The price of oil has dropped by close to 50% over the last six months to a level we believe is causing serious problems for oil producers. We believe if current conditions persist it will cause credit issues. The U.S has increased production of oil by an additional 4 million barrels a day since 2010….
Read BlogThe market last week was up slightly, but it felt heavy to us. Of the 10 major sectors of the market, 5 were down last week. Healthcare continued to defy gravity, and the banks were up, anticipating some relief with the expectation that interest rates were headed higher. The Employment report was very strong, which…
Read BlogOil has been collapsing, down roughly 40% from this year’s high. The issue is a lack of enough demand growth to offset the increased production from the U.S. Since 2010, the U.S. has increased production of oil from 5 million barrels a day to about 9 million barrels a day currently. The large increase in…
Read BlogContinuing with the theme of slow to negative global growth worldwide, Japan reported on Sunday that their economy has entered into a recession, falling -1.6% in the third quarter following a -7.1% drop in the second quarter. Japan has been aggressively printing money and causing their currency to fall incredibly. Please see the chart below….
Read BlogWe think the valuations of the BDC sector represent a very attractive opportunity. When you compare BDCs to other yield oriented sectors that have high historical correlation, the chart really stands out as an outlier. You can see there is a high degree of correlation between utilities and BDCs up until February of 2014. This…
Read BlogWe would like to reiterate the structure of the portfolio, the risk management techniques we incorporate, and how we are currently positioned. Our portfolio is comprised of high quality dividend paying stocks, with currently some inverse ETF’s to protect the portfolio. Our goal over a full market cycle is to earn on average a 5%…
Read BlogThe market is back to the old highs. The correction that started in the middle of September for the S&P 500 and ended in the middle of October fell almost 10% from intraday high to low, is now back to where it started. The correction actually started much before September as the breadth of the…
Read BlogFrom the market high in September, to the low in October, the S&P 500 has corrected about 10%. The Russell 2000, the small cap index, is down almost 15% from the yearly high to the recent low. Finally, we have a correction. The market has broken some important support levels through the widely regarded 200…
Read BlogThere was definitely some panic in the markets this morning, after having a second 90% down volume during the last 11 trading sessions. The international markets fell again on weak economic data. Germany is now down 20% from its recent high, and is in a bear market. We also had two technology companies preannounce bad…
Read BlogWe have seen a little negative volatility recently in our portfolio, and we wanted to explain why. It is from two factors, the first is the fact the market, or the S&P 500, has been hitting new highs recently, while the average stock in the S&P 500 is down over 7% from its recent high….
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