Recent Commentary
GameStop Fades – We’ve Seen This Movie Before
Throughout the broad uptrend off the March 2020 lows, we have seen different sectors take on leadership roles at various points in time. The broader the base of advancing stocks, the healthier the market. It is not just FANG+ leading the charge. Value stocks have...
The Folly Of Forecasting
Last year’s zeal for risky investments was epitomized by the run-up in cryptocurrencies. For example, bitcoin quadrupled in value. The surge in bitcoin was driven by individual and institutional investors alike, many wading into the market for the first time. Over...
The New Bull Market At Dow 30,000
THE NEW BULL MARKET AT DOW 30,000 It took less than four years for the Dow Jones Industrial Average to climb from 20,000 to 30,000 (Jan 2017 – Nov 2020). This is remarkable given the volatility over this same time period, including a few plunges to the downside. ...
COVID-19 Resurgence
So far in 2020 we have had a pandemic, a recession, an impeachment trial of a president, social unrest, and a contentious presidential campaign. The coming year could be just as eventful. What do institutional money managers think about such an uncertain environment...
Our Annual Q & A
1. What happened in September? Is this a textbook correction or the start of something worse? The pullback in stocks in September is due to a number of reasons: - Tech stocks (including the FANG+ names) had powerful gains in the summer and had to come...
The Market Is Exuberant, But Is It A Bubble?
S&P 500 performance this year has been dominated by the index’s largest components, and the disparity by cap size is great. So far this year, the 50 largest stocks in the S&P 500 are up an average 11.3% YTD through August 28th. The 50 smallest stocks are down...
What’s In Store For Act IV
The five largest stocks in the S&P 500 (Apple, Amazon, Microsoft, Alphabet, and Facebook) have collectively added $1.66 trillion in market cap this year. The other 495 stocks in the index have lost $1.61 trillion in market cap! The average share price increase...
The Dominance of Growth Stocks Likely to Continue
In our last commentary, we noted the rebound in economic output was giving investors hope and largely accounted for the rally in stocks off the March low. We also wrote of the risk of a resurgence of the virus which is now happening in a handful of states. The...
The Massive Melt-Up Rally
Once again, investor sentiment proved to be a good contrary indicator. At the depths of the market crash (late March), sentiment was overwhelmingly bearish. Since then, the market has had an amazing run (see main section). As people turned more positive on stocks,...
The Federal Reserve Versus Valuations
“Unprecedented” feels like an overused word these days, but it is no overstatement when it comes to the oil market. In the March mid-month commentary, we wrote that the oil supply glut could throw another gut punch to our economy on top of the coronavirus. Our worst...