How We’re Responding to Market Events
With markets still reeling from a volatile week, Pinnacle Chief Investment Officer Rick Vollaro surveys the financial evidence and describes how we’re responding in our portfolios.
What’s Going on with the Market?
It is hard to believe that in three trading days, the market has penned its first 10% correction in over 900 trading days. This decline may be an unfortunate reminder of the last bear market, and if you are feeling anxious about your portfolio, don’t worry—you have lots of company. In fact, the market has set a new record for the speed and breadth of market volatility.
Not only has the market dropped, but we have also witnessed several areas of the evidence we follow move into bearish territory. Given this recent downgrade, we now believe the probabilities are high that we are transitioning from a bull market to a bear market cycle.
In the remainder of this post, I’ll summarize our response to the recent market events in each of our three Pinnacle strategies.
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Six Questions to Ask Before Buying That Vacation Home
With a humid mid-Atlantic summer in full swing, many Marylanders are entertaining the idea of purchasing a vacation home. That might be wise — it can be a great place to rejuvenate and spend time with family and friends.
However, a vacation property also comes with its own set of challenges and those considering a purchase should be aware of them. With that in mind, here are six important questions to ask before making the move.
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Will Greece Trip Up the Bull?
The headlines out of Greece are coming fast – deal, no deal, default, referendum, etc. It’s enough to make investors’ heads spin trying to keep up with the news flow. Markets have been volatile this week in reaction to the back and forth, and the rising possibility that Greece may leave the Eurozone. Investors are starting to fear that this could potentially be another “Lehman moment” that results in financial contagion across global markets.
DetailsVIDEO: Markets, Positioning, and Themes
In this Pinnacle Market Update, Chief Investment Officer Rick Vollaro looks at the mixed economic evidence and outlines our investment position.
No Pain, No Gain – Taking the Long View on the Dollar and Commodities
“Long ago, Ben Graham taught me that price is what you pay; value is what you get. Whether we are talking about socks or stocks, I like buying quality merchandise when it is marked down” – Warren Buffett
We pointed out in our recent quarterly commentary that a major countertrend movement was brewing in both the dollar and commodity patch. In other words, the primary trends for the dollar (up) and commodities (down) might have hit a point where their respective gains and losses were overdone in the short-term, but we have a firm conviction that the strong dollar and weak commodity thesis should continue to dominate the backdrop in the long-term.
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Pondering Halftime Adjustments
At the beginning of the year, we wrote about an aging bull market that we thought could be ridden, but with the caveat that one wouldn’t want to take too much risk given the magnitude of the move, current valuation levels in the U.S., and an overall evidence profile that was clearly mixed with pockets of both strength and weakness. When weighing the evidence, our dashboards offered no reason to reach for additional risk this late in the cycle, but instead we tried to focus on some big picture themes that could help us find attractive opportunities to position for.
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How To Get More From Your Tax Preparer Next Year
With tax-filing season behind us, I’ve heard a lot of people express disappointment in the way their taxes were done. The complaints are not only from clients – tax preparers are also feeling frustrated with the process.
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Make or Break Time for Transportation Stocks
We’ve been looking at transportation stocks as an intra-industrial sector investment, due to a variety of factors: our forecast for a secular bear market in crude oil, sustainable airline profits, and high domestic exposure as compared to multi-national industrials hurt by a strong dollar. Nevertheless, transportation stocks have had a rough start to the year. As a market technician, I look to charts to tell us when we’re wrong.
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Treat Your Finances Like the NFL Draft
It’s the middle of April, and the 2015 NFL draft is quickly approaching.
This means aspiring professional football players have made their way to the NFL scouting combine, where talent evaluators have scrutinized their speed, strength, and agility. General managers and coaches are looking at both their existing rosters and the young players hoping to fulfill a lifelong dream by being drafted into the NFL.
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