Category Archives: Investment

3 Likely Triggers Of The Next Recession

Posted on by

by Lance Roberts

 
1. Export Shock

With the Eurozone slipping into recession, combined with the economic contraction in China, the most likely event will be an export related slowdown for the U.S.

2. Liquidity Crisis

Secondly, a resurgence of the Eurozone crisis that leads to a “liquidity shock” would likely stall the economy.

While the ECB has currently committed funds to provide liquidity to the Eurozone the problem of a single large potential default issue from either Italy or Spain, or even a combination of events through the entire region, could quickly create a liquidity crisis.

“Black Swan” Event

When considering the many possibilities that could occur from the information that we have readily available we must not discount the possibility of an event that is completely off the radar.

It is these seemingly random events that occur without warning such as the Japanese earthquake in 2011, the “Asian Contagion”, Long Term Capital Management or 9/11 that can push the economy off the ledge and into the cold waters of recession.

3. The “Fiscal Cliff”

The impending “fiscal cliff” coming at the end of 2012 where a plethora of tax cuts, credits and incentives, many left over from the Bush era and extended by the Obama administration, will collectively expire.

This is no small matter. The simultaneous expirations of these tax benefits will create approximately a 2% hit to GDP which, given the associated fallout across the economy, will be more than sufficient to create a recession.

http://www.zerohedge.com/news/3-likely-triggers-next-recession

For similar articles and discussions, please do visit the forum:-

http://investideas.net/forum/viewtopic.php?f=16&t=3036&start=100

Winston’s Investment Blog: TOL as of April 29, 2012

Posted on by

TOL as of April 29, 2012:-

Better To Stay Long ?

Image

It looks like the Bulls are winning.

And “buying on dips” was the way to go.

However, that applies to US Equities only, as the other markets are weaker.

So do you really know why you are buying or selling ?

The week in review:-

Commodities

1. Oil – Stronger. US$105 from US$103 last week from US$103 the previous week. Resistance at US$107 ?

2. Gold – Stronger. US$1663 from US$1643 last week from US$1658 the previous week. Record US$1920. Vested.

3. Silver – Flat. US$31.25 from US$31.66 last week from US$31.49 the previous week. Range High: $48.58; Range Low: US$27.19; Resistance at US$38 ? Vested.

Equities

1. US Equities – Stronger. 1403 from 1379 last week from 1370 the previous week. Support at 1343 ? Resistance at 1420 ?

2. HK Equities – Weaker. 20742 from 21011 last week from 20701 the previous week. Resistance at 21050 then 21350 ? Support at 20150 ? Added to Zhaojin Mining.

3. Shanghai Equities – Weaker. 2396 from 2407 last week from 2359 the previous week. Support at 2285 ? Resistance at 2410 then 2460 ? Vested A50 China ETF

4. Spore Equities – Weaker. 2982 from 2995 last week from 2988 the previous week. No trade

5. Japan Equities – Weaker. 9521 from 9561 last week from 9638 the previous week. Support at 9575 taken out. Next support at 9465 ? Resistance at 10130 ?

Currencies

1. JPY – Stronger. 80.29 from 81.52 last week from 80.93 the previous week. The 52 week range is 75.62 to 84.17.

2. MYR to SGD – Weaker. 2.4586 from 2.4547 last week from 2.4433 the previous week. Upcoming GE a concern.

3. AUD – Stronger. 1.0467 from 1.0379 last week from 1.0378 the previous week. Vested

4. EUR – Stronger. 1.3251 from 1.322 last week from 1.3078 the previous week.

5. HKD – Stronger. 7.7593 from 7.7609 last week from 7.7605 the previous week. 52 week range is 7.7521-7.7972. Vested

6. Dollar Index – Weaker. 78.71 from 79.14 last week from 79.88 the previous week.

Interest Rates

1. Yield on 10 Year Italian Bonds – Flat; 5.64% from 5.66% last week from 5.52% the previous week; Record 7.483%.

2. Yield on 10 Year Spanish Bonds – Lower. 5.88% from 5.96% last week. Line in the sand at 7.5% ?

3. Yield on 10 Year US Treasuries – Lower. 1.94% from 1.96% last week

Risk-On / Risk-Off

1. Emerging Markets – Inflows from Inflows last week from Outflows the previous week; http://www.epfr.com

2. Average Daily Turnover on HKEX – Weaker. HK$46b from HK$51b last week from HK$54b the previous week.

3. Sentiment – Mixed.

4. Hedge Funds – No major redemptions

5. Deleveraging – The IBs have probably bought themselves some time, with all the cheap money slushing around

6. Headwinds – European Contagion, Weak Economies of the DMs, Elevated Commodity Prices, Slower EM growth, Deleveraging, Lower Margins, Weaker Earnings, Falling Property Prices, Tighter Credit Requirements, Downgrades by Rating Agencies, Austerity Programs, Iran

7. Tailwinds – Low Interest Rates, EM Consumption, EM Demographics, Cash on Sideline, Cash in Corporations for M&A, Cash in short-term Bonds, Buybacks, Money-Printing

8. Risk Management – Are your Stops and Trailing Stops in place ?

Others

1. HK Properties – Only 600 new flats were completed in the first three months, a four-year low, prompting warnings of further price rise

2. Short-Selling & Buying Puts – No new positions. It’s a Bull Market.

3. US Market Direction – Stronger

New money from a new month, could propel the market higher.

And Earnings announcements are certainly providing the catalyst, to move things upwards.

Not to mention that Helicopter Ben is always around, to talk the market up.

The Plunge Protection Team could also be working overtime, to ensure that things are stable before the Election.

So maybe one should not be really shorting the market, whenever there’s a Presidential Election.

The above is to help me crystallize my thinking. It’s not a recommendation to Buy or Sell. Use the above comments at your own risk and please do also feel free to provide me with your kind thoughts and comments

Please Note:-

Support the forum button – If you have benefited from the ideas in the forum but have not participated in the discussions, we would appreciate your kind support to defray the expenses of maintaining the forum.

Private Messages ( PM ) – Please do check your Inbox for any PMs. The Inbox is located on the top left hand corner of the Index Page.

Second Opinion – Please see the “Second Opinion” thread in the “Services for InvestIdeas Members” section, located just below the Miscellaneous Section.

Active Topics – Do you know that there’s an “Active Topics” button? It’s located on the top left hand corner of the Index Page.

For similar articles and discussions, please do feel free to visit the forum:-http://investideas.net/forum/index.php

3 Steps to Investment Success

Posted on by

by Kevin Matras

If one of your goals is to become a better trader, then decide to be one.

How does one do that? Just like any decision, it only requires a few simple steps to get the ball rolling.

1) Decide what kind of trader you are or want to be.

Do you prefer upward trending momentum stocks or deeply discounted value stocks? High-flying aggressive growth stocks or more mature income-producing stocks?

There’s no wrong answer.

But this is important because if you find yourself buying stocks that are not in alignment with who you are or want to be as a trader, you’ll find yourself abandoning those stocks the moment they hit a rough patch.

The best style of trade is the one that’s right for you.

2) The next step is to determine what strategies work best for that style of trade.

In other words, what characteristics have proven to work for those types of stocks? The key word being ‘proven’.

For example: some investors incorrectly believe that the best aggressive growth stocks are those with the biggest growth rates. But studies have shown that’s not the case.

In fact, in my testing, I have found that stocks with the absolute highest growth rates oftentimes perform just as poorly as those with the lowest growth rates. How can this be? It’s usually because those growth rates are unsustainable. And the moment those sky-high growth rates, which were priced for perfection, have even the slightest downward revision, the stock price can fall back down to earth as well.

I have found that the best growth rate ranges are those that are above the median for their industry and no higher than 50%. That does not mean stocks with growth rates higher than 50% won’t go up, because they do. And that doesn’t mean that stocks with growth rates in the optimum range won’t go down, because they do too. But sticking with stocks with characteristics that have proven to work more often than not will increase your odds of success.

And each style of trade has a set of characteristics that, if followed, will help you pick more winning stocks than losers.

3) The last step is really the easiest and the most fun. And that’s doing it.

Once you’ve decided what you want and how to go about getting it, then it’s time to do it.

And you’ll find picking winning stocks has never been easier. Because now that you know what you’re looking for, they’ll be easier to find.

Think about the last car you bought. Once you decided on what kind of car you wanted, you probably saw them everywhere. They didn’t just magically appear. They were always there. You just became aware of them.

And it’s the same with stocks. The most profitable stocks that are right for you have always been there. But now you’ll be able to spot them.

And nothing is as exciting as waking up each day and following your proven plan for success.

http://yolotraderalerts.com/?p=4066&utm_source=email_marketing_system&utm_medium=email&utm_content=16125303&utm_campaign=The%20Key%20to%20Investment%20Success

For similar articles and discussions, please do visit the forum:-http://investideas.net/forum/viewtopic.php?f=16&t=3030&start=150