Momentum traders – relying on the ‘trend is your friend’ theme – may have a rude awakening soon as momentum stocks trade at a stunning 50% premium to the market (vs an average 20%). As BofAML notes, high growth, high multiple names that have been leading the market over the past year are showing some signs suggest we are close […]
Summary: Overall, fund managers’ asset allocations in August provide conflicting views on sentiment.On the one hand, fund managers’ cash remains at the highest levels since the 2011 and 2012 equity lows and the panic in 2008-09. This is normally contrarian bullish.However, allocations to equities rose over the past two months and are above the mean. Cash levels are high because […]
Getty Images/Mohd RasfanAs regular readers know, for the past ~21 months I have been worrying out loud about US stock prices. Specifically, I have suggested that a decline of 30% to 50% would not be a surprise.I haven’t predicted a crash. But I have said clearly that I think stocks will deliver returns that are way below average for the next […]
The Shanghai Composite and Shenzhen A Share stock markets had bad weeks. Really bad weeks. Both lost more than 10% of their market value, and each fell about 6% in Friday’s trading alone. The catalyst for this week’s volatility? Queaziness from abroad (paywall).Bloomberg had a prescient story about the Chinese equity bubble two days ago (if you ignore that bubble […]
I found some very interesting information when conducting research on small-cap biotech stocks. Most disturbing: Well-respected analysts recommended an abundance of small-cap biotech stocks that have since been annihilated. My job is to give readers ideas where they can start research to not only potentially make money, but to stay away from dangerous names. It’s not going to do any […]
Every month, we review the latest BAML survey of global fund managers. Among the various ways of measuring investor sentiment, this is one of the better ones as the results reflect how managers are allocated in various asset classes. These managers oversee a combined $600b in assets.The data should be viewed mostly from a contrarian perspective; that is, when equities […]
Every month, we review the latest BAML survey of global fund managers. Among the various ways of measuring investor sentiment, this is one of the better ones as the results reflect how managers are allocated in various asset classes. These managers oversee a combined $700b in assets.The data should be viewed mostly from a contrarian perspective; that is, when equities […]
Chinese stocks plunged Monday after the country’s securities regulator rapped three major brokerages for continuing to lend money for stock purchases in violation of rules. As punishment for extending so called “margin trading” contracts, the brokerages are forbidden to offer credit to new customers for three months.How much did shares fall?At one point Monday, the Shanghai Composite Index was down […]
…that growth is slowing, the credit cycle could have already peaked and risk appetites are waning.Over the summer I attended a conference which featured Steen Jakobsen as one of the speakers. The one thing he said that really stuck with me is that long-term bond yields lead the economy by about 9 months. If that is true, economists are going to […]
In an attempt to make the US Open even more dramatic than it already is, IBM has a tool that turns tennis stats into music. NY1’s Adam Balkin filed the following report.Might seem like something a high school math teacher tells his or her students in order to get them more enthusiastic about numbers but really, for the past few […]
