1,316 results found
Daily Market Commentary
The market seas are calm, but beneath the surface, there is some intense churning, or in market terminology, significant stock rotations. Over the last week, the Dow, S&P 500, and Nasdaq were relatively flat. Such gives the appearance of a low volatility, typical late August market with little going on. However, beneath the calm of […]
Daily Market Commentary
Nearly $3 trillion of notional stock options expire on Friday’s open expiration (OPEX day). Over half of the OPEX volume is in S&P 500 options, with the remainder in single stock options. The graph below provides details on the split between puts and calls, and the strike prices and open interest of the options. Almost […]
Daily Market Commentary
In Warren Buffett’s Berkshire Hathaway’s latest SEC disclosures, the company reported buying a nearly $1 billion stake in homebuilders Lennar (LEN) and D.R. Horton (DHI). The purchases signal anticipation of a housing market rebound, possibly piqued by the possibility of the Fed starting a rate-cutting regime. However, while Buffett appears confident of the new home […]
Daily Market Commentary
Since 2015, the performance of the S&P 500 has been more than double that of stocks from the Euro STOXX 50 (FEZ) and the iShares developed markets ETF (EFA). However, recently the tide has turned, and the Euro and broader foreign stock indices are beating the S&P 500. The recent outperformance and significant valuation differences […]
Economics
Mainstream commentary repeats a simple refrain: “Buybacks return capital to shareholders.” The logic sounds convincing. A company reduces its outstanding shares, giving each shareholder a larger slice of the earnings pie. But as I’ve discussed in past work like “Stock Buybacks Aren't Bad, Just Misused,”
Daily Market Commentary
Edward Harrison of Bloomberg recently made the following important market observation: “buying stuff you don’t believe in creates downside risk.” Conviction is a measure of how much investors believe in their holdings. When conviction runs high, investors are often more willing to tolerate lower prices. In fact, some may add to their positions at lower prices. […]
Invest
When it comes to managing wealth, especially for high-net-worth families and business owners, investment decisions can feel overwhelming. Market volatility, emotional reactions, and competing priorities can quickly lead to inconsistent choices that erode long-term success. That’s where an Investment Policy Statement (IPS) comes in. Yet despite its value, many investors skip this crucial document, unknowingly […]
Daily Market Commentary
Since the Pandemic, markets have been behaving abnormally. One such instance is a somewhat regular occurrence of bad market breadth. In other words, the market-cap weighted S&P 500 drives higher, yet fewer and fewer stocks are participating in the rally. For instance, in Monday’s Commentary, we discussed the current instance of bad breadth. To wit: […]
Invest
How was the weather yesterday in the United States? You could answer by citing an average temperature or precipitation level. However, doing so would severely misrepresent the weather in many parts of the country. Similarly, the typical response to “What did the market do today?” is often to quote the change in the S&P 500 […]