While oil prices have been dropping fast, in real terms prices are still well above their long-term averages. … [Read more...]
Archives for November 2014
Happy Thanksgiving from New Hampshire!
Happy Thanksgiving!
Wisdom from a Market Veteran
Below are some excerpts from a speech that Bob Rodriguez, the CEO of First Pacific Advisors gave at a recent CFA event. Rodriguez isn’t a household name like Warren Buffet, but he achieved one of the most successful mutual fund records in history. Rodriguez managed the FPA Capital fund from 1984 until 2009. During this period, FPA Capital outperformed various measures of stock market performance by 400 to 600 basis points and was the #1 diversified equity fund for that period. Rodriguez takes a more concentrated approach than is appropriate for many investors, but his insights on investing … [Read more...]
Hedge Funds Go Hunting
Hedge funds are on the hunt for new clients as the WSJ's Wealth Adviser notes here: Hedge funds go mass-market as rich lose interest. For the wealthy and their advisers, “the sex appeal of hedge funds has worn off,” says Pennsylvania-based adviser Douglas Kobak. Because of that, Ben Steverman writes on Bloomberg’s Ventured & Gained blog, the funds have gone “hunting for new, less skeptical customers” by marketing mutual funds marked by “high fees, inconsistent performance and strategies that take a PhD to decipher.” … [Read more...]
The Monday Melee: Turkey Day Edition
On the Road Again Watch out for what promises to be some of the most congested Thanksgiving traffic in years. What We're Reading: How to Decide Whether You Need Rental Car Insurance (lifehacker.com) A Central Bank for the Beltway (The Wall Street Journal) Hiring Good Managers Is Hard? Ha! Try Keeping Them (Research Affiliates) Why there could be life on Venus (Quartz) The Vampire Squid (aka Goldman) strikes again. This time in commodities. (CNN Money) Clueless when it comes to good wine? There's now an app for that. (CNN Money) What the ‘Inequality’ Warriors Really Want (The Wall … [Read more...]
Kill the Squid.
In a 400-page report prepared for a Senate hearing on commodities market rigging, Goldman Sachs (aka the Vampire Squid of Wall Street) was again being accused of questionable business practices. According to the Senate report, Wall Street banks may have manipulated commodities markets raising the costs on consumers. Add this to the long list of Goldman’s other indictments and it becomes clear that it is time for regulators to kill the squid. Goldman should be stripped of its bank holding status and turned back into a pure investment bank. Investors, lenders, and the market can then more … [Read more...]
Year-End Market Update
I was on the phone with a client Wednesday morning when another line lit up indicating someone was being buzzed into my office from the locked foyer area. I was surprised not only to have a visitor but to see that it was my mother. She and my dad just got back from a trip to Europe and I wasn’t expecting to see them until Thanksgiving, which we’ll spend up in the White Mountains of New Hampshire. She was in town for an appointment and stopped by afterwards and we grabbed some coffee at Starbucks. If you’ve ever been inside our Newport office then you’ll know what my mom is talking about when … [Read more...]
These are the Most Popular Stocks on Wall Street
What is popular on Wall Street? The table below lists the most followed stocks in the S&P 500. These aren't necessarily the stocks with the highest analyst ratings, they are the stocks with the most analyst coverage. According to Bloomberg, there are 61 analysts following Apple, 57 following Google, and 55 following Facebook. What possible value does the 35th analyst following Apple add, let alone the 61st, that the 34th analyst has missed? Seems like an awful waste of time and effort. Looks more like a who’s-who of speculation than a list of stocks that a long-term investor would … [Read more...]
A Furious Rally
The S&P 500 has rallied furiously from its October 15th low. Over the last 24 trading days, the index has gained 10.1%--the largest such gain in over three years. Are stocks overbought at these levels? You can be the judge of that. … [Read more...]