Best Hedges For An Uncertain Market

Best Hedges For An Uncertain Market

The S&P 500 has swung down -10% and swung up 6% in a little bit of a rollercoaster ride over the past couple of weeks and volatility as measured by the CBOE VIX Index peaked above 25 over a week ago as investors scrambled for some kind of direction. The ongoing geopolitical concerns, depressed commodity prices, Ebola scares, and economic slowdowns appear to have finally halted the bull market’s advance. It’s not yet certain if the recent reversal back up will reverse course again and go back down or continue to jump up on positive earnings and bullish Fed sentiments… Read full article at Seeking...
The Secret Junk Bond Bomb That Could Sink The Market

The Secret Junk Bond Bomb That Could Sink The Market

The long bull market has finally begun to crack if October is any indicator. The S&P 500 over the last week has swung between -10% and -3.5% down from its September highs, succumbing to multiple fears including falling oil prices, geopolitical events, downgraded global growth predictions and the Ebola scare… Read full article at Seeking...
Keep It Small: Analyzing Bill Ackman’s Approach

Keep It Small: Analyzing Bill Ackman’s Approach

There’s no such thing as the perfect investor. No one exists who knows with absolute certainty which companies are good, which are bad, and when to buy or sell them. Perfection may not be possible, but we attempt to get as close as possible by never resting on our laurels and studying different investment styles to get a better idea of what works and what doesn’t… Read full article at Seeking...
Higher Market Volatility Could Be A Buying Opportunity

Higher Market Volatility Could Be A Buying Opportunity

Volatility is back. The market is beginning to falter under the barrage of geopolitical turmoil, depressed commodity prices, muted earnings, and now a drop in consumer confidence.The gauge that measures consumer sentiment fell from 93.4 to 86 from last month to September – an 8% drop that brings a sudden end to a 4-month increase in expectations. A look at the CBOE VIX Index, colloquially known as the “fear gauge,” reveals a sharp rise in the past two weeks of trading. Since September 19th, the VIX has climbed nearly 35% from 12.11 to 16.31 as of September 30th.Many investors look at the sudden increase in volatility as a warning sign, but it could be seen as a trading opportunity for those willing to take a little more risk.Volatility In StocksVolatility is one of the fundamental forces of the stock market universe. Much like gravity is responsible for maintaining the orbits of the planets, volatility keeps the market functioning and allows trading to occur.The standard definition of volatility is that it is a measurement of the dispersion of returns in a given security or market. In other words, if the dispersion is more erratic, then the security would be more volatile and therefore garner a higher rate of return to compensate an investor for the perceived risk in owning it.Volatility can be thought of as a roller coaster. You may be more of a thrill-seeker who chooses to ride the tallest, fastest roller coaster around because you enjoy the exhilaration associated with it and you feel comfortable with taking a risk and feeling fear.Other riders tend to be more cautious...
Why Luxury Stocks Have Lagged Over The Past 6 Months And What It Means For Investors

Why Luxury Stocks Have Lagged Over The Past 6 Months And What It Means For Investors

The bull market is continuing to run free well into 2014 and the stock market has hit multiple new highs throughout the year. However, a sector that has beat the S&P 500 over the last 5 years has been surprisingly lagging.Luxury stocks have stalled out over the past several months. Take a look at a comparison between the S&P 500 and the S&P Global Luxury Index (http://us.spindices.com/indices/equity/sp-global-luxury-index). In the last 5 years, the Luxury Index has posted gains of 19% versus the S&P 500’s 15.5%. Now take a look at the index over the past twelve months. The S&P 500 is up 19% while the Luxury Index has actually lost roughly 0.5%.The big question investors are asking is: are the wealthy simply not spending as much, or are they spending it somewhere else? The answer could potentially change the way investors should be looking at the stock market. The predilections of the wealthy often have lasting effects on Wall Street.Breaking It DownWhat’s the difference between the wealthy and those who are considered middle class or poor, other than the obvious monetary answer? Spending habits.One of the most often cited resources for determining economic growth and stability is the consumer spending index. If we take a look back over the past two years, we can see a disturbing trend when it comes to our Nation’s personal habits.According to data taken from the Bureau of Economic Analysis (BEA), personal consumption expenditures have climbed 7.5% from $11.0306 trillion to $11.8678 trillion during that time frame while personal income only increased by 6.7% from $13.7761 trillion to $14.7032 trillion. Personal savings actually decreased...
Alibaba, Facebook, and Twitter: What You Should Own

Alibaba, Facebook, and Twitter: What You Should Own

Tech companies are now the de facto leaders of the stock market. Names like Apple and Google are worth many billions of dollars and dominate headlines daily with new products and earnings reports.  Meanwhile, Wall Street hangs on to every snippet of information in its never ending search for an edge. Other investors are looking for the next up-and-coming tech giant and the flood of internet company IPOs are feeding into those desires.The dorm-room dreams of tech-savvy college students have become legitimate businesses. Since 2011, LinkedIn, Facebook, and Twitter have gone from social networking sites to multi-billion dollar companies that are changing the world.The current big thing investors have their eye on: Alibaba.The Chinese marketplace has been fertile soil for tech company growth. Since the introduction of Baidu (BIDU), a Chinese internet search engine similar to Google (GOOG), investors have kept a close watch on Asian tech companies. Alibaba’s IPO has many investors looking back at Baidu and other internet companies to see what history has taught us and what we can take away from this next offering.A Closer Look At Internet CompaniesBefore we can analyze what Alibaba is and what it might mean for investors, it might help to get a sense of what other internet companies have done to help us get a better picture of what we can expect. Four companies, three of which have begun trading in just the last three years, are close examples to Alibaba that we can find to compare to: Baidu (BIDU), LinkedIn (LNKD), Facebook (FB), and Twitter (TWTR).Baidu (BIDU)This Chinese web services company entered the U.S. market in early August...