Educational Segment | StockChase
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Compiling comments that experts make about stocks while on public TV.

Educational Segment

Date Expert Opinion Subject
2016-02-22 Larry Berman CFA, CMT, CTA

Educational Segment.  Bear Markets.  Once you are armed with the facts, you get a lot of valuable information about the markets.  From 1928, the S&P (a third of the capitalization in the entire world), measuring all the bear markets, the average correction is 13% and this is where people start to panic.  This is not when you should sell, but when you should buy.  The problem is the 22 papa bear markets that are 19% or more and they average a 34% decline.  And the question is "are we in one of those?"  They happen because of extreme valuations (not now), or the financial systemic risk (not now), and the great depression.  In the absence of those three, the average is 20% and no more.  We just had a bit over 15% of a correction recently.  He thinks there is another leg down in this bear so every time the market goes another leg up he takes his equity exposure down.

NORTH AMERICAN - LARGE & ETFs
2016-02-08 Larry Berman CFA, CMT, CTA

Educational Segment.  How to make Smart Monthly Withdrawals.  0.8% is the monthly average return of the S&P over history.   Look at the percentage difference between the current S&P price and the 21-day moving average.  If the current monthly return is twice as much as the average monthly return, it is time to take money out of the market.

NORTH AMERICAN - LARGE & ETFs
2016-02-01 Larry Berman CFA, CMT, CTA

Educational Segment.  Dollar cost averaging.  For the average person, if you are smart, you can make informed decisions beyond dollar cost averaging.  But don’t just invest on the month end.  He looked at the VIX index.  He took a rating of -1.57, and said put that same money in the market when it declines that much.  This is Smart Dollar Cost Averaging.  -1.57 is based on volatility and this is the moment you need to invest.  You don’t know whether to do it at the close or the next morning but he prefers the afternoon of the day of that volatility.

NORTH AMERICAN - LARGE & ETFs
2016-01-25 Larry Berman CFA, CMT, CTA

Educational Segment.  Standard Deviation.  In December, securities regulators put out a paper for comment about more disclosure for mutual funds.  People don’t understand the true cost of investing.  However, the biggest cost to investors is really the emotional costs – the volatility.  People sell when they should be buying.  Standard deviation defines risk.  Looking back over 10 years, higher than 20% on your return means +60 to -40%.  The real cost of investing is being able to stay in the market to get that return.  ETFs are good for keeping in the stocks for the long term.

NORTH AMERICAN - LARGE & ETFs
2016-01-18 Larry Berman CFA, CMT, CTA

Educational Segment.  Are global markets oversold?  Everything he looks at tells him we are ripe for a new trading rally.  We won’t make higher highs, however.  Canada will outperform.  He looks at the percent of stocks above the 200 day moving average.  Only 16.5% (it is very low compared to other periods earlier in the year) of global stocks are above it now.  It was over 50% back in August.  Sell into rallies.  

NORTH AMERICAN - LARGE & ETFs
2016-01-11 Larry Berman CFA, CMT, CTA

Educational Segment.  The Relative Strength Index (RSI).  It looks at the average gain and the average loss over the last 14 days.  The average RSI of SPY-N (S&P 500) going back 22 years is about 54.  The standard deviation (volatility) is 11.  It hit below 2 standard deviations (32) last Friday.  Historically following this point the return has been 3.11% vs. 0.82%.

NORTH AMERICAN - LARGE & ETFs
2015-12-21 Don Vialoux

Educational Segment.  The Electoral Seasonality.  During a presidential election year, the US market slightly underperforms the average.  There is not much change earlier in the year.  But super Tuesday is March 1st when 14 primaries happen.  Around the end of May they have their candidates and from there until the beginning of September, the US market outperforms what it usually does.  The market then goes down until just before the election.  This year they changed the election laws regarding campaign spending (Super Packs).  After the election on November 8th, the markets go higher until the end of the year.

NORTH AMERICAN - LARGE & ETFs
2015-12-14 Larry Berman CFA, CMT, CTA

Educational Segment.  A Recap of his 2015 Predictions and a look at 2016.  China slowed as he predicted.  He expected the anti-EU party to get in in Greece.  He thought they would leave the EU and still thinks it will eventually do so and also that the EU will eventually break up.  In 2016 the biggest risk is credit risk.  The last time credit spreads were this high, the S&P was 20% lower.  He sees a 15-20% correction in 2016.  There are geopolitical risks, ISIS being one of them.  He expects the Fed rate to be 0.75 to 1% by the end of next year.  He predicted crude oil would go down and he thinks it will at best get back to $60 by end of 2016.

NORTH AMERICAN - LARGE & ETFs
2015-12-07 Don Vialoux

Educational Segment. How the markets have reacted to previous rate increases + the El Nino effect on stocks.  The market always goes down prior to the first rate increase.  After the rate increase, the market over the next 3 months goes up over 10%.  The US dollar goes lower.  The same has happened in Canada 6 of 7 times.  Environment Canada has said it will be warmer than average in Canada because of El Nino.  Industrial production increases because more can get done in a warmer winter.  Stock markets do better because of these production increases, although retailers sell less winter coats, energy does less well also.  Don’t be afraid to be in markets over the next three months.

NORTH AMERICAN - LARGE & ETFs
2015-11-30 Larry Berman CFA, CMT, CTA

Educational Segment.  Tax Loss Selling.  This is tax loss selling season.  Energy is the worst sector this year.  FHE-T gives a selection of US energy companies, traded in Canadian dollars, no hedging.  You sell the stocks for tax loss and then buy back this ETF to keep your exposure.  They decided not to hedge to the US $ last year.  Canadian dollar ETFs with US holdings are not subject to US estate taxes on high net worth investors upon death.

NORTH AMERICAN - LARGE & ETFs
2015-11-23 Larry Berman CFA, CMT, CTA

Educational Segment.  Roll-ups in Horizons ETFs.  It is a round of consolidations of ETFs through unit consolidations.  It has to do with moving from one futures contract to another, where you lose some premium.  HNU-T is one of their most popular ETFs.  The loss of some premium of futures contracts is a headwind for this ETF.  The average hold time is a day or two.  Your average hold time has to be less than a week.

NORTH AMERICAN - LARGE & ETFs
2015-11-16 Larry Berman CFA, CMT, CTA

Educational Segment.  Japanese Debt.  There was a $57 billion increase in global debt since Leman.  The biggest accumulation of debt is on the government and corporate sides, not households.  Look at credit default swap spreads.  Emerging markets have higher spreads.  The bond market is starting to get on alert.  The trend has turned and this is where we watch for global systemic risk.

NORTH AMERICAN - LARGE & ETFs
2015-11-09 Larry Berman CFA, CMT, CTA

Educational Segment.  Asset Allocation vs. Stock Selection.  The market could care less where you bought the stock.  Most people don’t know how to get out of a stock.  Over the last 60 years, equities were the best choice, vs. bonds, but the problem is tolerance for volatility.  By combining different asset classes, you can lower volatility.  It is more important than stock selection. 

NORTH AMERICAN - LARGE & ETFs
2015-11-02 Larry Berman CFA, CMT, CTA

Educational Segment.  Retirement and an encore career – you leave the corporation, but keep doing lots of work, possibly part-time.  One of the challenges for this is the uncertainty of returns from investments going forward.  An encore career makes your money last longer in retirement.  People are living longer, perhaps 10 years longer than you expected.  Millennials are looking at living to 110 years old. 

AGRICULTURE, DIVIDEND & FIXED INCOME
2015-10-26 Larry Berman CFA, CMT, CTA

Educational Segment.  Real Estate (like it was a stock).  The guest is cautious on the outlook for real estate.  House maintenance is like an MER is to mutual funds or ETFs.  Real-estate is VERY expensive to maintain.  It is almost becoming a luxury product.  You should not fall in love with the value of your house as they rise and fall.  Don’t sell your own house because it is overvalued.  The current rental house in Toronto has a ‘P/E’ ratio that has risen from 5.1 to 8.5 since 2000.  Vancouver is at 11 times and New York is at 6.  Retirees want to extract maximum value from their house.  Maybe they should think about selling in this kind of market.  Condos are expensive also.

NORTH AMERICAN - LARGE & ETFs
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