Market Timing, Even by Experts, Pays Off Only Modestly

The advice typically given to investors is to “ignore the level of the stock market and never attempt to time it. Meanwhile, “writes Bloomberg columnist Nir Kaissar, “the industry’s brightest lights are doing just the opposite.” Kaissar cites participants in the recent CNBC Institutional Investor Delivering Alpha Conference who argue that a market correction is in the offing. These include Paul Tudor Jones, Jeffrey Gundlach, and Howard Marks, to name a few. “So, which is it,” writes Kaissar: “Should investors attempt to time the market or not?” He outlines a few considerations to focus on: Most investors are “horrible” at […]

Investing Lessons from 2016 that Ben Graham May Give a Nod To

It’s the time of year when holiday party-goers lament their seasonal overindulgences and commit to “turning over a new leaf” on January 1st— promises to hit the gym every day, clear the pantry of junk food and turn off devices during family time are among the hopeful resolutions traded over hors d’oeuvres and prosecco. It’s also a time for reflection on the year that’s passed and setting in place a plan for the year ahead. When it comes to investing, a good way to prepare for the year ahead is to take inventory of the events, trends, and missteps that […]

The Trump Rally, Market Timing and Picks

The post-election surge in stocks underscores the risk inherent in trying to time the market. In a recent article for TheStreet, Validea CEO John Reese discusses how investors, by “falling victim to elections, emotions or headlines” can miss out on returns. The goal, he argues, should be to invest in fundamentally sound businesses and avoid “jumping in and out of the market due to knee-jerk, emotional reactions.” Using his guru-based stock screening models, Reese identifies the following five picks: Fujifilm Holdings (FUJIY) develops, produces, sells and services document, imaging and information solutions. The company’s robust top line and strong liquidity […]

Avoid Investing Inertia

When investors sit on the sidelines in fear of “missing out,” that may be precisely what they end up doing, says Allen Roth in last month’s Wall Street Journal. Roth, founder of the financial planning firm WealthLogic, says “over the past several years, many people have come to me with cash-heavy portfolios,” citing a host of reasons including the pending election, global turmoil, and interest rates. According to Roth, however, this mindset is really a veiled attempt to time the market and these investors are “losing the fight against the most powerful force in the universe—inertia.” Roth advises clients to […]

Market Timing Indicator Kicks off Rare Buy Signal

Most would agree that valuations in the current mature bull market make buying equities a bit less alluring than they were, say, when the U.S. was emerging from the 2008 global financial crisis. However, according to a MarketWatch article by Mark Hulbert, an indicator referred to as the Coppock Guide is suggesting that the potential still exists for “significant returns.” Edwin Coppock was a technical analyst who proposed his market-timing model in an article for Barron’s in 1962. Hulbert explains it as a “momentum indicator that filters out shorter-term market swings to focus on the market’s long-term trend.” He says the calculation […]