp of Something Big outlining my case about the Canadian economy, markets, and loonie. My central argument then, and now, was that Canadians need to get in front of the “invest in Canada,” theme before foreigners do. Sound fiscal policy, strong, well capitalized banks, a productive commodity complex, and our good-old-fashioned brand of conservatism, continue to make Canada the leading destination for investors, both on the domestic front, and internationally, in the G7.
There is more to the Canada story than meets the eye. The fundamentals, are only half the story, and relevant, particularly for the longer term outlook . What matters equally in the near and long term, however, is what is going on behind the scenes in the proprietary institutional and hedge fund trading rooms.
Pierre Daillie (AdvisorAnalyst.com), GlobeAdvisor.com, January 18, 2009
Tags: Advertisement, Banks, Canada, Canada Story, Canadian Economy, Canadians, Central Argument, Commodities, Commodity, Conservatism, Cusp, Foreigners, G7, Globeadvisor, Half The Story, Hedge Fund, Investors, Sound Fiscal Policy, Term Outlook, Yen
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The Key to Normalcy in World Markets?
Wednesday, January 13th, 2010
The yen must replace the dollar in carry trades to restore normalcy to the global economy and markets, including Canada’s.
For nine months we were trapped in the bizarre world of “bad news is good news.” To the puzzlement of investors, stock markets rallied despite deteriorating economic fundamentals, negative GDP growth, 10%-plus unemployment, and the erosion of the dollar’s value globally.
Here’s why…
Pierre Daillie (AdvisorAnalyst.com) GlobeAdvisor.com, January 13, 2009
Tags: Bad News, Bizarre World, Canada, Dollar Value, Economic Fundamentals, Erosion, GDP, GDP Growth, Global Economy, Globeadvisor, Investors, Nine Months, Normalcy, Puzzlement, Stock Markets, Trades, Unemployment, World Markets, World News, Yen Dollar
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WealthTrack: David Winters - searching the world for deep discounts
Saturday, December 26th, 2009
This week Consuelo Mack is joined on WealthTrack by David Winters, a noted value investor who Smart Money magazine identified as one of the “world’s greatest investors”. He searches the world for high quality companies selling at deep discounts to their intrinsic values through the Wintergreen Fund, which brings a hedge fund’s “go anywhere and invest in anything” flexibility to mutual fund customers. In this interview, Winters shares where he is finding value in the market now.
Note: The transcript of this interview is not available yet, but will be posted here as soon as it arrives.
Source: Wealthtrack, December 24, 2009.
Tags: David Winters, Flexibility, Hedge Fund, High Quality, Intrinsic Values, Investors, Mack, Mutual Fund, Quality Companies, Shares, Smart Money Magazine, Value Investor, Wealthtrack, Wintergreen Fund
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Griffiths – almost halfway through dollar rally
Thursday, December 24th, 2009
“We are almost halfway through the dollar rally,” said Robin Griffiths from Cazenove Capital. His target for the US Dollar Index is 81 (currently 77.9). Griffiths also sees stock markets “topping” in March next year and suggests investors look at high yield sectors like oils, pharmas, telecoms and tobacco.
Source: CNBC, December 21, 2009.
Considering the short-term technical picture of the US Dollar Index, Adam Hewison (INO.com) also chipped in a few days ago with a short analysis of the outlook for the greenback, concluding that the rally may have more legs, but the primary trend was still down. Click here to access the presentation.
Tags: Advertisement, Cnbc, Few Days, Greenback, Investors, Legs, oil, Outlook, Rally, Robin Griffiths, Sectors, Stock Markets, Target, Telecoms, Tobacco Source, Us Dollar Index
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Technical Talk: Sentiment Still Not Overly Bullish
Thursday, December 17th, 2009
The comments below were provided by Kevin Lane of Fusion IQ.
As seen in the graphs below, sentiment is still not overly bullish. While sentiment remains more neutral than bullish we expect prices to keep working higher (and corrections to be shallow) as it suggests investors still have more sideline liquidity available to purchase equities.
Source: Kevin Lane, Fusion IQ, December 15, 2009.
Tags: Fusion, Graphs, Investors, Iq, Kevin Lane, liquidity, Sentiment
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Bill Gross: Fed to Keep Rates at Zero Through 2010
Tuesday, December 8th, 2009
The Federal Reserve will keep interest rates near zero in 2010, but longer-term rates will gradually tick higher because of supply and demand, Bill Gross, founder of Pimco, told CNBC Monday.
“We have a lot of supply and perhaps not as much demand to satisfy that supply, and that may actually reinforce the move towards higher rates on the longer end of the yield curve,” he said.
Gross said that stocks will perform “alright” in the long term, but investors should not expect double-digit returns as the Fed pulls excess liquidity out of the markets.
Source: CNBC, December 7, 2009.
Tags: Advertisement, Bill Gross, Cnbc, Excess Liquidity, Federal Reserve, interest rates, Investors, Move Towards, Stocks, Supply And Demand, Yield Curve
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Corporate America’s Massive Cash Hoards
Thursday, December 3rd, 2009
Michael Brush points out that American companies are sitting huge amounts of rainy day money, and they need to start spending again, or start paying some of it back to investors. The latter is the less likely, given that CEOs get nothing for hoarding cash. Knowing which companies will benefit from the spending spree helps.
While many Americans are living on tight budgets because of lost jobs or fear of losing a job, companies face a very different dilemma: They’re sitting on growing piles of cash.
Faced last year with the doomsday scenario of the next Great Depression, companies slashed jobs and cut expenses. The depression never came, and money continued to roll in, albeit often at lower levels.
That’s left companies overflowing with cash — at least a half-trillion dollars more than they had at the end of 2008 and probably much more.
Corporate America’s huge piles of cash, MSN Money, December 1, 2009
Tags: Cash Money, Ceos, Corporate America, Dilemma, Doomsday Scenario, Fear, Great Depression, Hoards, Investors, Jobs, Losing A Job, Massive Cash, Msn Money, Piles, Rainy Day, Spending Spree, Tight Budgets, Trillion
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