In this post from late April, I asked several financial experts where they thought the stock market was headed. Here's another round of predictions with a new batch of experts.
Neal Berger, the fund manager who called the market top, founder of fund-of-funds Eagle's View Asset Management, is always seeking undiscovered fund managers who exploit a legitimate "edge" or inefficiency in the market. With decades of experience at prominent firms such as Fuji Bank, Chase Bank, and Millennium Partners, he now manages the investments of wealthy families/individuals.
The question of where the market is headed is a conundrum without an associated time frame and a relevant definition of 'market'. For our purposes, I will assume the question refers to the intermediate/longer-term direction of the equity market. While I always preface my answer to this question with the statement that it is not my game to engage in directional speculation, my view is that we are in the midst of a deflating equity and risk bubble. We are currently experiencing a government induced, liquidity-driven, counter-trend movement in equities and general risk assets. The government appears intent on 'printing' and socializing our way out of poor risk taking behavior that has occurred in markets for more than a decade. I don't believe this is an effective strategy in the long-term. While we may see further rally in the equity market, the depreciating dollar will certainly reduce our global purchasing power in real terms. While the equity markets are sure to see periods of ups and downs, my view is for a generational move lower and a complete re-pricing of risk assets akin to the Japanese experience of the last 20 years+.
Michael Covel is the author of two best selling books, Trend Following and The Complete Turtle Trader. While educating his followers on his blog, Michael just finished his first film, Broke: The New American Dream. This documentary not only details the causes of our economic problems, but also features eye-opening revelations from today's top financiers and traders.
I have no idea what stock, bond, currency, and commodity markets will do over the next six months. How many of the great fundamental analysts had calls that made their clients money over 2008? Not many as trillions of dollars were lost through buy and hold prediction nonsense. Sure, some very smart analysts will get the next six month's of predictions right, but then again when you flip a coin you have a 50% chance of being right too. Does that mean there is no hope for profit? No. If you can put aside the need to try and predict the future and if you can instead trade as a technical trader, like trend followers who made fortunes in 2008, you will have a chance to make money going forward. Bottom line, if we can't know the future and if we can't know what direction any market will trend it is far better to have a plan to systematically profit by reacting to market moves versus a reliance on the false hope of predictions. Trading for profits speech aside, how do I feel personally about the economy? Broke is definitely the new American dream.
Jonathan Hoenig is a portfolio manager at CapitalistPig Asset Management, LLC, an analyst for Fox News, and the author of Greed Is Good: The Capitalist Pig Guide to Investing. He is also regular contributor to the The Wall Street Journal, SmartMoney, and Capitalist Magazine.
The market has all the time in the world. It could rally another 20% before falling back down to the lows or simply tread water at current levels for another year. Trying to forecast out more than a few weeks is a fool's game.
I don't harbor any blind devotion to one asset class, especially equities. As the past decade has aptly demonstrated, just because stocks have performed well over the long term doesn't tell us how they might perform over our actual holding period, which is likely much shorter than the 70-plus years often quoted in those studies. When allocating my hedge fund, I cast a wide net.
Yet knowing the long-term starts in the here-and-now, I'm emboldened by the recent bullish price action which has provided the most encouraging sign for equities I've seen in well over eighteen months. To that end, stocks should be part of most portfolios, but not the only part.
In my fund, we're primarily allocated to foreign currencies, including the Japanese Yen, Mexican Peso and South African Rand. Our top equity allocation right now is in Japan, including positions in Panasonic (NYSE: PC), Advantest Corp. (NYSE: ATE) Mitsui & Co. Ltd. (NASDAQ: MITSY), Sony Corp. (NYSE: SNE) and FUJIFILM Corp. (NASDAQ: FUJI). We're also looking at palladium.
The biggest impact on one's portfolio comes from their investment technique...not what you buy, but how you buy it That's even more true now that intervention from Washington has become the primarily influence on Wall Street. Investors should look for opportunity but keep their guard up. Uncle Sam is running the show now.
Andrew Horowitz is author of the book The Disciplined Investor, where he details his experience as a portfolio analyst and fund manager. Andrew's blog and podcasts are designed to assist all types of investors make crucial money management decisions. Andrew is a regular contributor on CNBC, Bloomberg, and FOXNews.
There is an invisible hand at work and the markets are not happy about it. Volume is drying up and the earnings are as lousy as they can get. The fear of not getting in on what could be amazing gains has turned investors from riskless to reckless. Buying on the dip and too big to fail are all ways to get in and get hurt. What we see is a commercial real estate breakdown, bank failures, deflation and trillions of taxpayer dollars going to the rescue of banks and companies that should be taken out. Short term trading with discipline is the key and downside risk mitigation. While a tricky task, is the way to get and keep profits.
Brian Shannon is an expert trader and the author of Technical Analysis Using Multiple Time Frames. While detailing his market moves on alphatrends.net, a subscription newsletter under the StockTwits umbrella, you can also follow him on Twitter @alphatrends for real-time market commentary.
From the March 6 low to the intraday high obtained on Tuesday of this week, the S&P 500 rallied 38.4% in just three months. The speed and magnitude of the rally has caused a lot of head scratching from bears who can recite depressing facts about why the rally does not make sense, it is appears to be a classic example of the market climbing a wall of worry. The sentiment amongst retail investors seems to be shifting towards a much more positive outlook as their confidence is high with all the recent long side gains and the media seems focused on the fact that the S&P 500 has closed above the 200 day moving average for the first time since December 2007. What makes me much more cautious right now is that the slope of the 200 day moving average remains negative. We have seen a large correction in the markets price wise, now it appears that we will enter a period of correction through time which is necessary to repair the damage still evident in most areas.
Michael Covel is the author of two best selling books, Trend Following and The Complete Turtle Trader. While educating his followers on his blog, Michael just finished his first film, Broke: The New American Dream. This documentary not only details the causes of our economic problems, but also features eye-opening revelations from today's top financiers and traders.
I have no idea what stock, bond, currency, and commodity markets will do over the next six months. How many of the great fundamental analysts had calls that made their clients money over 2008? Not many as trillions of dollars were lost through buy and hold prediction nonsense. Sure, some very smart analysts will get the next six month's of predictions right, but then again when you flip a coin you have a 50% chance of being right too. Does that mean there is no hope for profit? No. If you can put aside the need to try and predict the future and if you can instead trade as a technical trader, like trend followers who made fortunes in 2008, you will have a chance to make money going forward. Bottom line, if we can't know the future and if we can't know what direction any market will trend it is far better to have a plan to systematically profit by reacting to market moves versus a reliance on the false hope of predictions. Trading for profits speech aside, how do I feel personally about the economy? Broke is definitely the new American dream.
Jonathan Hoenig is a portfolio manager at CapitalistPig Asset Management, LLC, an analyst for Fox News, and the author of Greed Is Good: The Capitalist Pig Guide to Investing. He is also regular contributor to the The Wall Street Journal, SmartMoney, and Capitalist Magazine.
The market has all the time in the world. It could rally another 20% before falling back down to the lows or simply tread water at current levels for another year. Trying to forecast out more than a few weeks is a fool's game.
I don't harbor any blind devotion to one asset class, especially equities. As the past decade has aptly demonstrated, just because stocks have performed well over the long term doesn't tell us how they might perform over our actual holding period, which is likely much shorter than the 70-plus years often quoted in those studies. When allocating my hedge fund, I cast a wide net.
Yet knowing the long-term starts in the here-and-now, I'm emboldened by the recent bullish price action which has provided the most encouraging sign for equities I've seen in well over eighteen months. To that end, stocks should be part of most portfolios, but not the only part.
In my fund, we're primarily allocated to foreign currencies, including the Japanese Yen, Mexican Peso and South African Rand. Our top equity allocation right now is in Japan, including positions in Panasonic (NYSE: PC), Advantest Corp. (NYSE: ATE) Mitsui & Co. Ltd. (NASDAQ: MITSY), Sony Corp. (NYSE: SNE) and FUJIFILM Corp. (NASDAQ: FUJI). We're also looking at palladium.
The biggest impact on one's portfolio comes from their investment technique...not what you buy, but how you buy it That's even more true now that intervention from Washington has become the primarily influence on Wall Street. Investors should look for opportunity but keep their guard up. Uncle Sam is running the show now.
Andrew Horowitz is author of the book The Disciplined Investor, where he details his experience as a portfolio analyst and fund manager. Andrew's blog and podcasts are designed to assist all types of investors make crucial money management decisions. Andrew is a regular contributor on CNBC, Bloomberg, and FOXNews.
There is an invisible hand at work and the markets are not happy about it. Volume is drying up and the earnings are as lousy as they can get. The fear of not getting in on what could be amazing gains has turned investors from riskless to reckless. Buying on the dip and too big to fail are all ways to get in and get hurt. What we see is a commercial real estate breakdown, bank failures, deflation and trillions of taxpayer dollars going to the rescue of banks and companies that should be taken out. Short term trading with discipline is the key and downside risk mitigation. While a tricky task, is the way to get and keep profits.
Brian Shannon is an expert trader and the author of Technical Analysis Using Multiple Time Frames. While detailing his market moves on alphatrends.net, a subscription newsletter under the StockTwits umbrella, you can also follow him on Twitter @alphatrends for real-time market commentary.
From the March 6 low to the intraday high obtained on Tuesday of this week, the S&P 500 rallied 38.4% in just three months. The speed and magnitude of the rally has caused a lot of head scratching from bears who can recite depressing facts about why the rally does not make sense, it is appears to be a classic example of the market climbing a wall of worry. The sentiment amongst retail investors seems to be shifting towards a much more positive outlook as their confidence is high with all the recent long side gains and the media seems focused on the fact that the S&P 500 has closed above the 200 day moving average for the first time since December 2007. What makes me much more cautious right now is that the slope of the 200 day moving average remains negative. We have seen a large correction in the markets price wise, now it appears that we will enter a period of correction through time which is necessary to repair the damage still evident in most areas.
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