Market Trends

Invest with more confidence in less than 5 minutes per week 

Market Trends

Invest with more confidence in less than 5 minutes per week 

Most Popular: November 2021:

Investing with IBD

Investing with IBD
I had so much fun sharing billion dollar fund manager investment trends and stocks on the Investing With IBD podcast!
During my podcast appearance we discussed:
  • Will the economic growth in the U.S. continue? (min 1) 
  • ​How a Trend Roadmap can help you buy with clarity and sell with less worry. (min 14) 
  • Discover 3 stocks that billion dollar fund managers are buying. (min 30) 
In the 1960's William J. O'Neil, founder of Investor's Business Daily (IBD), turned $5,000 into more than $200,000 by uncovering the key qualities of the biggest market winners. O'Neil's investing process, the CANSLIM strategy, combines both fundamental and technical analysis to find stocks before they make their huge gains. 

I am a believer in William O'Neil's process and always recommend his book How to Make Money in Stocks to investors.
Trend Update 
The INVEST with RULES Trend Model maintains a HOLD signal for U.S. Stocks (SPY), International Stocks (VEU), U.S. Treasury Bonds (TLT), and Gold (GLD). 

To learn more about the differences between the free Market Trends signals vs. the more timely Inner Circle Membership alerts read the Q&A Section below. 
Q&A: What if the buy signal happened days, weeks, or months ago? 
A. The best option is to buy as close to the buy signal as possible. 

B. Another option is to buy in slowly over the next few days or weeks. This comes with added risk because the market may take off without you. Can you afford to miss out on what could be the best trend of the year?

C. The solution to this problem is INVEST with RULES Inner Circle Membership. The Inner Circle Membership delivers multiple, timely "BUY" signals whereas the free Market Trends email remains on "HOLD." 
The Inner Circle Membership provides multiple, timely "SELL" signals vs. just one. Simply receiving a "SELL" alert on the S&P 500 (SPY) on 2/25/2020 vs. waiting for the free signal on 3/6/2020, would have saved an investor +7.95% during a very volatile and stressful environment. 
But that is not the only reason why you should join...

I help self directed investors who are uncertain about what stocks to buy and when to sell. I deliver a little known, legal way to know what billion dollar fund managers are buying and selling so you can invest with more confidence. 

When you know what billion dollar fund managers are buying you can get in before they are done accumulating shares, inevitably pushing the price higher. When you know what huge fund managers are selling you can and get out before they sell and slam the price down. 

It's not enough to rely on just one guru or one fund. Or even three funds. You want to know what a significant collection of funds around the world are buying. That way the chance of being wrong is much less. 
The mission of the Inner Circle Membership is to deliver transformation, not just information. Knowing what stocks over a trillion dollars is flowing into and out of is the key to buying with clarity and selling with less worry so you can make meaningful progress towards your financial goals. 

If you want to be in the Inner Circle, then join the waitlist

If you liked this email please share it with someone you know who enjoys the market. See you next week! 
Join Market Trends Today...

Most Popular: October 2021:

Find Great Stocks By Being a "Cloner"

Find Great Stocks By Being a "Cloner" 
Mohnish Pabrai is an Indian-American businessman, investor, and philanthropist who has achieved an annual average return of +25.7% over the last 18 years

In 1991, Pabrai started an IT consulting company with $30,000 from his 401k and $70,000 borrowed off his credit card. He sold the company just 9 years later for $20 million. Today he is the managing partner of Pabrai Investment Funds, a $600 million dollar hedge fund inspired by Warren Buffett. 

Here are Pabrai's top 3 Investing Rules:
1. Be a "Cloner"
The simplest way to find great investment ideas is to copy them from the world's best investors. Pabrai says he is a shameless cloner and looks at 13F reports, where every quarter funds with over $100m reveal their holdings. He says, "Just figure out who the smart people are, look at what they're buying, and reverse engineer them." 

[Do you want to be a quicker "cloner" and find out what stocks billion dollar fund managers are buying before 13F reports?...Learn more about the Inner Circle Membership.]

2. Buy Stocks with a Moat
Just as a physical moat protects a castle from outside threats, a moat around a company makes it hard for competitors to enter the marketplace. Think Amazon Prime for shipping or Google for information.

3. Wait for the Right Pitch
Charlie Munger said, “You don’t make money when you buy and you don’t make money when you sell. You make money when you wait.”The biggest advantage of value investing is not intelligence, but patience and waiting for the stock to go on sale. 
Trend Update 
The INVEST with RULES Trend Model maintains a HOLD signal for U.S. Stocks (SPY) and International Stocks (VEU). It remains a SELL signal for U.S. Treasury Bonds (TLT). 

This past week something changed as Gold (GLD) triggered a shiny new BUY alert on Thursday, October 14th. 

Could this finally be the spark to set off much higher gold prices coming out of a 10 year "cup and handle" chart pattern?
Q&A: What if the buy signal happened days, weeks, or months ago? 
A. The best option is to buy as close to the buy signal as possible. 

B. Another option is to buy in slowly over the next few days or weeks. This comes with added risk because the market may take off without you. Can you afford to miss out on what could be the best trend of the year?

C. The solution to this problem is INVEST with RULES Inner Circle Membership. The Inner Circle Membership delivers multiple, timely "BUY" signals whereas the free Market Trends email remains on "HOLD." 
The Inner Circle Membership provides multiple, timely "SELL" signals vs. just one. Simply receiving a "SELL" alert on the S&P 500 (SPY) on 2/25/2020 vs. waiting for the free signal on 3/6/2020, would have saved an investor +7.95% during a very volatile and stressful environment. 
But that is not the only reason why you should join...

I help self directed investors who are uncertain about what stocks to buy and when to sell. I deliver a little known, legal way to know what billion dollar fund managers are buying and selling so you can invest with more confidence. 

When you know what billion dollar fund managers are buying you can get in before they are done accumulating shares, inevitably pushing the price higher. When you know what huge fund managers are selling you can and get out before they sell and slam the price down. 

It's not enough to rely on just one guru or one fund. Or even three funds. You want to know what a significant collection of funds around the world are buying. That way the chance of being wrong is much less. 
The mission of the Inner Circle Membership is to deliver transformation, not just information. Knowing what stocks over a trillion dollars is flowing into and out of is the key to buying with clarity and selling with less worry so you can make meaningful progress towards your financial goals. 

If you want to be in the Inner Circle, then join the waitlist

If you liked this email please share it with someone you know who enjoys the market. See you next week! 
Join Market Trends Today...

Most Popular: September 2021:

What's in Jerome Powell's Portfolio?

What's in Jerome Powell's Portfolio?
Jerome Powell is the head of the Federal Reserve aka the central bank of the United States. Powell controls the interest rate for short term borrowing and the money supply used to reduce inflation and ensure price stability. The goal is to maintain low unemployment and stable growth for the economy.

The Office of Government Ethics (OGE) requires Powell to disclose his income and assets. While the exact dollar value isn't disclosed, the broad ranges are. 

Charlie Munger, Vice Chairman of Berkshire Hathaway once said, "You show me the incentives, I’ll show you the outcome." So, what's in Jerome Powell's portfolio?
Powell's net worth is invested in a 60% stock allocation and he owns primarily US stocks and tax-efficient municipal bonds. Since his portfolio composition benefits from low interest rates don't be surprised if hikes do not come so fast. 
Trend Update 
The INVEST with RULES Trend Model maintains a HOLD signal for U.S. Stocks (SPY), International Stocks (VEU), U.S. Bonds (TLT), and Gold (GLD). 

Be ready because when the trend changes you will read it here in Weekly Market Trends!

Most Popular: August 2021:

Bitcoin vs. Gold

Bitcoin vs. Gold
As Bitcoin continues its meteoric rise towards $1 trillion market capitalization, more investors are comparing the popular cryptocurrency to gold. 

Many experts say both assets are a way to diversify against inflation, but in 2021 Bitcoin (BTC) is up +69% while Gold (GLD) is down -4%. That raises the question, which is the better investment?
Here is what some popular minds have to say:

Ray Dalio
Ray Dalio, famous billionaire and hedge fund founder of Bridgewater Associates, recently revealed “I own a very small amount of bitcoin. There are certain assets that you want to own to diversify the portfolio, and bitcoin is something like a digital gold. If you put a gun to my head and you said I can only have one, I would choose gold.”

Michael Saylor 
Michael Saylor, CEO of MicroStrategy (MSTR), took his company's cash and raised capital into 109,000 bitcoins. Saylor said, "Bitcoin is the first global real time clearing, decentralized, permission-less, immutable, scarce, transferrable, auditable, not seizable, highly divisible, secure, deflationary, transparent, synthetic gold - without the defects."

Frank Giustra 
Frank Giustra is a Canadian billionaire businessman, mining financier, and founder of Lionsgate Entertainment. He said "Gold is eternal - almost indestructible where jewelry today can be from 2000 years ago. Global government central banks own 20% of all gold ever mined in history. Investors will continue to turn to gold during times of inflation, stock market downturns, and times of crisis." 

Anthony Pompliano
Anthony Pompliano of Morgan Creek Digital Assets said, "Bitcoin is a 100x improvement over gold as a store of value. The world is realizing this and beginning to reprice digital currency in real-time. I suspect that bitcoin's market cap will surpass gold's market cap by 2030. For this reason, I own no gold and have a material percent of my net worth invested in bitcoin."

Mike Venuto
Mike Venuto, portfolio manager of Amplify Transformational Data Sharing ETF (BLOK), said "I would probably pick bitcoin but why not both?" 
Trend Update 
The INVEST with RULES Trend Model maintains a HOLD signal for U.S. Stocks (SPY), International Stocks (VEU), U.S. Bonds (TLT), and Gold (GLD). 

Be ready because when the trend changes you will read it here in Weekly Market Trends!
Join Market Trends Today...

Most Popular: July 2021:

Follow the Flows

Follow the Flows
Exchange traded funds (ETFs) must report the amount of money flowing in or out on a monthly basis, which provides valuable insights.
Bloomberg and State Street track over $5 trillion dollars worth of ETF flows and two weeks ago they reported that billions poured into the real estate sector and out of the financial sector.  

The real estate sector took in +$3.8 billion in June. 
The US Real Estate sector went out of favor during the pandemic, but has performed well so far year to date. The (XLRE) Real Estate ETF has outperformed the (SPY) S&P 500 by +11.08%.

The financial sector had outflows of -$1.4 billion in June.
Even though financial stocks experienced outflows in June, Financials still lead year to date with over $20 billion of inflows compared to all other sectors. The (XLF) Financial ETF leads the (SPY) S&P 500 by +7.15%.
Trend Update 
The INVEST with RULES Trend Model maintains a HOLD signal for U.S. Stocks (SPY) and U.S. Bonds (TLT) and it remains a SELL signal for International Stocks (VEU). 

This past week something changed and the INVEST with RULES Trend Model triggered a shiny new BUY alert for Gold (GLD) on Thursday, July 15th. 

Could this be the spark to set off much higher gold prices coming out of a 10 year "cup and handle" chart pattern?
Be ready because when the trend changes you will read it here in Weekly Market Trends!

Most Popular: June 2021:

The 1% Risk Rule

The 1% Risk Rule
Before you hit the "place trade" button and buy your next stock, have you predetermined your level of risk?

In a perfect world your investments will climb in value but in reality a percentage of your trades won't work. Instead of buying and hoping your stock will come back, what if it doesn't?  

It is important to calculate the amount of downside exposure by following a simple strategy called the 1% Risk Rule. 
The 1% Risk Rule helps investors keep capital losses to a minimum by limiting the risk on any single trade to no more than 1% of their total account value. The percentage may vary to fit ones personal investing risk tolerance. 

This is achieved by adjusting the position size in such a way that when a sell stop gets triggered, the total loss never amounts to more than 1% of the account value. 
 
I.e. If a portfolio total is $100,000 and each position starts at:
$10,000 then a -10% loss = -$1,000 or a 1% portfolio loss, or
$3,000 then a -33% loss    = -$1,000 or a 1% portfolio loss. 

The 1% rule is all about avoiding devastating losses which will allow one big winner to offset several smaller losses.
Trend Update 
The INVEST with RULES Trend Model maintains a HOLD signal for U.S. Stocks (SPY), International Stocks (VEU), and Gold (GLD). Last week U.S. Bonds (TLT) signaled a change from a SELL to a BUY. 

Given improving economic data and rising inflation trends I expect the BUY signal for U.S. Bonds to only last a short period of time. There have been times in the past where the bond market knows something before the stock market so it's important to remain vigilant. 

Be ready because when the trend changes you will read it here in Weekly Market Trends!

Most Popular: May 2021:

The Next "Big Short"

The Next "Big Short"
Dr. Michael Burry is the hedge fund manager who famously shorted the housing market before the 2008 crash, featured in Michael Lewis' book and the 2015 film "The Big Short." 

Burry is back with his next big short...Tesla (TSLA).  

He is betting against Tesla by investing $534 million (39.47% of his portfolio!) in put contracts that could see big profits if Tesla shares fall in value. So far in 2021 Tesla's stock price has fallen -17.68%.

Back in February Burry tweeted "If Tesla stock plummets 90% this year, it would put a stop to cult-like support of certain companies without endangering the financial system." He was referring to speculative betting on Tesla, Bitcoin, Gamestop, and other dangerous bubbles in the markets. 
In Michael Burry's Scion Asset Management, LLC has a reported $1.3 Billion under management. Burry also took a sizable short against (TLT), betting that interest rates will rise and the value of long term U.S. Bonds will fall. 

He was also buying Google/Alphabet (GOOG), Facebook (FB), and several energy, financial, and consumer staple stocks. 
Trend Update 
The INVEST with RULES Trend Model maintains a HOLD signal for U.S. Stocks (SPY), International Stocks (VEU), and Gold (GLD) and a SELL signal on U.S. Bonds (TLT).  

Be ready because when the trend changes you will read it here in Weekly Market Trends!

Most Popular: April 2021:

Senator Stock Picks

Senator Stock Picks
Sometimes I find interesting trends that are not directly from billion dollar fund managers, but they correlate to what they are buying and selling. For example, do you know which stocks your senators are buying and selling?

Many senators self-direct their accounts while others have their accounts managed by a third party. I always wonder if the inside knowledge of government activity translates within their portfolio. 

Whenever a senator, their spouse, or child makes a stock trade it must be publicly reported. Senate Stock Watcher, a nonpartisan website, aggregates the trading data.

Here are some recent interesting trends:
1. Auto Stocks
In February, John Hickenlooper, Senator of Colorado bought shares of Cargurus (CARG) and Dragoneer Growth Opportunities (DGNR). Cargurus is a car valuation and shopping site. Dragoneer Growth Opportunities merged with CCC Information Services, Inc., an artificial intelligence property and casualty insurance company that supports the car industry. 

Some might find it interesting that Dragoneer is run by Marc Stad, an early investor in Alibaba, DoorDash, and Spotify, but I find it interesting that Hickenlooper is on the senate committee on Transportation and he bought small stakes in two automotive stocks.  

First Trust NASDAQ Global Auto Index Fund (CARZ) tracks a basket of auto stocks. CARZ is up 12.85% year to date.
2. Financial Stocks
In March, West Virginia Senator, Shelley M. Capito bought 5 financial stocks United Bancshares (UBSI), U.S. Bancorp (USB), JP Morgan Chase & Co (JPM), Blackrock Inc. (BLK), and Wells Fargo & Company. She sold just one. Currently Capito serves on the committee on Financial Services. 

Financial Select Sector SPDR ETF (XLF) tracks a basket of financial stocks. XLF is up 19.35% year to date.
3. Semicondutor Stocks
In late February, Ron Wyden, Senator of Oregon bought shares of semiconductor makers Applied Materials (AMAT) and KLA Corp (KLAC). Just over a month later he took quick profits in all the chip makers he owned.

Today there are massive semiconductor shortages in products from TVs, mobile phones, and cars. Wyden is the current Chairman of the Senate Finance Committee serving International Trade, Customs, and Global Competitiveness. 

VanEck Vectors Semiconductor ETF (SMH) tracks a basket of semiconductor stocks. SMH is up 14.55% year to date. 
Trend Update 
The INVEST with RULES Trend Model triggered a shiny new BUY alert for Gold (GLD) this past Thursday (Inner Circle Members found out that day). It maintains a HOLD signal for U.S. Stocks (SPY) and International Stocks (VEU) and it remains a SELL on U.S. Bonds (TLT). 

Be ready because when the trend changes you will read it here first in Weekly Market Trends!

Most Popular: March 2021:

Want to Get Away?

Want to Get Away?
2020 was one of the worst years for air travel demand. The U.S. Department of Transportation reported that U.S. airlines lost more than $35 billion dollars.

One year later a travel rebound is not as far away as you may think. 
Here are 3 reasons there might be a tailwind for domestic leisure airline carriers.

The Vaccine Rollout 
As covid counts decline and vaccines are distributed, passengers are ready to travel and they have... 

Stimulus Checks 
Carriers that have business models focused on price-sensitive domestic leisure travel should fare better than international and business travel.

New Planes & New Hires
Spirit Airlines (ticker: SAVE) and United Airlines (ticker: UAL) are buying additional planes from Airbus and Boeing as they prepare for a recovery in travel demand.

Most airlines have begun training new pilots and attendants and they recently renegotiated worker contracts so hopefully there should be peace on the labor front for a while.

How has it performed?
So far in 2021, the US Global Jets ETF (ticker: JETS) is up +25.38% and Spirit Airlines (ticker: SAVE) has climbed +62.49%, while U.S. stocks represented by the S&P 500 (SPY) is up +4.17%.
Trend Update 
The INVEST with RULES Trend Model maintains a HOLD signal for U.S. Stocks (SPY) and International Stocks (VEU), and it remains a SELL on U.S. Bonds (TLT) and Gold (GLD). 

Be ready because when the trend changes you will read it here first in Weekly Market Trends!

Most Popular: February 2021:

Follow the Flows

Follow the Flows
Exchange traded funds (ETFs) must report the amount of money flowing in or out on a monthly basis, which provides valuable insights.
Bloomberg and State Street track over $5 trillion dollars worth of ETF flows and they reported that billions poured into the financial and energy sectors.  

The financial sector took in $5.8 billion in January. 
U.S. Banks have spent the last decade repairing and rebuilding their balance sheets after the 2008 Global financial crisis. This has allowed them to be well-positioned to manage the stress of Covid-19. 
 
Many analysts believe government stimulus and loan forbearances will put banks in a position to reward shareholders with increasing stock dividends and buybacks.  

The energy sector saw $1.3 billion in flows in January.
The big reason that the energy sector is getting more attention is because it is transitioning to cleaner and cheaper renewable energy sources. 

Also, in recent years the energy sector has decreased spending which presents a compelling combination of cheap valuations and high free cash flow yields (the amount of cash a business has left over after expenses). 

How has following the flows performed?
So far in 2021, the Financial Sector SPDR ETF (XLF) is up 6.92% and the Energy Sector SPDR ETF (XLE) has jumped 17.86%, while the S&P 500 (SPY) is up 5.02%.
Trend Update 
The INVEST with RULES Trend Model maintains a HOLD signal for U.S. Stocks (SPY) and International Stocks (VEU), and it remains a SELL on U.S. Bonds (TLT) and Gold (GLD). 

Be ready because when the trend changes you will read it here first in Weekly Market Trends!

Most Popular: January 2021:

The Future of Your Local Mall

The Future of Your Local Mall 
Shopping malls are in big trouble. One third of malls will shut down in 2021. For years local malls have been losing ground to online shopping, but the coronavirus accelerated their problems. 

So how can your local mall compete against Amazon?

Malls need to transform and the winners might do so in the following three ways. 
1. Social Experiences
Malls that will survive and thrive will provide local experiences for you, your friends, and your entire family whether that be bowling, video gaming, amusement parks, or go karting, all with dining options. 

A great example of this is American Dream, a 3,000,000 sq ft retail and entertainment complex in New Jersey. It offers the largest indoor theme park in the northern hemisphere, the first and only indoor real-snow ski resort, an indoor water park, ice skating rink, mini golf course, high end shopping, restaurants, and more.  

2. Faster & More Personalized 
The future of retail stores will need to offer same day curbside pick up. Also if customers have questions, they need to mimic the knowledge and efficiency you get when you visit an Apple Store.

3. Living & Shopping in One 
Japan calls it a ‘Life Stage Center’ where their aging demographic is offered senior living options and right outside their door they can walk to exercise facilities, medical services, pharmacies, and attorney offices offering estate planning. Unfortunately the cemetery is on the other side of town...

Mallrat: (noun: a young person who frequents shopping malls.)

If mall real estate investment trusts and brick-and-mortar retail companies pull it off, they could make a comeback in 2021. 

High end shopping real estate investment trust Simon Property Group (SPG) is up 1.42% year to date and the Solactive-ProShares Brick and Mortar Retail Store Index is up 6.43% YTD. 
Trend Update 
The INVEST with RULES Trend Model maintains a HOLD signal for U.S. Stocks (SPY), International Stocks (VEU), and Gold (GLD), and it remains a SELL on U.S. Bonds (TLT). When the trend changes you will read it here first in Weekly Market Trends!

Most Popular: December 2020:

Bitcoin, Fees, & FOMO

Bitcoin, Fees, & FOMO
2020 has been difficult for almost everyone and everything, but not for Bitcoin, up +166% year to date. 

The last time I mentioned Bitcoin on Weekly Market Trends was back on July 27th and it's up +93% since then. I have been waiting for a pull back to share this story...but the pull backs have been short and shallow, so here it is. 

What is Bitcoin?
Bitcoin is a digital currency that operates outside of any government or bank. The transactions are saved on a record keeping technology called a blockchain. 

Launched in early 2009, Bitcoin is now the largest cryptocurrency valued at $354 Billion dollars. 
Why is Bitcoin up so much?
1. Inflation
The global war against the coronavirus has now accumulated a debt burden of over $272 trillion. Excessive government borrowing and spending can lead to inflation. 

2. Supply & Demand 
Bitcoin has a fixed supply of only 21,000,000 coins and an additional 900 bitcoin created everyday. The demand is growing fast as 32 million investors own a fraction of bitcoin, up from 21 million just one year ago.

Fees
The incredible Bitcoin returns overshadow their high transaction fees. These fees haven’t been seen since the “The Wolf of Wall Street.” 

Today a buy-and-sell order of Bitcoin can incur fees as high as 6%...not to mention a hidden fee called the “spread.”  
FOMO - Fear of missing out on Bitcoin
For the most part Wall Street has not participated in Bitcoin. What’s interesting is that Bitcoin may still be undervalued because big institutions and their millions of clients haven’t jumped in yet.

Fidelity Investments announced last month that they will soon serve retail clients with Bitcoin trading. If Fidelity is coming, then I would assume Schwab/TD Ameritrade will be next. If the discount brokerage firms come, then Walls Street’s big banks will want in too and that could send the price a lot higher. 
Trend Update 
  • The February Stock of the Month Slack Technologies (ticker WORK) was purchased by Salesforce.com Inc. (ticker CRM) for $27 billion dollars. That delivered us a gain of 111% in just 10 months. Whoop! Whoop!
  • ​November Private payrolls (non-government new jobs) came in below estimates. The silver lining was that hospitality led the way in job creation, adding 95,000 positions in bars and restaurants.
  • ​Lawmakers are leaning towards a compromise on a coronavirus relief package before the holidays
The INVEST with RULES Trend Model maintains a profitable HOLD signal for U.S. Stocks (SPY) and International Stocks (VEU) and a SELL on Gold (GLD).  

U.S. Bonds (TLT) switched to a SELL last Monday. The hardest part of any trend system is something called a "head fake," meaning it flashed a buy and then quickly turned back to a sell. It is a rare event but it happens. When the trend changes you will read it here first in Weekly Market Trends!

Most Popular: November 2020:

If You Believe, We Put a Man (& 4G) on the Moon

If You Believe, We Put a Man (& 4G) on the Moon
SpaceX launched astronauts to orbit
Last week Elon Musk's SpaceX successfully launched four astronauts to the International Space Station.

NASA is launching 4G on the moon
Last month NASA awarded Nokia of America $14 million to deploy a cellular network on the moon. Nokia's plan is to build a 4G network which will eventually transition to 5G. It will be the first 4G communications system in space.

All of this space exploration supports NASA's goal of having a lunar base on the moon by 2028.
How has this trend performed?
Although you can’t easily invest in Elon Musk’s SpaceX or Jeff Bezo’s Blue Origin because both are private companies, there are publicly traded companies in space exploration. 

The Procure Space ETF (ticker: UFO), a basket of space-related stocks, has returned a measly -8% year to date, while Richard Branson’s Virgin Galactic Holdings (ticker: SPCE) rocketed up 108%. 
Trend Update 
Stocks juggled the horrible short term news of the raging virus, while it processed the great long term news of two effective vaccines.
Applications for first-time unemployment benefits rose as pandemic shutdowns increased. Roughly 20 million Americans receive some form of unemployment benefits and about half will lose those benefits when two federal programs expire at the end of the year.

The INVEST with RULES Trend Model maintains a HOLD signal for U.S. Stocks (SPY) and International Stocks (VEU), while it remains a SELL signal for U.S Bonds (TLT) and Gold (GLD). When the trend changes you will read it here first in Weekly Market Trends!
  • Stocks juggled the horrible short term news of the raging virus, while it processed the great long term news of two effective vaccines.
  • ​Applications for first-time unemployment benefits rose as pandemic shutdowns increased. Roughly 20 million Americans receive some form of unemployment benefits and about half will lose those benefits when two federal programs expire at the end of the year.
The INVEST with RULES Trend Model maintains a HOLD signal for U.S. Stocks (SPY), International Stocks (VEU), and Gold (GLD), while it remains a SELL signal for U.S Bonds (TLT). When the trend changes you will read it here first in Weekly Market Trends!

Most Popular: October 2020:

Most Popular: October 2020

Dating During a Pandemic

Dating During a Pandemic
Single & Ready to Mingle
Match Group's CEO Hesam Hosseini said the first phase of Covid-19 dating was: "What's going on? Should I be dating? Do other people want to date?" 

"It's evolved now to, okay, we've figured out how to get to know each other virtually. How do I actually form a connection with someone who is wearing a mask and staying distanced?" 

Match has seen historic highs during the pandemic as even more singles have matched in July than during its typical 'peak season' around Valentine's Day.
...Kiss or no kiss?
From a video date...to an outdoor date...to intimacy, some singles are more direct asking for proof of Covid-19 or antibody test results or suggesting both parties get tested. 

Dr. Abraar Karan of Harvard Medical School said, "Nothing can guarantee you are fully safe...I think we should not downplay the importance of human connection because relationships are what help us stay mentally sane through something like this." 

How Has This Trend Performed?
Match Group, Inc. is the biggest publicly traded company in the online dating space and they own and operate Match, Tinder, OkCupid, Hinge, PlentyOfFish, OurTime, and others. 

In 2020, MTCH has a return of 36.66%, while the S&P 500 is only up 7.90%. 
Trend Update 
- Jobless claims rose 898,000 last week, showing that the labor market remains weak as Covid-19 cases continue to rise. 

-Treasury Secretary Steve Mnuchin said finalizing a stimulus package before the election “would be difficult.” 

- The IMF's Chief Economist, Gita Gopinath said, “We are projecting a somewhat less severe though still deep recession in 2020, relative to our June forecast.” She added, "The revision was driven by better-than-expected growth in advanced economies and China during the second quarter of the year and signs of a more rapid recovery in the third quarter."

The INVEST with RULES Trend Model maintains a HOLD signal for U.S. Stocks (SPY) and International Stocks (VEU), while it remains a SELL signal for U.S Bonds (TLT) and Gold (GLD). When the trend changes you will read it here first in Weekly Market Trends!

Most Popular: September 2020:

The Secret Island Where Value Investors Go

The Secret Island Where Value Investors Go
With the U.S. markets near time highs, where does legendary billionaire investor Warren Buffett find value today?
In Q2 2020, Buffett went overseas to the island of Japan where Berkshire Hathaway (BRKB) bought roughly $6.25 billion in five of the leading Japanese companies. He acquired more than a 5% stake in shares of Itochu Corp, Marubeni Corp, Mitsubishi Corp, Mitsui & Co, and Sumitomo Corp.
The move to invest in Japan is not a quick trade. Berkshire said it intends to hold the investments for the long term and that it may increase its holdings over time. 
Why Japan?
1. Cheap Stocks in a cheap stock market 
Earlier this year Fidelity mutual fund manager, Joel Tillinghast said: “Japan has six times as many cheap, small companies, judged by their price-earnings ratios, as the United States does. But nobody is paying attention because Japan’s Nikkei stock index is still a third below its peak in 1990.” 

In 2020, Japanese holdings account for about 10 percent of Tillinghast's Fidelity Low Priced Stock Fund.  

2. Preparing for future inflation
“The inflation cocktail is being mixed and Buffett is migrating his investment to where you can create value through inflation,” said Bill Smead, of Smead Capital Management, which invests nearly 3% of its assets in Berkshire. 

Beyond Japanese stocks, Berkshire also bought $5.1 billion of their own stock (BRKB) as well as inflation fighting commodity names like Dominion Energy (D), Suncor (SU), Barrick Gold (GOLD), Kroger (KR), and real estate trust Store Capital (STOR).
Trend Update 
The global stock market experienced a sharp pull back this past Thursday where the hardest hit area was technology stocks down -4%. Stocks fell again on Friday morning but it rallied back up from the low of the day, which was a good sign to end a difficult week. 

Even though there was some profit taking this past week, the INVEST with RULES Trend Model continues to have a HOLD signal for U.S. Stocks, International Stocks, and Gold going into the long Labor Day weekend. 

U.S. Bonds (TLT) are still on a SELL signal even though it went up +1.01%, as it was the week's flight to safety trade.  

As of this week the U.S. Stock, Foreign Stock, and Gold remain in an uptrend while U.S. Bonds are in a downtrend. When that changes you will read it here first in Weekly Market Trends. Let's jump in!

Most Popular: August 2020

Short Shorts & Banana Splits

Short Shorts & Banana Splits
The S&P 500 (SPY) closed at a record high last week, ending the shortest bear market in U.S. history. 
One of the hottest stocks this year, which may soon be added to the S&P 500, is Tesla (TSLA). Back on July 5th Elon Musk made headlines as he tweeted: “Limited edition short shorts now available.” Tesla's website offered bright red satin shorts for sale as a publicity stunt. Musk wanted those who dared to bet against Tesla to be comfortable as they saw red losses mount in their accounts. Since that tweet, Tesla shares have climbed another 60%, now up an incredible 390% year to date. 

As Tesla’s stock price has rocketed to over $2,000 per share, they announced a five-for-one-stock split. Apple (AAPL), trading around $500 per share, also announced a four-for-one-stock split this month. 

Why do stocks split? Is it good or bad?
When I was a financial advisor for over 16 years, I would talk with clients about exciting stocks and the first question they would ask me was: “What is that stock trading at?” 
If the stock's price was high, they would have a negative reaction. They would feel like they missed out. Have you ever felt that way too? 
So why do stocks split? 

1. It gives the illusion that the stock is cheap. 
If you owned Tesla before the record date you will soon own five shares for every one you hold, and the stock price will be reduced to one-fifth of its value. So in reality nothing has changed, but on the day after Tesla and Apple’s announcement, their stock prices rose 13% and 10%.  

2. It lets more traders get in. 
Tesla and Apple realize that retail investors are flocking to the stock market because brokerage firms have cut their fees and trading apps like Robinhood make it easier to get in the market.

3. History says it’s good.
One of the most prominent studies on stock splits was written by David Ikenberry, a finance professor at the University of Colorado. He found that the average stock undergoing a two-for-one stock split beat the market by 7.9% over the next year and by 12.2% over the next three years after the split announcement.
Trend Update 
The INVEST with RULES Trend Model has been highly profitable for months on a HOLD signal for U.S. Stocks, International Stocks, and Gold. 

In the last email I sent, U.S. Bonds (TLT) flashed a SELL signal because the trend turned negative. It is still on a SELL signal. There will be times when right after a sell signal an investment will try to rebound and that is what happened this past week. It's important to note that the buying of U.S Bonds was on light volume with low conviction, showing evidence there may be more selling coming in the following weeks. 

As of this week the U.S. Stock, Foreign Stock, and Gold markets remain in an uptrend while U.S. Bonds are in a downtrend. When that changes you will read it here first in Weekly Market Trends. Let's jump in. 
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Jeremy Jackson
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