Mean Reversion Still Exists

To say this was a big week for mean reversion would be understatement. US Small Caps (IWM), the most loved asset class in the world, traded lower each and every day this week. On the other side of the coin, Emerging Market Equities (EEM), the most hated asset class in the world, closed higher each […]

Conditions vs. Predictions

The S&P 500 continues to hit new all-time highs. This is bullish, we are told, as new highs are typically followed by more new highs. True indeed, at least until the last new high is reached; that last new high or “the” top is unquestionably bearish. The hard part, of course, is in sorting out […]

At this time last year, the S&P 500 was already up 9% on the year and was closely mirroring two other years which saw unrelenting advances: 1954 and 1995. The equity market would go on to maintain a high correlation with ’54 and ’95 throughout the year, closing out the year at new all-time highs. […]

In Rare Company – 5 Years Later

Today marks the 5-year anniversary of the Bear Market low reached in March 2009. It’s hard to believe that it’s been that long, but even harder to believe what has transpired since. From the depths of despair in March 2009, the S&P 500 is up over 170%, achieving one of the highest 5-year returns in […]

Taking a page from the 2013 playbook, the S&P 500 is once again running straight up from a pullback low (see chart below). This is not atypical behavior following the first dip off of an all-time high, particularly one that was preceded by a long period without a 5% correction. The pattern is largely a […]