Green Book January 2019
The Line Of Least Resistance Is Lower
At some point in his career, famed stock trader Jesse Livermore ceased using the terms bull and bear, opting instead to describe trends in terms of “lines of least resistance.” He felt the change in terminology enabled a more flexible, unbiased mindset.
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Featured Articles
The Market Is Off Its Meds!
While investors obsess over the market level at which a hypothetical “Powell Put” might come into play (or whether such a put even exists), they seem to have overlooked the absence of another such put that proved dependable throughout the cyclical bull market.
December’s Low Didn’t Have The “Right Look”
As the market sunk to a 3% loss on Christmas Eve, we sensed genuine investor panic—at least among the fraction of investors then paying attention.
Industry Group Dreams And Nightmares
The “Dreams” portfolio represents a simple industry group trend-following approach, while the “Nightmares” portfolio serves as a bottom-fishing strategy made up of the previous year’s biggest losers.
Housing Affordability & Homebuilding Stocks
The Homebuilding stocks represent another Consumer Discretionary group ranking Attractive via our GS Scores; we have held the Homebuilding group for the last year and a half. Homebuilders is an extremely rate-conscious industry group given mortgage rates’ impact on housing affordability (and thus, demand).
Incongruities In High Quality
Quality is one of the most popular and successful of the smart beta factors. It is intuitively appealing and serves as a useful defensive strategy in market drawdowns.
Corporate Executives Might Be Peeking Into Quants’ Toolkits
In terms of long-term planning, corporate executives are often tasked with choosing between expanding their business or returning cash as a way to reward shareholders. In the quant world, the two decisions have a consequence on future stock returns.
Momentum Negative In Q4, But Positive For 2018
2018 was frustrating for most investors as Value continued to struggle and positive Momentum performance was difficult to capture. Small Caps, Mid Caps, and ADRs also underperformed.
Table of Contents
Stock Market
- Industry Group Dreams And Nightmares
- The Line Of Least Resistance Is Lower
- Is The “Star” Aligned For 2019?
- About That Great Jobs Report...
- The Market Is Off Its Meds!
- Yields Might Be Throwing A Curve
- The Fed Was Not The Only One To Tighten Last Month
- December’s Low Didn’t Have The “Right Look”
- Watching For An Internal Washout
- You Call That A Panic?
- Guess-timating The Downside
- “De-Worsification” Ruled In 2018!
- Read This Before Taking The “Plunge”
- Bridesmaid Strategy - Asset Classes
- Bridesmaid Strategy - Sectors
- Bridesmaid Strategy - Valuations
- Corporate Executives Might Be Peeking Into Quants’ Toolkits
Of Special Interest
Macro Monitor
- Tightening And Trade Risks Still Underestimated
- 2019 Time Cycle—Hope Springs Eternal
- Risk Aversion Index: New “Higher Risk” Signal
Equity Strategies
Quant
Market Internals
Portfolios
Major Trend
Fund Flow Trends
Estimating the Downside
At Random
The Market Is Off Its Meds!
While investors obsess over the market level at which a hypothetical “Powell Put” might come into play (or whether such a put even exists), they seem to have overlooked the absence of another such put that proved dependable throughout the cyclical bull market.
December’s Low Didn’t Have The “Right Look”
As the market sunk to a 3% loss on Christmas Eve, we sensed genuine investor panic—at least among the fraction of investors then paying attention.
Industry Group Dreams And Nightmares
The “Dreams” portfolio represents a simple industry group trend-following approach, while the “Nightmares” portfolio serves as a bottom-fishing strategy made up of the previous year’s biggest losers.
Housing Affordability & Homebuilding Stocks
The Homebuilding stocks represent another Consumer Discretionary group ranking Attractive via our GS Scores; we have held the Homebuilding group for the last year and a half. Homebuilders is an extremely rate-conscious industry group given mortgage rates’ impact on housing affordability (and thus, demand).
Incongruities In High Quality
Quality is one of the most popular and successful of the smart beta factors. It is intuitively appealing and serves as a useful defensive strategy in market drawdowns.
Corporate Executives Might Be Peeking Into Quants’ Toolkits
In terms of long-term planning, corporate executives are often tasked with choosing between expanding their business or returning cash as a way to reward shareholders. In the quant world, the two decisions have a consequence on future stock returns.
Momentum Negative In Q4, But Positive For 2018
2018 was frustrating for most investors as Value continued to struggle and positive Momentum performance was difficult to capture. Small Caps, Mid Caps, and ADRs also underperformed.
Stock Market
- Industry Group Dreams And Nightmares
- The Line Of Least Resistance Is Lower
- Is The “Star” Aligned For 2019?
- About That Great Jobs Report...
- The Market Is Off Its Meds!
- Yields Might Be Throwing A Curve
- The Fed Was Not The Only One To Tighten Last Month
- December’s Low Didn’t Have The “Right Look”
- Watching For An Internal Washout
- You Call That A Panic?
- Guess-timating The Downside
- “De-Worsification” Ruled In 2018!
- Read This Before Taking The “Plunge”
- Bridesmaid Strategy - Asset Classes
- Bridesmaid Strategy - Sectors
- Bridesmaid Strategy - Valuations
- Corporate Executives Might Be Peeking Into Quants’ Toolkits
Of Special Interest
Macro Monitor
- Tightening And Trade Risks Still Underestimated
- 2019 Time Cycle—Hope Springs Eternal
- Risk Aversion Index: New “Higher Risk” Signal