Latest Research

Low quality stocks led out of the past bear market, as typically occurs. Despite being the clear winners from the 2009 lows, it looks like the lower quality stocks can continue to outperform given current valuations and momentum.

It’s a big mistake to react to the headline reports of employment, and an even bigger mistake to make investment decisions based on them.

Offerings are beginning to pick up. While not even near the levels of excess, the trend bears watching. The initial surge in offerings is typically indicative of a rising market.

A new Select Industries Portfolio holding in Railroad group was established.

It does not look like a very good “Playing The Bounce” year. Many fund managers still have substantial tax loss carry forwards they can use to offset this year’s gains.

Factor analysis shows that Momentum continued to be effective in November. Also, aggressive equity sectors have been outperforming the defensive ones. Both of these factors bode well for a continuation of the bull market.

Chun Wang examines QE I & II in Japan, along with the initial QE in the U.S., to see how various quantitative factors have reacted in the past. While some factors may prove effective, the main difference between these past QE experience and the latest round is the macro conditions of the market.

Stocks win the bonds versus stocks comparison.

The bond bubble could be deflating, as investors demand higher yields to compensate for expected rising inflation and the U.S. mountain of debt.

This month’s “Of Special Interest” takes a look back at and updates some our favorite charts from 2010.

Now that the election is over and QE2 in the works, resist the temptation to “sell the news.” We expect to see the market rally through the end of the year. Sentiment still benign and valuations still attractive.

Not much happening with this year’s edition of “Playing The Bounce.” Initial list of qualifiers posted a loss of 1% in October, while the S&P 500 was up 3.7%.

YTD the winner is momentum! This is slowly developing to the angst of many model-tweekers. Note though that how one defines momentum can make a difference in what you see.

Chun Wang uses the CRB Index as a risk proxy to test the effectiveness of a range of quantitative factors in various environments. Commodity prices have become an increasingly important measure of risk, since higher commodity prices indicate a greater risk appetite and vice versa.

Bond bubble continues to inflate, much like money pouring into tech stocks at the height of the internet bubble.

All our asset allocation portfolios have commitment to gold and silver. This month’s “Of Special Interest” focuses on the yellow metal. Valuation matrixes are of little use, but we do present a variety of relationships that may help at least understand the price movements of gold.

The kneejerk reaction to worries about excessive sovereign debt has been to bail out of the European sovereign debt and pile into U.S. sovereign debt. Unless the U.S. can get its own fiscal act together, we may face this same panic reaction farther down the road.

“Playing The Bounce” season is once again upon us. This is a tactical trading strategy designed to identify beaten-down stocks which come under heavy selling pressure at year end. When selling abates, stocks tend to “bounce.”

Major Trend Index now Positive (both global and domestic). Even though we are bullish, there are several bullish arguments that we still don’t buy.