Category: Education


Great Expectations

“Ask no questions, and you’ll be told no lies.” – Charles Dickens, Great Expectations What returns are you expecting from equities going forward? “At least 20% a year.” That was a conversation I had last week with an investor. It gives you an idea where we are in terms of sentiment. How did they arrive […]

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Put These Charts on Your Wall … 2020 Edition

Put these charts on your wall for reference the next time you think… Stocks can’t go up during a recession… 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 […]

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COVID-19: Breaking Down the “Second Wave”

Talk of a “second wave” of COVID-19 in the US has begun. Why? Let’s take a closer look through a series of questions and answers… What’s going on with new cases? New daily cases in the US hit their highest level ever yesterday (38,672), surpassing the prior high from April 25 (36,006). But I thought […]

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Are Investors Rational?

Would you pay someone $205 for an asset worth only $21.87? Of course not; what a ridiculous question. And yet, investors in the Ethereum Trust ($ETHE) are doing just that, paying a stunning 837% premium above the net asset value (NAV) of the underlying holdings (Ethereum, a cryptocurrency). Why would anyone do such an irrational […]

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Dazed and Confused

If the dichotomy between markets and the economy has left you dazed and confused, you’re not alone. For on one side of the ledger, you have… 16.5% of the US labor force on unemployment, the highest on record (data back to 1967). US Employment to Population Ratio down to 51.3%, a new low. The prior […]

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5-Chart Friday (4/17/20)

5 charts from the past week that tell an interesting story in markets and investing. 1. Bank Earnings Crushed Bank Earnings…$C: $2.5b profit (-46% YoY), added $7b to loan loss reserves$BAC: $4b profit (-45% YoY), $3.6b loan reserves$GS: $1.2b profit (-46% YoY), $937m loan reserves$WFC: $653m profit (-89% YoY), $3.1b loan reserves$JPM: $2.9b profit (-69% […]

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When All News Is Bad News

The Volatility Index (VIX), also known as the “fear index,” ended today at 82.69. Since its inception in 1990 it has never had a higher close. When was the previous record? November 20, 2008. In the midst of the Global Financial Crisis, after the Lehman Bankruptcy, and 11 months into the worst recession since the […]

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How to Think About Investing Cash on the Sidelines

This is a story many of you will be familiar with. You have money to invest that’s been sitting in cash. This is money you don’t expect to need or access for more than 20 years, if ever. You know that cash is likely to significantly underperform a diversified investment portfolio over the next 20+ […]

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5-Chart Friday (2/14/20)

5 charts from the past week that tell an interesting story in markets and investing… 1) Growth vs. Value The ratio of growth stocks to value stocks is at its highest level in 19 years. The top 10 holdings in the large cap growth ETF (IWF)… The top 10 holdings in the large cap value […]

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The Price of Admission

When investors think about risk, 2008 is usually the first thing that comes to mind. And for good reason. It was the worst year that most investors alive today have ever experienced. With dividends included, the S&P 500 lost 37% in 2008, its largest decline since 1931 (during the Great Depression). Since the end of […]

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