The plunge of gold today, down $63.50 or 4% was followed by further declines after hours as the fall of gold to 1500 brought in a lot of selling after hours. Gold closed the day down a whopping $86.70 or 5.54% to 1477.60. Many investors are stunned. While after hours I watched and read a number of media articles about how this decline had been predicted by the “smart money” I don’t see it that way. I read very few reports on how the smart money was dumping gold until just the last / Read More
Market Direction is the most important aspect of investing. Even those who preach Buy and Hold as the only method for “true investors” are affected by market direction since almost all stocks are affected by overall market direction. Today I read with interest an article on seeking alpha where the author went to great lengths to prove historically the bull side for the market direction to continue higher and why the bear side of the argument has no merit at present. As some readers may recall I am not a bull or bear / Read More
A question from a reader made me think that perhaps I needed to expand a bit on the importance of setting realistic goals. For example, my goal is to earn 12% a year with my entire portfolio and I break that down to an objective of 1% a month. A reader wrote in wondering if that goal changes with inflation. Here is the question from the investor. Reader’s Questions On the 1% A Month Objective After I read your article (my Strategy Explained) about the aim is to make 1% (as a minimum) / Read More
The market direction climb to reach 1500 has seemed almost relentless throughout January. On Friday the S&P 500 closed above 1500 marking an amazing recovery from the depths of the bear market of 2008 to 2009 and more than doubling the value of the S&P 500 from 700 to 1500. With the market pushed to 1500, are stocks overvalued? Is this a time to commit more capital or less capital? Should investors be buying now or should they wait for a correction and what happens if that correction is so small that stock / Read More
Every once in a while on my yahoo forum (shameless plug for the forum) there are questions posed about where an investor can get great charting tools and decent commission rates for trading. Every day I get an email asking “who is the best discount broker“. Today there are a lot of discount brokers, especially in the United States and often it is not hard to find the best discount broker. (I am so jealous). In Canada it’s a very different story where the big banks have monopolized the discount brokerage industry and / Read More
Put Selling against stocks is my principal investment method. I enjoy Put Selling both from a profit perspective and from a fun perspective. I realize that may seem odd to a lot of investors, but I look at my investing like a business and if you don’t enjoy running a business then you should look for a job elsewhere. In my business of investing it is fun everyday to study my stocks looking for Put Selling opportunities to make a profit in my business. But one of the areas that I am very / Read More
Happy New Year! 2012 was one of the best years for returns. The three corrections and subsequent rallies boosted my portfolio to one of the best gains since 2009. Whether 2013 can provide the same returns is tough to call at this point. Market direction presently remains up. The passing of the budget deal to remove the threat of increased taxes by the Senate and Congress this evening is a major step in keeping the market direction up. I would expect some further rallying before the market stops to catch its breath. Market / Read More
Looking back at 2012 one word certainly comes to mind, CONSISTENCY. 2012 provided terrific opportunities with three major rallies and three corrections. The chart below shows the three rallies during 2012. In-between each rally, the media both online and offline was filled with doom and gloom. Those who follow the adage of “sell in May and go away”, should have followed “return in June for a summer bloom”. Doom Sayers Wrong Again In 2012 the doom sayers were wrong yet again. Some of the supposedly smartest investors claimed stocks would crash this year / Read More
In a somewhat unusual twist the best known bear in Canada, David Rosenberg is advising investors to get their cash back working and dividend paying stocks are not a bad choice as long as they diversify. Rosenberg has been a bear for, well almost forever. His outlook though for 2013 seems at odds with his stance earlier when from 2009 to 2012 investors could have more than doubled their returns as stock markets recovered. I am not sure what to make of his present stance. In a note to clients he advised that / Read More
You just have to tip your hat to Mr. Bernanke. On one hand we have the fiscal cliff issue which if not resolved could see some damaging results to the economy of the US. Those results would be far-reaching and definitely impact more than the US. This is what the Republicans find so difficult. They are between a rock and a hard place. No matter how they try to sell it, if the fiscal cliff issue fails to be resolved they will be held accountable by most Americans. Yet a lot of what / Read More
Market direction is the single most important aspect of the decision-making process behind investing in equities. You can buy the “greatest” stocks but when the overall market direction trend is lower, negative investor sentiment will outweigh even the “greatest” stocks. Today I was reading an article on why the next 10 years are going to miserable for equities based on Macroeconomic charting. The article “The Next 10 Years: Much More Misery” is on seeking alpha and can be read through this market direction link. I know from experience that market direction investing based / Read More
25 years ago today stock markets around the world crashed. Investors were shocked and billions of dollars wiped out.The crash actually started in Hong Kong and spread to Europe and then the United States and Canada. The Dow Jones dropped 508 points to 1738.74 losing 22.6%. It was called Black Monday and many investors, analysts and economists feared it was a repeat fo the crash of 1929. Indeed 33 eminent economists from around the world met in Washington DC in December 1987 and they predicted that the years to follow Black monday would / Read More
Yesterday at the age of 82 Neil Armstrong passed away. I remember watching in amazement as the small Apollo 11 spacecraft touch down on the moon. I watched in awe as he stepped foot on the moon and our family black and white TV lit the room that evening. I was at my parent’s home that evening along with family and many friends. The drive over was the quietest I had experienced in years as so many people were in front of their televisions waiting for the pictures to be televised. It was / Read More
This morning’s Empire State index fell the 2.3 from May’s 17.1 showing the weakness in the US economy’s manufacturing. The Michigan Consumer Sentiment Index is back to December levels. Unemployment is up, housing prices remain weak and Europe looks like it is about to implode. Other recent readings on the overall growth of the US economy are pointing to a slowdown ahead and investors rather than fretting are liking the numbers they see and pushing the market direction higher. It’s because they believe the Federal Reserve will be forced to act and pump / Read More
Jackass Investing by Michael Dever is a myth busting investment book which I wrote a review about on June 2. After writing my review, I received an email from the publisher who wondered if I had missed some of the book, in particular the Action Section when I read the book. I actually didn’t miss the action section which would be hard to miss because it is everywhere and it simply directs readers to the website for Jackass Investing. I saw no back-tested strategies on specific stocks or ETFs with charts and diagrams, / Read More
