The concept of rising interest rates is one that investors have been worried about for many years. While we have yet to experience an extended period of rising Treasury bond yields in the last several decades, that hasn’t tampered fears of how such an event would unfold and to what magnitude.
Interest rates, like stocks or commodities, go through cycles of rising and falling trends that can have a pronounced impact on your portfolio returns. Fixed-income assets experience the highest level of inverse correlation with interest rates. However, there is also an undeniable impact on certain stock market sectors as well.
I’ve been fascinated watching the sentiment and price trends in publicly traded retail stocks over the last six months. Unless you have been living under a rock, you are probably aware that Amazon.com (AMZN) has been minted as the frontrunner to take over just about every conceivable retail segment in the next decade. Their share price shows it too after crossing the $1,000 barrier and showing no signs of immediate distress. Read more
In this month’s video, I look at the technical trends developing in growth versus value stocks. Chart review includes analysis of large-cap, small cap, international, Treasury bonds, and high yield bond ETF prices. Observations of risk and reward are noted throughout, with an emphasis on trend following and sensible portfolio management. Recorded on May 31, 2017.
Sometimes you stumble across a sector of the market that is just in the right place at the right time. That may very well be the sentiment driving the remarkable price action in aerospace and defense stocks in the current geopolitical environment. These companies are the driving forces behind military and commercial aircraft, defense equipment, and other services designed to support the armed forces. Read more
There is an allure to stock picking that many investors find irresistible. They want to believe that uncovering the next Apple, Facebook, or Amazon is just a click away. That they will have the fortitude to hold through the desperate times, in order to reap the rewards of exponentially increasing their wealth.
Individual stocks also carry unique and personable stories that make them easier to latch onto. Products that consumers love. Executives with a firm grasp on their business model. Fundamentals that belie the true value of the company’s hidden potential. Some, or all, of these factors add to the attractiveness of publicly-traded stocks as they align with your philosophical beliefs about the markets and economy.