Horan - Health. Wealth. Life

Bond Funds Continue To See Inflows

Posted by David Templeton on Sunday, August 10, 2014 in Wealth Management | Comments (0)
Last week's mostly negative market, until the sharp recovery on Friday, continues to negatively influence investor's market sentiment. Last week's American Association of Individual Investors reported bullish investor sentiment fell slightly to 30.9%. This bullishness level is nearly nine percentage points below the long term average of 39%.From The Blog of HORAN Capital AdvisorsSource: AAIIAn interesting factor reported in the Sentiment Survey was the 7.1% increase in bearish sentiment to 38.2%...  Read more...
Almost a year and a half ago the Bank of Japan stated it would embark on a massive stimulus plan, i.e., quantitative easing, that would amount to the equivalent of $107 billion US dollars. Many strategists have taken a positive view of this effort by Japan to stimulate the country's economy. The near term, immediate impact to Japan's stock market at that time, the Nikkei 225 Index, was a dramatic move to the upside. As the below chart shows (two year time frame), the Nikkei was up over 80% from ...  Read more...

Why To Invest In Stocks

Posted by David Templeton on Wednesday, August 06, 2014 in Wealth Management | Comments (0)
I wrote an article this past weekend that provided a link to an interview with Jason Trennert conduct by Consuelo Mack of WealthTrack. The theme of the interview and the post is the belief there currently is no alternative for investors other than stocks. My article was republished on Seeking Alpha and a reader responded with several comments and questions. I responded to his questions and the reader thought the response was worthy of an article of its own. Below are the reader's questions/comme...  Read more...

Massive Bearish Put Volume On Friday May Have Been An Error

Posted by David Templeton on Monday, August 04, 2014 in Wealth Management | Comments (0)
Over the weekend we noted the big spike in the put/call ratio to 1.04. Generally, when the put/call ratio exceeds 1.0, from a contrarian perspective, this overly bearish activity can be a positive for stock prices. Was the increased volume an error?Reuters is reporting the trades could be an error. In the article lead in they note, n">"A barrage of bearish options contracts costing an estimated $8 million and set to expire worthless in a few hours were purchased across multiple stocks Friday aft...  Read more...

Dividend Payers Underperformed In July

Posted by David Templeton on Sunday, August 03, 2014 in Wealth Management | Comments (0)
Much is made by some investment managers that dividend payers hold up well in market downturns. Generally, we would agree that is the case; however, this performance advantage does not always bear out and one must look at the underlying cash flow of individual companies. A case in point is the performance of the payers in July.As the below table shows the average performance of the payers underperformed the non-payers by almost two full percentage points. On a year to date basis the average retu...  Read more...

Week Ahead Magazine: August 3, 2014

Posted by David Templeton on Sunday, August 03, 2014 in Wealth Management | Comments (0)
With July in the books, investors experienced the negatives of what tends to be a weak seasonal period for the equity markets. The worst performing segment of the U.S. market continued to be the pullback in small company stocks as represented by the Russell 2000 index. Small caps declined 7.3% in July while the larger cap stocks represented by the S&P 500 Index fell 2.8%. Small caps are now down 4.2% year to date while the S&P 500 Index remains higher by 4.2%.For the most part economic news this...  Read more...

No Alternative Other Than Stocks

Posted by David Templeton on Saturday, August 02, 2014 in Wealth Management | Comments (0)
Consuelo Mack of WealthTrack recently interviewed Jason Trennert, Managing Partner and Chief Investment Strategist of Strategas Research Partners. As WealthTrack notes, "Trennert is widely followed by institutional investors in the money management and hedge fund world, and is identified as one of “Wall Street’s Best Minds” by Barron’s."In the interview, Trennert believes several factors are leaving investors with no investment alternatives other than stocks. Two reasons he cites are one, fina...  Read more...

Equity Put/Call Ratio Spikes To Above 1.0

Posted by David Templeton on Saturday, August 02, 2014 in Wealth Management | Comments (0)
In our earlier post today we noted the potential oversold conditions in the equity markets. When reviewing other technical data this morning, I was surprised to see the large jump in the CBOE equity put/call ratio on Friday which put the ratio above 1.0. We have noted in prior posts over the years that this sentiment ratio is most predictive of future market direction when the ratio is at extreme levels. In short,The equity P/C ratio tends to measure the sentiment of the individual investor by d...  Read more...

Market Looking Oversold

Posted by David Templeton on Saturday, August 02, 2014 in Wealth Management | Comments (0)
Both the New York Stock Exchange Index (NYA) and the S&P 500 Index (SPX) are down from their recent highs 3.7% and 3.2%, respectively. Although the magnitude of the declines is not large, the indices are looking oversold. The relative strength index, the MACD indicator and the stochastic indicator are indicating oversold levels as well. It should be noted that the MACD is less useful as an oversold market indicator as it is unbounded. The MACD is most useful in determining market turning points ...  Read more...

Is This The Much Awaited Market Pullback?

Posted by David Templeton on Thursday, July 31, 2014 in Wealth Management | Comments (0)
Today the S&P 500 Index fell 2% and this takes the Index into negative territory for the month of July: -1.51% on a price only basis. For the year the S&P 500 Index remains in positive territory, up 4.44% on a price only basis. The question for investors is whether this weak July and significant decline on the last day of July is a precursor to further market weakness. Answering the question may be important as a number of investors are waiting to "buy on the dip." Is July, and more importantly,...  Read more...
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