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Volatility | July 20, 2017

Posted on July 20, 2017

Short- and long-term volatility are converging, another indicator that this is a market in a state of confusion. Despite rising volatility, it is still well below historical averages. We think this still provides a good environment for risk assets to perform well. The old Wall Street adage, “Stocks climb a wall of worry”, seems quite appropriate here. […]

Momentum | July 18, 2017

Posted on July 18, 2017

Our Observations: Nearly every asset class is close to 0 in near-term returns, indicating that the market continues to be in a state of confusion. A strong push in emerging markets helped reverse the course of near-term momentum. When combined with strong long-term momentum, emerging markets appear to maintain their position as leaders among stocks. Momentum […]

Volatility | July 13, 2017

Posted on July 13, 2017

Our Observations: Short-term and near-term volatility are nearly at parity in every asset class. We think we may be entering a period that is usually weak for stocks, where the increase in volatility might simply be an acknowledgement of that case. However, as of right now we still see there is very little evidence supporting the […]

Correlation | July 12, 2017

Posted on July 12, 2017

Our Observations: Correlations are very low in nearly every asset class. This is a little bit surprising given the volatility of the bond market, which should be signaling other parts of the market, but that doesn’t appear to be the case. However, we think it would be smart to keep an eye out for correlations […]

Volatility | July 7, 2017

Posted on July 7, 2017

Long- and short-term volatility are converging as the markets continue to grind sideways. The most notable movement this week is the sharp reversal in agriculture commodities from the drought. Agriculture commodities are some of the few assets seeing short-term volatility surpass long-term volatility. Market volatility is an indicator of financial stress. Low or declining volatility […]

Volatility | June 29, 2017

Posted on June 29, 2017

Our Observations: Short-term volatility is nearing long-term volatility, which is consistent to a sideways market. We think it is important to keep an eye on shifts in volatility which could coincide with a shift in momentum and help affirm market direction. Market volatility is an indicator of financial stress. Low or declining volatility environments may […]

Volatility | June 22, 2017

Posted on June 22, 2017

Volatility among tech companies has exceeded its long levels, following a period of stress on that segment of the market. These types of steep increases in risk aren’t unusual for tech bull markets since the market is expecting extremely elevated levels of growth to justify valuations. However, this is typically a bad sign for near-term […]

Volatility | June 15, 2017

Posted on June 15, 2017

Our Observations: Current volatility is approaching the long-term volatility numbers, based on a combination of slightly higher near-term risks and a long period of overall low levels of risk. This is notable as it could indicate a potential for a correction. However, the current level of risk is still far from historical averages and this […]