As mentioned in my Q2 Market Review piece, this market has been quiet…too quiet. Historically, the stock market averages 3 pullbacks of 5% per year with one of those going on to become a 10% correction. So when was the last time markets pulled back 5%. Remember the Brexit vote in June 2016? Yep, it’s been over 13 months. Even more impressive is that it’s been almost a year since we’ve seen even a 3% pullback, only the 2nd time since 1950 we’ve gone this long. The first was in 1995. (Source: LPL Research). [Read more…] about Market Drop? It’s About Time!
In a Nutshell
- The Fed raised interest rates another 0.25%
- U.S. and International stocks continued their strong performance
- Stock volatility around the world is at historically low levels
In February of 1992, an Australian syndicate of 2,500 ‘investors’ attempted to win the Virginia Lottery by buying every number combination. The jackpot had grown to $27 million and while that seems like peanuts compared to an ordinary Powerball or Mega Millions jackpot, back then it was the largest potential payout the state had ever seen.
To the Aussies, it seemed like a good risk because the odds of winning were only 1 in 7,000,000. As long as there were less than 4 winning tickets, they’d make a profit and if they wound up with the only winning ticket, they would almost quadruple their money. [Read more…] about Is the Stock Market a Lottery?
In a Nutshell
- U.S. stocks continued their post election rally
- International stocks also had a strong quarter and yet may still be undervalued
- Government and high quality corporate bonds continue to show the effects of the Fed’s rate increases
- Oil and precious metals look to be range bound
- Tulip Bulbs for geeks