Stocks Continue Rise in the Second Quarter
In Market Analysis onRead moreToews began the quarter with a partial (1/3) allocation to US Stocks, with all other asset classes fully invested. We completed our exit out of US stocks in Mid-April. During the quarter, small cap stocks initially suffered losses while the S&P remained relatively steady. Stocks began to rebound and our system re-entered in late May. We finished the quarter fully
Stocks Hold Significant Risks even at Fair Value
In Market Analysis onRead moreInvesting platitudes (allocate, rebalance, repeat) about stocks betray the high risks and limited time horizons for the bulk of investors. The reason has everything to do with the way we price stocks. Small businesses, not listed on exchanges, sell for low multiples (example: 4 times earnings). But when companies grow and eventually go public, valuations average 15 times earnings. Instead
Toews Delivers Up Capture as Tactical Suffers
In Market Analysis onRead moreInvestors remained anxious entering 2013, and there was no shortage of stress-evoking events. Despite that, the S&P 500 realized the best gain since 1997, rising 32.4%. Toews investors spent the majority of the year fully invested in stocks across their allocations. In fact, with the exception of 6 market days when we were 2/3 invested, our US stock algorithm remained
The Most Important Characteristic of Loss Avoidance Strategies – Up-Capture
In Market Analysis onRead moreOriginally posted on October 30th, 2013It’s not a small matter. Strong return years make outsized contributions to the overall above-inflation returns realized by equities. It is also hugely important behaviorally for investors.
Investors Vulnerable to Fixed Income Behavioral Biases
In Market Analysis onRead moreInvestors continue to view fixed income as the default “risk-off” slice of investors’ portfolios, even as they are faced with two distinct challenges: Yields are dismal and risks are high. Part of the problem is that solutions to the fixed income problem are foggy. In this commentary we discuss the risks, both asset based and behavioral, as well as viable