Finance

September 2021 – Both Kinds of Volatility

[vc_row css=”.vc_custom_1655389395144{padding-top: 15px !important;padding-right: 60px !important;padding-left: 60px !important;}”][vc_column][vc_column_text] When investors talk about volatility, they are usually referring to losses in markets. Volatility, however, can also be defined as disorderly moves upwards in stocks as well. Below is our new video on passive investing, where we explain why passive is increasing volatility and we may be …

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July 2021 – The Mother of All Energy Stock Setups

[vc_row css=”.vc_custom_1655390412100{padding-top: 20px !important;padding-right: 60px !important;padding-left: 60px !important;}”][vc_column][vc_column_text]On August 2nd, 1990, the Iraqi army invaded and occupied Kuwait. Global energy markets reeled as some of the largest supplies of crude oil were suddenly in doubt. Speculators piled into crude oil, doubling the price to about $80 per barrel. The consensus expected more fighting from a …

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May 2021 – Horror Movie Stock

[vc_row css=”.vc_custom_1655390438084{padding-top: 20px !important;padding-right: 60px !important;padding-left: 60px !important;}”][vc_column][vc_column_text] Fans of classic horror movies love and expect the typical cliches like victims attempting to escape in a car that won’t start or a group of clueless teenagers taking refuge in an ominous looking haunted house. As viewers, we can’t help but groaning aloud “No! Don’t go …

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April 2021 – Liquidity Drought

[vc_row css=”.vc_custom_1655389756150{padding-top: 15px !important;padding-right: 60px !important;padding-left: 60px !important;}”][vc_column][vc_column_text]As investors watch the Federal Reserve continue its stunning balance sheet expansion, the financial media often touts how the US central bank is “flooding the markets with liquidity.” Is this really the case? Are stocks making new highs in every month so far in 2021 on heavy buy …

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March 2021 – Value Pays Cash

[vc_row css=”.vc_custom_1655390138099{padding-top: 20px !important;padding-right: 60px !important;padding-left: 60px !important;}”][vc_column][vc_column_text]For several years now, growth stocks, led by the largest technology companies like Amazon, Facebook, Microsoft, and Google, have outperformed their slower-growing value counterparts. Fundamentally, the rapid growth in revenue and cash flows at the tech giants justified their outsized moves. Value companies struggled to grow, and their …

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February 2021 – The Interest Rate Arsonist

[vc_row css=”.vc_custom_1655390206138{padding-top: 20px !important;padding-right: 60px !important;padding-left: 60px !important;}”][vc_column][vc_column_text]In 2020, 30-year mortgage rates declined from 3.45% to 2.67%. This means for a $500,000 house, 20% down-payment, and 30-year fixed mortgage, the monthly payment declined from $2068 to $1899. To think about this another way, someone borrowing at 2.67% could spend $550,000 and end up with the …

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January 2021 – Bitcoin: When Fundamentals Overwhelm Technicals

[vc_row css=”.vc_custom_1655390492724{padding-top: 20px !important;padding-right: 60px !important;padding-left: 60px !important;}”][vc_column][vc_column_text]Cryptocurrency Bitcoin enjoyed a tremendous rally in 2020, appreciating from about $7,000 to nearly $29,000, or roughly 315%. The Internet is littered with well-documented debates on the viability of Bitcoin and the sustainability of the rally itself. What do we believe is the most overlooked factor? The fundamentals …

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December 2020 – Passive Market Share Update

[vc_row css=”.vc_custom_1655390293895{padding-top: 20px !important;padding-right: 60px !important;padding-left: 60px !important;}”][vc_column][vc_column_text] We have updated our paper on passive investing and its effects on US stocks. The paper is available for free download here.   Passive Ownership of Major Companies The largest three passive firms continued gobbling up shares of US equities in Q3 20. Below are the percentages of …

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November 2020 – Finally Time for Value?

[vc_row css=”.vc_custom_1655390340944{padding-top: 20px !important;padding-right: 60px !important;padding-left: 60px !important;}”][vc_column][vc_column_text]As good vaccine news comes out, there have been some significant changes in stock market trends. Stay-at-home stocks, the momentum darlings of 2020 have lost their wings, while the extremely beaten-down value stocks have appreciated sharply. Is now finally the time, after years of momentum stocks leading the …

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October 2020 Update

[vc_row css=”.vc_custom_1655390385481{padding-top: 20px !important;padding-right: 60px !important;padding-left: 60px !important;}”][vc_column][vc_column_text] How will central banks and politicians, hooked on intervention react to slowing stock markets and economies? With more money-printing, of course! What does this mean for your money? Inflation may seem imminent, but we believe deflation comes first. There is a wider, more volatile set of outcomes …

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