The One with All the Earnings

Earning Season, Birds of a Feather Flock Together Earning Season “officially” begins with the big banks. See the graphic below that shows the number of sectors that report per day. First the banks, then Industrials, Healthcare and Tech, then followed by a free for all. Expect to see these sectors move appropriately. We’ll update this … Continued

Yields, S&P Sector Performance and Earnings

Yields on the Move With all the discussion of yields in the news lately, it is nice to see what’s moving. As seen on the graphic below, most of the movement has been occurring on the shorter duration notes. I.e. The 2-year yield has increased more than the 30-year bond. Sector View Below, we have … Continued

The Wisdom of Crowds

To predict next year’s stock prices, look where investors are putting their money New variants of COVID-19 might drive stock prices lower, or President Joe Biden’s infrastructure plan might push them higher. But what do the markets themselves suggest about the coming year? Let’s estimate 2022 price ranges based on the “wisdom of crowds” by … Continued

Seeking Diversity

Rather than seeking to predict the next big thing, consider buying any of these 20 tickers to diversify a portfolio in the new year When all of the stocks and exchange-traded funds (ETFs) on a portfolio page are colored either green for profit or red for loss, those holdings aren’t diversified. But diversification is worth … Continued

What’s going on with the market?

Take a look at the major indices (SPY, IWM, QQQ) and the equity sectors. Discretionary (XLY) is down the most over the past month, while Health Care (XLV), Real Estate (XLRE), Staples (XLP), and Utilities (XLU) are up. See below for more information.   VIX Futures Curve Curve is up in the back months more … Continued

12 of the Most Boring Stocks

Traders are not a monolithic group. Some have a high risk tolerance, while others are more risk averse. Those with higher risk tolerance would probably prefer to trade TSLA, while those that are more risk averse would lean toward XLU. Here are 12 of the most “boring” stocks and ETFs as measured by a combination … Continued

Yields and Historical Volatilities

Yields Below, check out the 2-, 5-,10-, 20-, and the 30-year Treasury yield to maturity. To see how the yields have changed, look at the different color lines. The 30-year yield hasn’t changed much from one year ago—moving from 1.7% to 1.8%. But on the short end, it has changed quite considerably, moving from 0.20% … Continued

Sizing Futures and Holiday Movement

Futures sizes? We got the hook up for you! Don’t trade without knowing the true size. That said, futures are extremely capital efficient. Black Swan Black Fridays Most traders anticipated last Friday would be a non-event given the holiday weekend and shortened market hours. However, the market surprised everyone and the S&P dropped 2.3%. We … Continued

Smart Inflation Hedges

Looking to take the sting out of an investment’s shrinking value? Ethereum and bitcoin have been anything but stable. Think gold.  Is cryptocurrency the new inflationary hedge? Not for anyone who worries about a 5% drop in purchasing power. Ethereum has had losses that big roughly once every two weeks (or 10% of the time). … Continued

Straddle Up

When you’re expecting a big price move but aren’t certain of the direction  Implied volatility is one of the most useful metrics to consider when looking at a stock’s movement. Symbols with higher implied volatility have higher expected movements, and higher expected movements translate into more expensive options prices. For a real-world example of the … Continued