Capitalogix

Interesting Links for Your Weekend Reading

Don't get into a fight you can't win.

 

Here are some of the posts that caught my eye. Hope you find something interesting.

Lighter Links:

• 8 Dangers of Collaboration. (Yes & Know)
• Brad Feld’s New List of Books for Entrepreneurship. (Feld)
• A List of the Articles Most-Shared on Facebook in 2011. (Facebook)
• Bionic Contact Lens 'To Project Emails Before Eyes'. Just what you need. (BBC)
• A New Trend? Tech Firm Outlaws Email Because It Wastes Too Much Time. (Newser)

Trading Links:

• Goldman’s Top Investing Picks for 2012. (FinancialPost) 
• Stock & Pony Show: The Toothless Ban On Congressional Insider Trading. (TheDaily) 
• Can Facebook Raise $10 Billion at a $100 Billion Valuation in Its IPO? (WSJ)
• CEO Outlook: 15 Predictions about 2012. (Chief Executive Magazine)
• Speculation or Trepidation? Fear is More Powerful than Greed. (Economist)

Diversification Ideas for this Market

David Stendahl sent me some stats that point to some diversification opportunities. 

Does the following chart look like a bunch of scribbles?  Good; it shows the diversified returns of the S&P 500 Index, Gold, Euro, 10-Year Note, Corn and Crude.

 

 

Keep these markets in mind as trading options that often offer performance not highly correlated with the S&P 500 Index.

What follows are a similar set of comments for various markets.

 

Gold

Over the past 14 yrs, the top 20 winning mos. in Gold produced an avg return of 8.3% … The same mos for the S&P 500 returned 0.6%.

Since 1997 Gold generated a total return of 165.3% based on its top 20 grossing mos. … The S&P 500 index returned 12.5% for the same mos.

Gold generated an avg return of 8.3%/mo based on its top 20 grossing mos. since 1997 … Returns the next month were up on avg 1.3%.

FYI: Gold generated an avg return of 0.6%/mo based on its top 20 grossing mos. since 1997 … Returns the next month were up on avg 1.3%.

14 year perspective … top 3 monthly returns for Gold 13.4%, 13.2% & 12.3% vs. those for the S&P 500 index 11%, 10.1% & 9.3%.

The short advantage ... top 3 negative monthly returns for Gold -17.9%, -11.4% & -9.2% vs. those for the S&P 500 index -18.1%, -12.2% & -11.5%.

 

Crude Oil

Over the past 14 yrs, the top 20 winning mos. in Crude Oil produced an avg return of 9% … The same mos for the S&P 500 returned 1.8%.

Since 1997 Crude Oil generated a total return of 179.2% based on its top 20 grossing mos. … The S&P 500 index returned 35.3% for the same mos.

Crude Oil generated an avg return of 9%/mo based on its top 20 grossing mos. since 1997 … Returns the next month were up on avg 1.6%.

FYI: Crude Oil generated an avg return of 1.8%/mo based on its top 20 grossing mos. since 1997 … Returns the next month were up on avg 1.6%.

14 year perspective … top 3 monthly returns for Crude Oil 19.2%, 17.3% & 11.6% vs. those for the S&P 500 index 11%, 10.1% & 9.3%.

The short advantage ... top 3 negative monthly returns for Crude Oil -23.3%, -15.1% & -13.6% vs. those for the S&P 500 index -18.1%, -12.2% & -11.5%.

 

Corn

Over the past 14 yrs, the top 20 winning mos. in Corn produced an avg return of 10.7% … the same mos for the S&P 500 returned 1.9%.

Since 1997 Corn generated a total return of 214.7% based on its top 20 grossing mos. … the S&P 500 index returned 37.7% for the same mos.

 

Euro

Over the past 14 yrs, the top 20 winning mos. in Euro produced an avg return of 5.5% … The same mos for the S&P 500 returned 2.4%.

Since 1997 Euro generated a total return of 109.2% based on its top 20 grossing mos. … The S&P 500 index returned 49% for the same mos.

 

Ten Year

Over the past 14 yrs, the top 20 winning mos. in 10 Yr. T-Note produced an avg return of 2.1% … The same mos for the S&P 500 returned -1.5%.

Since 1997 10 Yr. T-Note generated a total return of 42.3% based on its top 20 grossing mos. … The S&P 500 index returned -29.8% for the same mos.

10 Yr. T-Note generated an avg return of 2.1%/mo based on its top 20 grossing mos. since 1997 … Returns the next month were up on avg 0.1%.

FYI: 10 Yr. T-Note generated an avg return of -1.5%/mo based on its top 20 grossing mos. Since 1997 … returns the next month were up on avg 0.1%.

14 year perspective … top 3 monthly returns for 10 Yr. T-Note 5%, 2.7% & 2.4% vs. those for the S&P 500 index 11%, 10.1% & 9.3%.

The short advantage ... top 3 negative monthly returns for 10 Yr. T-Note -3.7%, -2.6% & -2.5% vs. those for the S&P 500 index -18.1%, -12.2% & -11.5%.

 

The Perfect Holiday Gift - A Yacht Built Like a Tropical Island

I know what I want for the holidays ... an amazing island built right on a beautiful yacht. 

 

 HT KD

This was created by UK-based Yacht Island Designs. 

As you can see, the design is inspired by tropical islands, with huts, a pool ... and to top that ... a volcano guaranteed not to erupt.

 

Since it's a yacht, it comes packed with VIP rooms, arcades, gym, lounges, spas and even a helipad. What a great place to do business? 

The back of the yacht has a retractable beach deck and dock.  Why go to the trouble of getting out to sea if you can't wake-board, jet-ski, or swim; right?

 

 

If you want to know how much it would cost to fuel-it-up or operate, it's probably not in your price range.

Hope you are having a happy holiday season.

Are You Expecting a Santa Claus Rally or a Dumb-Money Mugging?

That was quite a move in the markets last week.  Was it 'real', or wishful thinking?

Kind of like the jobs number?  Does it show an improving economy (with some seasonal hiring), or was the jobs number smoke, mirrors, tomfoolery and skulduggery?

Back to the market, a quick look at a daily chart of the S&P 500 Index shows that the recent rally stalled the resistance. Price is still below the 200 day moving average, and it closed below the recent downtrend line. An impressive rally, to be sure ... However, it was the lack of volume on the big push higher that caught my attention.

 

 
When a market makes a 7% move (especially without a volume spike), traders are going to notice.

So, while some pros looked to take profits into the push higher - it looks like something finally caught the eye of retail traders.

While not statistacally significant, these examples  seemed worth sharing.

While I was getting a haircut this week, I listened as my barber debated the merits of buying Netflix with the barber standing next to him. Likewise, a trainer at the gym wanted to talk about several stock ideas he's considering buying.  Meanwhile, several people called to talk about whether to buy American Airlines while it was priced less than a happy meal toy.

We can talk about "smart-money" versus "dumb-money"; but until this, I hadn't seen recent interest in the markets from normal investors.

Perhaps something is stirring the 'animals spirits'.

Without selling pressure, it doesn't take much to push markets higher.  So, are you expecting a Santa Claus Rally or a Dumb-Money Mugging?

Time will tell.
 

Related articles

• AMR Files for Bankruptcy (crossingwallstreet.com)
• How Quickly the Mighty Can Fall: Netflix (NFLX) (bespokeinvest.com)

Some Interesting Links for Your Weekend Reading

Government popularity has taken a hit lately.

 

 

Here are some of the posts that caught my eye. Hope you find something interesting.

Lighter Links:

• Why Peter Drucker Distrusted Facts. (Harvard Business Review)
• 9 Metrics to Help You Make Wise Decisions About Your Company. (KM)
• Steve Jobs Told Team Not to Ask "What Would Steve Do?" (AppleInsider)
• What Will Happen When the Average Lifespan Tops 100? (BigThink)
• The Rise of The Megacity. Jakarta, Lagos, and Sao Paolo are changing the way we think about cities. (Slate)

Trading Links:

• A Behind the Scenes Look at MF Global's Last Days. (SeattleTimes)
• Here Are the World's 29 'Too Big to Fail' Banks. (TheAtlantic)
• Paying for Safety: Older Investors Voting With Their Wallets. (WSJ)
• We Had a Good Week; But Wall Street Had Its Worst Quarter Since the Crisis. (Bloomberg)
• Obama to China: Behave Like a 'Grown Up' Economy. (CNBC)

 

See How the Dalai Lama Responds to a Dalai Lama Joke

Here is a video that shows how an Australian Australian presenter failed to amuse the Dalai Lama with a Dalai Lama joke.

 

 

 

The play-on-words "joke" he used is: the Dalai Lama walks into a pizza store and asks if they can make him one with everything. 

The Dalai Lama's response is funnier than the joke.

He could have added: The Dalai Lama then gave the cashier $20 and asked for his change.

The cashier replied: Change comes from within.