Latest Research

Based on our estimates of mutual fund inflows at various market levels, it looks like more fund owners are now under water. About $116 billion was invested in the market above current levels. Nervous but not panicked mutual fund investors.

On balance, latest week’s big block sells still outnumber the (record high) big block buys, but falling average providing some evidence of improving sentiment of corporate insiders.

There is a whole lot of volatility in the market currently, more than investors have come to expect...42% of Q3 days were high volatility.

New sector activated with a focus on the major oil companies from around the world.

We are activating the biotech sector in the Paid to Play Portfolio. The SS Score jumped to Attractive this month.

Phones, Drugs, Biotech, and Utilities among leading equity sectors in Q3.

August’s decline was the largest monthly decline since October 1987. Recommended Client Strategy: maintain most defensive equity stance available - if cash is not an option, concentrate in defensive equity sectors.

Steve’s personal judgements and opinions incorporating observations, experience and gut feelings, going beyond the quantitative aspects of the Major Trend Index disciplines.

Smaller can managers are expected to see better times ahead. We predict that the next bull market will be led by small cap stocks. Historically, small caps now look fairly priced.

As of the latest reading (week ending August 31), the normalized 10-week average was back into extreme net selling territory.

Weekly inflows for the month of August were positive in the early part of the month, but quickly turned to net redemptions as the market fell. The data demonstrates that investors continue to buy on strength. They don’t buy the dips!

Amazingly, nine of twenty one trading days in August were high volatility days (1% or greater move).

Unless earnings begin to show strong signs of growth (not evident at present), the stock market is clearly still ahead of itself (even after the August decline).

S&P 500 and DJIA down 15% in August, but outperformed 75% of 84 sectors.

Bear market or steep correction? Rising inflation could actually be good for equity market over next few years. FASB arrives at a decision which could spell the end to the repricing options practice by making it prohibitively expensive.

Most investors, including professionals, find it emotionally dif­ficult to act independently and contrarian. It is emotionally comforting to be in tune with the consensus....after all, going with the consensus won’t get you fired.

T-bond ahead of itself, fueled by flight to credit quality...Yields could back up should Asia outlook improve, or equity market rally significantly.

The second half of 1998 got off with a thud for most managers. It is becoming increasingly evident that we are in a two tiered market—the only positive relative performance is from the largest of the big cap “growth” stocks.

Major Trend back to Negative...Both Asset Allocation Portfolios shifted to their most defensive posture ever. Steve's judgements and opinions on major stock market positives and negatives.

This month, we plan to add the First Philippines Fund to our Unconventional Portfolio.