Few investors are good at swing trading — meaning, they're not good at predicting short-term swings in the market.
Recently, BusinessInsider observed that more often than not, investors find themselves buying high and selling low. And when the market starts selling off sharply, investors will panic, sell their own shares, and sit on the sidelines.
The Economist's Big Mac index seeks to make exchange-rate theory more digestible. They say, tongue-in-cheek, that it is arguably the world's most accurate financial indicator to be based on a fast-food item.
According to this measure, the most undervalued currency is India's Rupee at about 67% below its PPP rate. In India, a McDonald’s Big Mac costs just 95 Rupees on average, the equivalent of $1.54 at market exchange rates. In America, the same burger averages $4.62.
The interactive graphic, below, shows by how much, in Big Mac PPP terms, selected currencies were over- or undervalued.
The index is supposed to give a guide to the direction in which currencies should, in theory, head in the long run. It is only a rough guide, because its price reflects non-tradable elements such as rent and labor. For that reason, it is probably least rough when comparing countries at roughly the same stage of development. The Economist has added an adjustment option to account for this in the interactive version of the data.
The number of households with net worth of $1 million or more, excluding their homes, is at a record 9.63 million, according to a new report.
That eclipses the old mark of 9.2 million in 2007 before the global financial crisis, according to Spectrem Group research. The tally of millionaires slipped to 6.7 million in 2008 as the financial crisis struck.
This study reinforces other data showing that the wealthy in the U.S. are doing well.
Were you surprised how quickly Markets digested the risk of Russia and the Ukraine?
It's not the news ... it's what markets do after the news hits. In Bear Markets, markets are looking for excuses to pull-back and take risk off the table. In Bull Markets, things can advance, even with uncertainty.
The New York Stock Exchange publishes end-of-month data for margin debt. Historically, surging peaks of margin debt often happen before big market pull-backs.
The chart, below, shows the relationship between margin debt and the market (using the S&P 500 as the proxy for the market). Even adjusted for inflation, the latest data puts margin debt as at an all-time high.