Market Timing

Shiller's CAPE – Is There A Better Measure?

Currently, valuation measures are clearly warning the future market returns are going to be substantially lower than they have been over the past eight years. Therefore, if you are expecting the markets to crank out 10% annualized returns over the next 10 years for you to meet your retirement goals, it is likely that you are going to be very disappointed.

"It's Quiet, Too Quiet"

The bulls and the bears have met at the crossroad. However, neither is ready to commit capital towards their inherent convictions. So, for 43-days, and counting, we remain range bound waiting for what is going to happen next... Every bull market in history has ultimately crumbled under the weight of fundamental realities. Despite the many hopes to the contrary, this time will be no different."

Shiller Warns: Stocks Are Partying Like Its 1929!

"I hate to rain on this parade. But the latest lurch upwards in stock prices has just taken market valuations up into the skybox levels, according to the market timing measure with the longest pedigree on Wall Street. It’s just gone from flashing amber to flashing red - meaning, if it’s right, that there is now a significant and rising risk of a crash, and a bigger risk of simply very poor returns."

"We Decided To Close Our Firm" - A Hedge Fund's Lament

"We decided to close our firm," read the email from a friend. Been a brutal year in an unforgiving industry. Industry redemptions this year are $60bln; on track to match the 2009 record. Back then outflows were driven by losses. Now they’re driven by insufficient profits, high fees, and a general aversion by hedge fund managers to take enough risk to earn 8% annual returns.

Stocks Are On The Wrong Side Of A Rate Hike

The problem with being a contrarian is the determination of where in a market cycle the “herd mentality” is operating. The collective wisdom of market participants is generally “right” during the middle of a market advance but “wrong” at market peaks and troughs. There are plenty of warning signals that suggest that investors should be getting more cautious with portfolio allocations. However, the “herd” is still supporting asset prices at current levels based primarily on the “fear” of missing out on further advances.