Welcome Back Volatility

2017 was an awesome year to be an investor. Your returns were stable and guaranteed no matter what broad based index you invested in. Not only that but your rate of return was two or three times historical averages. As mentioned, the cherry on top was that volatility was non existent. The markets just kept going up, never taking a break from its climb higher. Then came 2018 and the inevitable questions of sustainability.  The markets can’t possibly keep this up forever could they? Continue reading “Welcome Back Volatility”

Worldwide Rate Hikes

Rate hikes in the US has sped up this year and one more is expected to be announced this week. Another three or four hikes is projected to occur next year. This would leave rates at 2% for the first time in a very long time. This is good news for investors, especially retirees, who need greater return from safer investments. Citigroup and JP Morgan Chase has even more good news for said investors. Continue reading “Worldwide Rate Hikes”

Up, Up and Away

The markets have continued their climb in 2017 to all new heights. They’ve shrugged off any negative news or signs the economy might be slipping a bit to get there. Pretty much any broad based stock index fund around the world would have netted you gains. The increases have been very impressive and below are the returns of a few ETFs to show you the amazing climb the markets have made this year. Continue reading “Up, Up and Away”

Ups and Downs

The markets this year could be described with one word, stability. We’ve seen very little in the way of volatility. Even when bad news has consumed the headlines, markets have shrugged said news off and continued their upward climb. This is very different, if not bizarre, behavior for the markets. Usually when bad news of any kind starts coming out, even if it is an unproven rumor, the markets tend to react creating what we call volatility. A popular measure of volatility is the VIX index and earlier this month it hit its lowest level since 1993. What could possibly rock this boat? Continue reading “Ups and Downs”

Stockless

Yesterday the Dow hit yet another milestone, 20,000, for the first time. It’s always nice to see record stock levels when they are in positive territory. Since the Dow Jones bottomed out during the Great Recession, the market has been up over 300%. This is an incredible jump in less than a decades time but I saw article that shone light on a problem. A record number of Americans aren’t invested in the stock market at all. Continue reading “Stockless”

It’s Finally Over

You know what I’m talking about, the elections. No matter how you feel about your local, state and federal elections, the fact of the matter is, they finally all are over for this year. I’m pretty sure I just heard the entire US cheer but any polls you read would defiantly show the opposite. I know, it was a bad joke but I’m not even going to delve into politics with this post. What I will delve into is something I’ve been talking about since I started this blog and it’s something I will be talking about for a very long time. Continue reading “It’s Finally Over”

Where to Now

If you haven’t heard about it elsewhere, you can read about here on my blog. Stocks are overpriced compared to historical metrics. One big reason for this has been an earnings recession that has continued to drag on. The S&P 500 index has seen year over year earnings decline for five straight quarters. These declines haven’t been massive like the ones during the recession but it is not good that prices were rising while earnings were declining. I do believe there are some glimmers of hope on the horizon but not everything is clear quite yet. Continue reading “Where to Now”

A Bite Out of the Apple

Apple continues to struggle. They’ve been the darling of the stock world for years and yet they are continuing to have trouble. Their Q4 results showed a revenue decline of 9%. Every company experiences this from time to time but what is troubling is the declines were almost across the board. Iphone sales down 5%, Ipad sales down 6% and Mac sales were down 14%. All core products and nothing but declines. Their other product category was also down a massive 21%. The one segment that wasn’t down was their service business. It rose a whopping 23.5%, keeping their performance from being an utter disaster. Their stock obviously took a hit due to this news. So what is the problem? Continue reading “A Bite Out of the Apple”

Price to Earnings Ratio

When I look at a stock, the first thing I look at is the P/E ratio. In essence, this tells me how much I will paying for the companies earnings. A P/E ratio of 12 means you would be paying $12 for each dollar of earnings. Now a days the Forward P/E ratio has taken prominence for the most part over the traditional, backwards looking P/E ratio but I think this is misguided. Focusing on only what you think the company will do ignores what the company has already done. So lets delve into the P/E ratio. Continue reading “Price to Earnings Ratio”

The Ups and Downs

The week following the Brexit vote the markets initially bottomed out. Then only a few days later they rebounded in astounding fashion. Since those initial two weeks, markets have been steady. Every piece of news has been lackluster. Some good, some bad but mostly just average. The markets have responded with very little movement in either direction and trading has been low. This came to a halt yesterday when the US markets dropped anywhere from 2 to 2 ½ percent. But the question is why? Continue reading “The Ups and Downs”