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Category: Equities

With all due respect to Warren Buffett, the number 1 rule in investing is not anything close to “never lose money.” In fact, the entire notion is absurd. Anyone who has ever invested in the history of the world has lost money at one time or another. Buffett himself lost close to 50% on two […]

False Narratives

A few important things I’ve learned over the years: 1) The prevailing narrative always follows price. 2) Prices can be very wrong at times (the market is NOT always right). 3) When prices are wrong, narratives become nonsense. 4) Chasing nonsense (false narratives) is not an effective investing strategy. Just before midnight on election night last November, […]

We’re closing out the first quarter and Emerging Markets are leading equities higher, with the MSCI Emerging Markets ETF (EEM) up 13.40% versus 4.95% for U.S. large caps (SPY) and 0.18% for U.S. small caps (IWM). After many years of lagging returns in Emerging Markets, this is a notable gap. The possible explanation? I wrote […]

  • Posted in Equities, Fed, Markets
  • Comments Off on An Emerging Divergence in Central Bank Policy

Where is the S&P 500 going to end the year? This is one of the most popular questions in financial media. Why? Because viewers are said to love nothing more than a prediction involving a precise level on a specific date. There are two ways to answer this kind of question… 1) The Prediction (based on […]

  • Posted in Equities, Markets
  • Comments Off on The Difference Between a Prediction and a Probability

We saw something this week in the Nasdaq Composite that we’ve never seen before. In the same trading day, the Nasdaq hit both an all-time high and a 1-month low. Such a pattern is referred to in the technical lexicon as a Bearish Engulfing or Outside Reversal day. The definition only requires the current day […]

  • Posted in Equities, Markets
  • Comments Off on Is the Bearish Engulfing Pattern Actually Bearish?