About That Oil & Stock Market Correlation

The price of oil seems to be at the forefront of every market and economic conversation these days. That tends to happen when one of the most important commodities on the planet falls 80% in a short period of time. Is it too much supply? Not enough demand? The pricing in of future technological advancements? Speculators?…

The Process of Judging an Investment Process

A couple weeks ago I looked some of the reasons behind the fact that smart money tends to chase past performance. I received a couple of good follow-up questions from people in the industry who were curious about my thoughts on how to judge a portfolio manager or investment process.

The Fear Principles

Yesterday was a wild day in the markets. There was a huge gap down at the open, which followed through into the afternoon. Then there was a huge rally late in the day with another minor slide into the close. The NASDAQ was down 3.65% at the low of the day by lunch time. At 3:30…

Stock Market Sell-Offs Without a Recession

The stock market is a forward-looking indicator. Markets are meant to discount future cash flows and events to a present value. It’s not always right — stocks have predicted four out of the last eight recessions and so on —  but investors are constantly looking for signals in stock prices to shape their current outlook….

“We have no idea”

As they are wont to do on occasion, the markets are in the mist of a decent sell-off. The last 6 months or so have not been kind to the global markets. The S&P 500 is holding up surprisingly well in the face of much deeper losses in small caps, foreign stocks and emerging markets:

The Bedrock of Portfolio Management

Investors often spend much of their time thinking tactically instead of psychologically. They want to know how to handle the next week or month in the markets without ever planning for the next year or decade.

Why The Smart Money Chases Performance

The fund I used to work for was invested in an investment manager that performed very well in 2008 when the majority of asset classes and portfolio managers were getting destroyed by the financial crisis and stock market collapse. This particular strategy was up double digits in a year when stocks fell close to 40%. This…