Put These Charts on Your Wall … 2020 Edition

By Charlie Bilello

07 Jul 2020


Put these charts on your wall for reference the next time you think

  • Stocks can’t go up during a recession…
Created in YCharts
  • It’s “oversold” or “at support” and has to bounce…
  • It’s “overbought” or “at resistance” and can‘t possibly go higher…
  • Investors are rational and would never pay $239.50 for something worth $22.83…
  • It can’t go below $0…
  • Interest rates can’t go any lower…
Created in YCharts
  • You can’t have a market cap of $26 billion with no sales or earnings…
  • You can call a bubble/top without the benefit of hindsight…
  • Volatility can’t possibly go higher…
  • The Fed is “out of bullets” and won’t do more…
  • National Debt can’t go any higher…
  • Value investing is easy…
Created in YCharts

They say a picture is worth a thousand words and in markets that is absolutely true. Having a few extreme charts on your wall can be a helpful reminder that there is no such thing as “can’t,” “won’t,” or “has to” in markets.

The market doesn’t have to do anything, least of all what you think it should do. The market does what it wants, when it wants to do it. It is the real-time personification of collective human psychology, with fear and greed on full display.

That’s what makes it so hard and at the same time so interesting. There are times when skepticism is warranted and other times when you need to suspend disbelief, with no manual to help you decipher which situation applies.

Find some charts that speak to you personally, and put them on your wall as a constant reminder that the range of possible outcomes is much wider than any of us think. We’ve already seen a lifetime supply of material in 2020 and we still have half the year to go.

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About the author

Charlie Bilello

Charlie is the founder and CEO of Compound Capital Advisors.

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