Japan: Trying to Kindle an Equity Culture

Starting yesterday, Japanese investors can open new tax free accounts that will go live at the start of January.  The new scheme, Nippon Individual Savings Accounts (NISA)  is modeled on the UK’s ISAS program.  It will allow individuals to invest as much as JPY1 million a year for five years with no tax on capital gains […]

Asset Allocation & Rebalancing Review: Can You Say Rebound?

Can you say “rebound”? Mr. Market can. Asset prices have taken a sharp turn higher in September, or at least some of the recently battered markets fall into that category, as today’s comparison with the previous update on August 28 reminds. The general change since then is striking, considering the breadth of negative momentum as last month […]

Is This Time Different? … No!

There is a growing view that investment returns in financial markets are increasingly driven by central bank policy action rather than fundamentals (such as the macroeconomic outlook, business cycles  and corporate earnings) prompting questions to be raised about the very nature of free market investing. We have already seen the impact of government policy play […]

200-Day Versus 10-Month Moving Averages

Tuesday evening’s reads led with a link to Mark Hulbert’s How to know when it’s time to leave the party. Hulbert created a backtest that compared being “fully invested in the Dow whenever it was above its 200-day moving average, and otherwise completely out of the market.” That above or below signal in theory keeps you out of trouble. I […]

The Rich Got $17 Trillion Richer

Despite the many negative headlines, 2012 was a good year for markets. Listed below is a rough snapshot of total returns in USD – most asset classes returned double-digits. 2012 was a year to look through pessimism – how did your PA do? I would estimate that Global Financial Wealth rose by $17,500,000,000,000 to $162 trillion (I ignore […]

The Year of Betting Conservatively

The upswing in global equity markets that started in July is now running out of steam, which comes as no surprise: with no significant improvement in growth prospects in either the advanced or major emerging economies, the rally always seemed to lack legs. If anything, the correction might have come sooner, given disappointing macroeconomic data […]

What’s Going On?

Whenever a significant trend change occurs in equity markets, the immediate response from most quarters is a mix of confusion and often futile attempts to rationalize the occurrence. This is true regardless of whether the trend change is in your portfolio’s favor or against it. A heady mix of wishful thinking and fear get trotted […]