For the last several years simple investment in S&P was a winning strategy. While we advocate smart investing strategies with portfolio rebalancing, there are assets that will usually work for you. Each of these strategies removes you from making active decisions, and places the responsibility on fund managers: 1. Buy BRK.B or IEP or APO …
Leveraged ETFs
We discuss using leveraged ETFs for timing and momentum rebalancing. To this end we choose ETFs over low-volatility indices. In high volatility environment leveraged ETFs can be risky as explained here. Defensive sectors and large indices as well as some commodities are suitable for this approach.
Defensive sectors lowering guidance
Quite counter-intuitively, this quarter the largest “space to improve” in terms of
American market is strong?
Many economists are signalling deflationary pressure [possible growth reduction] in US. Lower guidance is coming from energy sectors. Bullish FED does not help either… This in-depth analysis of situation in US explains why there is no deflation in US and earnings are reasonable. The main arguments are: 1. Drop in commodities prices allow Americans to …
Annually rebalance stocks/bonds
Usually we prefer more active hands-on approach, but sometimes all we can do is balance stocks/bonds. This strategy still is better then choosing only one of them.
Commodities supercycle
This great article shows the current commodities supercycle. Commodities are generally moving in a very wide “channel” supported by inflation with roughly 25 years cycle. The current cycle should be modified by 2008 crisis results for better understanding. It appears that the overall commodities prices are falling right now, as explained by the supercycle theory. …
Dow vs Russel divergence
Usually Dow and Russel are highly correlated, but for the last year this is not so. This article shows some reason for it. We have made the argument here before that, in addition to being fairly valued by pretty much any historical metric, U.S. large-cap stocks face significant headwinds courtesy of the strong dollar. We …
30-Y bond prices
The 30 years T bond prices have been very good in 2014. In fact this article notices triple top structure in bond pattern. This means that TLT and EDV ETFs have become dangerous…
Stop losses
This article recommends to issue put options for the assets (commodities) we invest in, as protection against market changes. In a similar way one may invest in stock market and volatility. Either one or the other will go up… If timed properly (buy low sell high) this method may work. Occasionally (very rare) market and …
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