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A Comment -- General Comments From an Expert (A Commentary)
COMMENT
While most stocks are flat or down, big tech has gotten ahead of themselves, so the recent sell-off was needed. Her picks today will be defensive. Ahead, there is Covid uncertainty with lockdowns possible and the looming U.S. election. Defensives include income stocks and consumer staples whose valuations are far more reasonable than the momentum stocks. We saw a very fast recovery this year. It's difficult to time the market. if you had sold at the (March) bottom, it's hard to chase and get back in. Six months after March, some highs have surpassed those March highs. She owns financially sound companies, even though their share prices may drop in the near term, but will ride out this storm and come out well in the end.
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Federal Reserve. He doesn't think the Feds will do much at their meeting this week. However, there is talk about the huge liquidity that they have put into the economy. Yield curve control and long term low interest rates will be a focus. Europe and Japan have been doing similar quantitative easing and yet they do not have markets at all time highs. If we look closer, we see that the rise is mainly due to FANG stocks and not the general market.
Larry Berman CFA, CMT, CTAUnknown
COMMENT
Educational Segment. There has been a massive amount of small investors playing the option markets. There has been hedge buying that has propelled stocks up. Although there is a lot of exciting developments in tech, earnings growth has not kept up with stock price. There is rampant speculation from non-institutional investors on companies like Apple. We must wait for pullbacks. He would write a put for $80 a year from now for Apple to be paid while you wait.
Larry Berman CFA, CMT, CTAUnknown
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Market. The party is not over on these giant FANG stocks. Those that cater to working away from the office will do well. He does not think companies are pulling employees back into the office in great numbers. Multiples on tech stocks around the world are high. The sector has done incredibly well globally. Canadian tech stocks have done well, although the oil sector has not. There could be a directionless market until the US election, while infection rates will go up. You are going to see a lot more volatility in the markets. The VIX makes it look like people are complacent, but in fact they are worried. You may see pullbacks.
Paul Harris, CFAUnknown
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Oil Sector and Impact from E-cars. He thinks they will continue to grow over the next little while. TSLA-Q is not the only one. GM, Ford and all the majors are coming out with electric vehicles. Tesla has grabbed the imagination of consumers. He thinks E-cars will be more and more of the auto industry. It is hard to recommend getting out of the oil business just because of E-cars. The oil curve is still in co tango. Hydro carbons are not going away tomorrow.
Paul Harris, CFAUnknown
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Billy Kawasaki’s Insights - Picks from 5i Research. We saw a sharp sell-off in March and the tech sector recently sold off by up to 10%. It’s hard to predict when the next correction might come. We might see more volatility because of the US elections, but 5i does not expect a sharp correction. Unlock Premium - Try 5i Free
Stockchase InsightsUnknown
COMMENT
Stock splits Some believe that stock splits create value, but that's not true. Splits allow retail investors to enter, because shares are more affordable to newbie investors. Tesla and Apple are examples where existing shareholders sold a few shares after the split. The time to buy would have been a little time after the split, the post-split pullback, and not immediately when there is a new influx of buyers, as we saw recently.
COMMENT
Year to date, 30 stocks are up more than 100% and another 90 stocks are up more than 40%. However, none of the big 5 have gone up by 100%. The 5 top stocks are up because of speculation from better margins, faster sales and earning growths and less debt. The market is probably stretched. The bond yields will probably go higher. Equities are technically overbought. Trading below the 50-day moving average would signal a correction of around 11%.
Robert McWhirterUnknown
COMMENT
The correction may last over 1-2 months, but stocks should rise over the course of the year. There is no other alternative because of low yields from bonds. Stocks offer a compelling argument against bonds or short-term money. Looking at price to earnings growth, the big names are still at reasonable levels.
Robert McWhirterUnknown
COMMENT
Billy Kawasaki’s Insights - Picks from 5i Research. Today’s picks include Canadian technology as well as a Brookfield fund. The Nasdaq has tumbled whereas the TSX saw a lift to finish off the week on a high note. Unlock Premium - Try 5i Free
Stockchase InsightsUnknown
COMMENT
Volatile markets these days. Tech started strong today then fell. But this volatility won't last. New investors who jumped in will get a rude awakening this month and bow out. When stocks go down, they go down hard. That's why you need to hold cash....Housing has been strong given low rates and government support. Will Lennar turn offices into houses, given the flight to the suburbs? Drug stocks have been horrendous lately given political pressure, but everyone is focused on the vaccine race. But how do you make big money off the vaccine if governments will limit that cost? The market badly needs another stimulus package, which will lift this market doldrum.
COMMENT
The recent sell-off Historically, September strikes fear in investors. We some tremors mid-last week in tech stocks. There are three meanings: 1) the ghost of September is haunting us and foretelling volatility in the COVID year and amid U.S. elections; 2) the cracks in the tech stocks foreshadows a long-awaited rotation into growth and cyclical stocks; and 3) the recent sell-off means nothing at all and sell-offs in FAANGs like Apple are a blip as these stocks continue to rise. Make sure your portfolio is positioned for any of these fates.
COMMENT
Silver outlook after recent run-up He's not a commodities expert, but gold and silver are in primary bull markets. Gold is enigmatic, especially--so, obey what the charts tell you. This means, when gold makes moves, it makes BIG, bold moves, not small ones. Gold could go much higher in years to come. Silver is like high-beta gold with fewer markets and less participation from central banks and ETFs. Silver has more industrial uses than gold, so if there's a broad recovery, silver should do well. We're in the early stages of a recovery, and he expects gold and silver to do well.
COMMENT
When to sell a stock? First, you'll be right and wrong when selling stocks in your lifetime. Don't be emotional over a loss, but determine why--important. Other times, take profits when you have a major winner, but keep a core position. Other times, you rightly thought that a stock would grow, but now the valuation is rich and the catalysts for growth have gone--take your winnings and buy something better.
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