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

Educational Segment

Date Expert Opinion Subject
2016-04-18 Larry Berman CFA, CMT, CTA

Educational Segment.  An agreement among stop producers did not happen.  They were talking of freezing production.  But if he was running Iran and had been under sanctions for 5 years, he would pump as much as he could to get his share of the revenue.  Probably the highs we have seen recently are all we are going to see for now.  5 years ago OECD did not have a clue what fracking would do.  Right now they are expecting no material increase in production in North America for over a decade.  The XEG-T trend line is up, but we have to watch for it to break down.  We have 10-15% correction risk.  ZJO-T is energy and juniors would have 15-20% correction risk.

NORTH AMERICAN - LARGE & ETFs
2016-04-11 Larry Berman CFA, CMT, CTA

Educational Segment.  A Safe Withdrawal Rate from Retirement Savings (e.g. RRSP/RRIF).  With a 5% interest rate return, it would have taken $178k for an income of $48k through retirement.  Now you have to put $563k to get the same payout.  This environment crushes the savers.  Less than 10% of Canadians have a financial plan.  You HAVE to have one.  There is a pending crisis regarding retirement because of low interest rates.  If you withdraw at too high a rate, you run out of money.

NORTH AMERICAN - LARGE & ETFs
2016-04-04 Larry Berman CFA, CMT, CTA

Educational Segment.  April Showers and No May flowers.  He sees a lot of risk. Looking bottom up, analysts started out looking up, but as earnings are coming out, they have taken estimates down just before that. The risk this year is that earnings don’t deliver.  Looking top down, the analysts are worse.  In 2015 they had big expectations, but then they were wrong.  As markets sell off, they start lowering their forecasts.  There is downside risk as we get into earnings season again.  You should take some money off the table right now and buy back later.

NORTH AMERICAN - LARGE & ETFs
2016-03-28 Larry Berman CFA, CMT, CTA

Educational Segment. Fixed income.  Spreads in credit are far more a leading indicator than the stock market.  The bond guys understand a lot better what is happening in the economy than the stock guys.  Corporate bond spreads vs. treasury ETFs:  They have been widening.  They have come back to the same levels as in ’08/’09.  They are telling us the economy is not healthy.  European banks: EUFN-N and the FTSE Europe ETF. The banks have dragged everything down.  There are big risks in credit spreads.  Portuguese bond spreads have widened dramatically and a lot of refinancing has to happen over the next 5 years so that is the next big risk to the European economy.  You don’t go all to cash.  You have to understand asset allocation.

NORTH AMERICAN - LARGE & ETFs
2016-03-28 Larry Berman CFA, CMT, CTA

He cares most about business risk to the banking sector overall.  See his educational segment today.  The banks had a great run from January, but he does not like owning banks generally.  He does not like TD-T here and is underweight financials as a source of dividends in his dividend fund.  He did hold it earlier in the year for a while.

NORTH AMERICAN - LARGE & ETFs
2016-03-21 Larry Berman CFA, CMT, CTA

Educational Segment.  Why Raising Retirement Age is a Good Idea.  A Lawyer and an Actuary penned an article about why it was a bad idea to roll back OAS from 67 to 65.  We are all living longer.  OAS started in the 1950s and life expectancy was 80.  Now if you live to 65 you are likely to live to 85.  We will be at 16% young people going forward, but the number of old people will be going up dramatically (16-24%).  Governments are inept at dealing with people living longer.  The kids are going to pay.  Each one owes $38k right now.  The US will be out of OAS by 2039 if they don’t change policy. 

NORTH AMERICAN - LARGE & ETFs
2016-03-14 Larry Berman CFA, CMT, CTA

Educational Segment.  After the recent market rally what comes next?  The markets popped in the last week and now we are into a period of resistance.  We are in a global bear market and have we bottomed?  Market breadth: The US market has had good breadth, but not around the world – mixed reading, slightly negative.  Valuations higher than ever, earnings likely to be flat for the rest of the year, so we are on the high end.  A lot of earnings growth is from share buy backs over the last 4 years.  Is the market respecting support and resistance levels – no.  He believes we are in a bear market.  He believes we will retrace to around the 1600 level (25% from the peak).

NORTH AMERICAN - LARGE & ETFs
2016-03-07 Larry Berman CFA, CMT, CTA

Educational Segment.  Negative Interest Rates.  The yield to maturity in the world in bonds is 1%.  The central bank in the US controls short interest rates as well as to supply and drain liquidity from the marketplace.  Quantitative easing is a more permanent operation.  He believes interest rates will stay low for some time.  US debt to GDP shot up during the Ragan years.  Then in the Lehman moment, they borrowed 9 trillion dollars. 

NORTH AMERICAN - LARGE & ETFs
2016-02-29 Larry Berman CFA, CMT, CTA

Educational Segment.  Super Tuesday.  The political establishment is mortified at what Donald Trump has been able to do.  You have this rip in the party.  Texas is key here.  Trump has been able to win because the Republican party is split.  Texas is tomorrow night (Super Tuesday).  After that Trump may be able to be challenged.  He has not said one thing that is economically decent.  The markets are not likely to go down on Wednesday because you have the March 10th ECB announcement.  Then you want to wait for March 15th, after that volatility will increase.  You want to take down the risk after the 15th.

NORTH AMERICAN - LARGE & ETFs
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
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