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COMMENT
COMMENT
January 2, 2019
Market Outlook First trading day of the year. The market started trading down again. December was a normal correction to start, but got worse. An 800 point down day on the Dow is not of too concern when you consider the overall level of the market. One should have a strategy to deal with higher market volatility. He is going to re-balance his portfolio and will avoid buying junk (like cannabis and bitcoin stocks).
General Market Comment
January 2, 2019
Market Outlook First trading day of the year. The market started trading down again. December was a normal correction to start, but got worse. An 800 point down day on the Dow is not of too concern when you consider the overall level of the market. One should have a strategy to deal with higher market volatility. He is going to re-balance his portfolio and will avoid buying junk (like cannabis and bitcoin stocks).
John Hood
President & Portfolio Manager, J. C Hood Investment.
COMMENT
COMMENT
January 2, 2019
Are covered calls safe in a down market? Covered call righting only protects a very small amount of your capital -- it is only there to generate income -- it is not a hedge. He has sold ZWH-T as he does not want to sell covered calls in a recovering market as it has sold off the upside potential. He might just consider outright buying banks stocks at this point. In a flat market or rising market covered calls are a good strategy.
General Market Comment
January 2, 2019
Are covered calls safe in a down market? Covered call righting only protects a very small amount of your capital -- it is only there to generate income -- it is not a hedge. He has sold ZWH-T as he does not want to sell covered calls in a recovering market as it has sold off the upside potential. He might just consider outright buying banks stocks at this point. In a flat market or rising market covered calls are a good strategy.
John Hood
President & Portfolio Manager, J. C Hood Investment.
COMMENT
COMMENT
January 2, 2019
Buy puts when the market is going down? When buying options (buys or puts) remember that time is your enemy due to price erosion. Rather he looks to buy options ahead of market reaction to a specific event -- like the earnings season. He thinks buying and holding options for an extended is not a good strategy as you can lose 75%-100% of your capital.
General Market Comment
January 2, 2019
Buy puts when the market is going down? When buying options (buys or puts) remember that time is your enemy due to price erosion. Rather he looks to buy options ahead of market reaction to a specific event -- like the earnings season. He thinks buying and holding options for an extended is not a good strategy as you can lose 75%-100% of your capital.
John Hood
President & Portfolio Manager, J. C Hood Investment.
COMMENT
COMMENT
January 2, 2019
When to own Covered Call ETFs? Only until recently would he suggest moving out of coverall calls. However, right now he wants to own the outright equities. This is part of a strategy for volatile markets. He is afraid of giving away upside when the market recovers.
General Market Comment
January 2, 2019
When to own Covered Call ETFs? Only until recently would he suggest moving out of coverall calls. However, right now he wants to own the outright equities. This is part of a strategy for volatile markets. He is afraid of giving away upside when the market recovers.
John Hood
President & Portfolio Manager, J. C Hood Investment.
COMMENT
COMMENT
January 2, 2019
How do you select ETFs? He likes low MERs in general when looking for ETFs -- usually under 10 bps. Don't buy the "smart Beta" ETFs with higher MERs. Look at iShares, BMO and Vanguard websites for more specific information. He thinks many of the higher MER ETFs might close down as there are simply too many doing the same thing at higher costs. He thinks XIN-T is a good candidate for the European markets as an example.
General Market Comment
January 2, 2019
How do you select ETFs? He likes low MERs in general when looking for ETFs -- usually under 10 bps. Don't buy the "smart Beta" ETFs with higher MERs. Look at iShares, BMO and Vanguard websites for more specific information. He thinks many of the higher MER ETFs might close down as there are simply too many doing the same thing at higher costs. He thinks XIN-T is a good candidate for the European markets as an example.
John Hood
President & Portfolio Manager, J. C Hood Investment.
COMMENT
COMMENT
January 2, 2019
A typically volatile day today. It started ugly, but ended up. That's great, but this volatility needs to stop. He would love a couple of weeks of calm with Trump keeping his mouth shut, so we can build a bottom then go up. We'll get Q4 earnings soon. Oil prices helped today's rally, but PMI data from China was not good. Trump thinks he can--and needs to--fix trade tensions with China. There is a global growth slowdown, but there will still be growth this year. It will take a few weeks, at least, to find calm. If earnings are okay (the bar is so low), that will start to calm markets--and if Trump calms himself too. Markets no longer ignore him--they're paying attention because he effects trade.
General Market Comment
January 2, 2019
A typically volatile day today. It started ugly, but ended up. That's great, but this volatility needs to stop. He would love a couple of weeks of calm with Trump keeping his mouth shut, so we can build a bottom then go up. We'll get Q4 earnings soon. Oil prices helped today's rally, but PMI data from China was not good. Trump thinks he can--and needs to--fix trade tensions with China. There is a global growth slowdown, but there will still be growth this year. It will take a few weeks, at least, to find calm. If earnings are okay (the bar is so low), that will start to calm markets--and if Trump calms himself too. Markets no longer ignore him--they're paying attention because he effects trade.
Bruce Campbell (1)
President, Campbell and Lee InvMngmnt
COMMENT
COMMENT
January 2, 2019
Number one black swan worry? A recession way earlier than we think. He's not predicting this; black swans come out of left field. As long as the US Fed slows down and US earnings are okay (and he expects). He sees a recession in late-2020. But we've priced in a recession already lately.
General Market Comment
January 2, 2019
Number one black swan worry? A recession way earlier than we think. He's not predicting this; black swans come out of left field. As long as the US Fed slows down and US earnings are okay (and he expects). He sees a recession in late-2020. But we've priced in a recession already lately.
Bruce Campbell (1)
President, Campbell and Lee InvMngmnt