This morning the leading economic index rose 0.5% for December which would indicate more steady growth to the economy for the first quarter of the year. We will know more when the january leading economic index is reported. However with Europe now engaged in a massive Quantitative Easing Program of billions of Euros into bond buying, and oil still stumbling, you can be sure that stocks will remain volatile but are probably the very best risky asset at this point.
Even the lagging index for December rose 0.3%. I have always enjoyed the LEI index and find it more valuable as it is a weighted gauge of 10 indicators which was designed to signal business-cycle peaks and valleys.
In this kind of environment we are bound now to see more volatility as the economy in the US grows and much of the rest of the world stumbles around, watching the US dollar rise.. The rise in the dollar is obviously in large part a reaction to the rest of the world entering an obvious slowdown. Stocks for now remains the best place to be trading and staying with large cap dividend paying stocks I believe offers the best protection against losses in an environment where trading in risky assets like stocks, is indeed highly risky. That said I believe the economic numbers point to staying in stocks warrants the risk at this time but holding larger amounts of cash on the sidelines is my continuing plan.
Remember my 9 Tips To Stay Profitable In 2015. Stay cautious all year long and focus on protection of capital first and income earned second. That’s my goal for 2015.
Disclaimer: The Numbers Game is a personal commentary by the author. It is a personal opinion only. The author is not a financial planner, analyst or advisor. There are risks involved in all investment strategies and investors can and do lose capital. Trade at your own risk. Stocks, options and investing are risky and can result in considerable losses. None of the strategies, stocks or information discussed and presented are financial or trading advice or recommendations. Everything presented and discussed are the author’s own trade ideas and opinions which the author may or may not enter into. The author assumes no liability for topics, ideas, errors, omissions, content and external links and trades done or not done. The author may or may not enter the trades mentioned. Some positions in mentioned stocks may already be held or are being adjusted.
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