Weekly Update

September 9, 2016 Update


Bond rates get an adjustment

One of the major themes of investing in 2016 has been the persistence of ultra-low interest rates. Much has been made of the fact that fully 1/3 of the sovereign (government) bond yields are now below zero. In an era where central banks buy bonds hand over fist insuring an almost unlimited demand, market participants have become complacent and expecting of rates to remain low and going lower. Thursday and Friday, central banks started to perhaps begin taking baby steps in the other direction. (more…)

Weekly Update

September 2, 2016 Update



A battle for the future is ON!

If you are interested at all in business and/or technology you must pay close attention to the rapidly changing world of automobile transportation.

  • Self-driving cars!
  • Transportation as a service via software app (e.g. Uber and Lyft) with automated ride-sharing.
  • Electric cars.

All three of these big leaps in service, technology, and transportation are happening simultaneously and at a speed of development that is breathtaking. (more…)

Weekly Update

Model-driven investing

Published August 26, 2016


Anyone who has experienced the loss from an investment can tell you that the emotional pain from that loss not only stings, it lingers. Studies show that our emotional response to loss far exceeds the joy experienced when our investments provide a positive return. (more…)

Weekly Update

August 19, 2016 Update


Option basics

Options are contracts to buy or sell a stock at a certain price. We can buy them as a proxy for buying or selling securities. We can sell them to generate income. Or we can buy them to protect other positions we own. (more…)

Weekly Update

August 12, 2016 Update


The doomsayers

We ran across the graphic below this week and found it amusing. We’ve often taken to task the doomsday prophets in the investment community. They make their living trying to convince the world’s investors that another financial catastrophe is just around the corner. Given that there is always a reasonable chunk of the population who shares the view of the doomsayers, it’s a pretty lucrative gig. Of course their track record of predicting doom is extremely poor. (more…)

Weekly Update

August 5, 2016 Update


FPResearch unveils the holy grail of investing strategies

The stock market historically delivers a 10-12% annual return. That level of return will double your money every seven years. But many investors never see that doubling because that return comes with the extraordinary risk of seeing your investment account drop by a third or more once a decade on average, and by 15-20% on an almost annual basis. This level of volatility leads investors to find investing in the stock market to be extremely hard on their emotions with many choosing to simply take their money out of the market regardless of the attractiveness of the long-term returns. (more…)

Weekly Update

July 29, 2016 Update


Putting Apple’s move in context

This week, for the first time in quite a while, former market darling Apple popped higher following a surprisingly strong earnings report. The stock gapped higher delivering another upward push to a powerful Nasdaq Composite rally in progress for five weeks now. Despite the one-day enthusiasm for the stock, more work is needed to reverse Apple’s year-plus decline as shown here: (more…)

Weekly Update

July 22, 2016 Update


Risk-on or risk-off?

Graphical ratio or “pairs” analysis is a quick way to see what preferences the market is displaying. Generally speaking, we are looking for whether the market is embracing a “risk-on” posture – e.g. choosing riskier assets to invest in – or a “risk-off” posture – showing a preference for lower-risk, defensive assets. (more…)

Weekly Update

July 15, 2016 Update


Initiation is a good thing

Sometimes stock investors just get things a-moving. We see big jumps in stock prices that clearly reflect a change of attitude. These big jumps can come late in a rally when investors fear of missing out (FOMO) kicks into high gear. We saw this FOMO on full display in September-October of 2007. Emerging market stocks had delivered a long and powerful run more than tripling in price over a four-and-a-half year period. (more…)

Weekly Update

July 8, 2016 Update


Robo-advisors – Passive gets a new package

The investment industry thrives on new products, new ways to invest that are usually just a different marketing spin on the same stuff. The basic investment strategies are well-known. You can endeavor to be a “value” investor buying low and intending to sell high. You can choose to be a momentum or growth investor buying “high” in hopes of selling at even higher prices those companies, industries, sectors, markets that are already moving up. (more…)