Category Archives: Daily Top Ten

TOPLEY’S TOP 10 April 08 2024 

Daily Top Ten No Comments

1. AI Stock SMCI -23% from Highs

Still looks like small blip on longer-term chart.

2. Gold Rally….ETF Assets Still Well Below Highs

3. Gold New Highs but U.S. Dollar Not Weakening

This chart compares Gold ETF GLD to U.S. Dollar…straight up since Feb.

4. A Couple of Popular Consumer Stocks with Gaps Down

ULTA -23% from highs.

5. China has More Chipmaking Capacity than the Rest of World Combined

6. Supply and Demand for Stocks…More Buybacks and Less IPOs=Shrinking Supply

@Callum Thomas (Weekly S&P500 #ChartStorm)
Supply & Demand:  One thing to remember amid all the variables and calculations and prognostications on the stockmarket… is that it is after all, a market. And what does ECON101 tell us about markets? Price is the balancing factor between supply and demand. The chart below shows what’s been happening on the supply side of the equation (in other words: more buybacks and less IPOs/issuance = shrinking supply, shrinking supply ceteris paribus = higher prices).

Source:  @C_Barraud

7. Three Stable Coins Account for 60% of Trading Volume in Crypto

  • The top three stablecoins accounted for more than 60% of trading volume of the five most traded cryptocurrencies on Monday.
  • Stablecoin issuance serves as a measure of new capital entering the market.

Stablecoins accounted for more than half of all daily trading volume among the most traded cryptocurrencies Monday.

Tether, First Digital USD, and USDC each clocked around $58 billion, $7.5 billion and $7.1 billion, respectively, CoinGecko data shows.

Collectively, these three stablecoins made up more than 60% of the trading volume of the five most traded cryptocurrencies that day. Bitcoin reached about $34 billion, while Ethereum saw $20 billion.

Stablecoins “have attracted the most capital, emphasising investors’ inclination towards stability and reliability over other alternatives,” Vincent Chok, CEO of First Digital, told DL News.

Stablecoins are cryptocurrencies with values typically pegged to fiat currencies like the US dollar. They provide an avenue for traders to park their funds during highly volatile periods.

“Stablecoins are an extremely crucial asset for traders both from a stability perspective and a leverage perspective,” Pat Doyle, a blockchain researcher at Amberdata, told DL News.

https://www.dlnews.com/articles/markets/stablecoins-win-60-of-crypto-volume-thanks-to-reliability/

8. Unmanned Land Drones in Ukraine War

https://ukdefencejournal.org.uk/ukraine-tests-ground-combat-drone-ironclad-on-front-lines/

9. Wireless Brain Computer

WSJ By Joe Craven McGinty

https://www.wsj.com/story/mind-reading-brain-implant-gets-a-test-run-in-the-operating-room-e50c4a49

10. Life is Unpredictable

The Daily Stoic

In March 2020, uncertainty gripped the world as the COVID-19 pandemic spread rapidly. The markets were crashing. Businesses were shutting down. Schools and universities closed their doors. Strict lockdown measures confided millions to their homes.
Brent Underwood, a co-founder here at Daily Stoic and whose inspiring journey​we’ve been sharing​over the past month, thought he’d found the perfect place to ride out the pandemic—a small California ghost town called Cerro Gordo he’d been slowly renovating and turning into a resort.
It was safe and isolated, beautiful and quiet…for a second. Then a freak series of snow storms trapped him there in Cerro Gordo for weeks with dwindling supplies and no running water. His retreat turned suddenly into a prison. Then he had a bout with appendicitis that required him to drive himself 2 hours to the closest clinic.
As we’ve said before, life comes at you fast.
And once they start coming, they don’t stop coming. The rest of the snow melted. Work progressed on the town. Media attention poured in. The New York Times profiled him and the town in a long-awaited piece. And then, before he even had time to send the article to his family, the town’s crown jewel—the American Hotel—burned to the ground…exactly 149 years to the day from the day it had opened. From triumph to disaster in a matter of hours.
Seneca himself tells the story of Rome burning to the ground and how the city of Lyons came to her aid with a large donation. Little did Lyons know that within a year Rome would be returning the favor because Lyons had burned.
Life is unpredictable…yet somehow very predictable. Life comes at us fast. It doesn’t stop. It puffs us up and brings us low. It blesses and curses us. All we can do is be ready. All we can do is pick up the pieces and keep going.

https://dailystoic.com/life-is-predictably-unpredictable/

TOPLEY’S TOP 10 April 05 2024

Daily Top Ten No Comments

1.Equities Shine Over Bonds-Bespoke

Helped mainly by the massive gain since late October, the S&P 500’s one-year trailing total return through the end of March clocked in at an eye-watering 30.5%, or nearly triple the historical average of 11.8%.  While the rally over the last year has been well above average, it followed a period of weak returns in the prior year.  When you combine the last two years, the S&P 500’s annualized gain of 9.7% is nearly a full percentage point below the long-term historical average.  Looking out over the last five and ten years, annualized returns have been well above average, but over the prior twenty years, the S&P 500’s performance has been sub-par.

Equity market returns may have been below average over the last two and twenty years, but you won’t find many equity investors looking to trade shoes with investors hiding out in long-term (LT) US Treasuries.  The chart below shows the annualized total return of the Bank of America/Merrill Lynch index of 10+ Year US Treasuries over various timeframes.  Over the last year, LT Treasuries declined 4.8% versus a long-term average annualized gain of 8.1%. If you think that’s bad, check out the two-year annualized decline of 13.1%…in Treasuries!  That’s a 25% haircut!  Even over the last five years, LT Treasury returns have been negative to the tune of 1.6% annualized. To find – not better than average – but simply positive returns, you have to go out to the ten-year window, where the total return is just 1.6% annualized and still seven percentage points less than the historical average.  While technically not a lost decade, it’s been a loser of a decade for sure.

2.Best and Worst ETFs Q1

Nasdaq Dorsey Wright

3.Buybacks Huge Part of Demand for Stocks.

The Daily Shot Brief Equities: Goldman sees share buybacks driving demand for stocks this year.

Source: Goldman Sachs; @WallStJesus

4.FANG+ Stocks Held Above 50day Since Nov 1 2023

5.$21 Trillion in T-Bill Issuance Past 12 Months-B of A Research

6.S&P Metals and Mining ETF Closing in on 2022 Highs.

7.Growth vs. Value

Barrons Active funds now have 56% less exposure to value investments than to momentum factors—a 15-year low, according to Subramanian. “Funds looking for cheap stocks based on low price-earnings valuations is at a “max underweight,” she adds. “A brain drain and asset drain, with 40% fewer funds, from active fundamental to passive and private suggest markets may be less efficient and offer more alpha potential.”

Value has had its share of false starts. But Subramanian writes that value is historically cheap at a time investors could become more attuned to the price they are paying for stocks.

Over the last decade, roughly 150 active large value funds have gone extinct, Morningstar’s Director of Manager Research Russel Kinnel said via email. That could mean a bigger opportunity for those stockpickers who stuck with value if this turnaround materializes.

Write to Reshma Kapadia  https://www.barrons.com/articles/value-stocks-bank-of-america-financials-etfs-dfa41ba4?mod=hp_LEAD_1_B_3

Russell 1000 Value cheaper than Growth but IWD broke out of 5-year holding pattern

www.stockcharts.com

8.55% of Americans Don’t Have CC Debt.

Ben Carlson According to the Fed, 45% of American households have credit card debt. That number has been relatively stable over time:

https://awealthofcommonsense.com/author/sodoi7/

9.Old School Heist $30m

Tens of millions stolen from money storage facility in one of the largest cash heists in Southern California

ANDREW BLANKSTEIN AND MINYVONNE BURKE

Thieves stole tens of millions of dollars from a money storage facility in what is being called one of the largest cash heists in Southern California.

The robbery happened on Easter Sunday at a GardaWorld facility. NBC Los Angeles reported that it occurred in the 15000 block of Roxford Street in Sylmar in Los Angeles’ San Fernando Valley.Burglars breached the building as well as the safe where the facility stores money, Los Angeles Police Department Cmdr. Elaine Morales told the Los Angeles Times.While the Times reported that as much as $30 million was taken, multiple law enforcement sources familiar with the matter told NBC News they are trying to assess exactly how much money was taken.

Morales did not respond to a request for comment on Thursday, and a spokesperson for the LAPD would not confirm details in the Times’ article.The LAPD and the FBI are conducting a joint investigation, the LAPD spokesperson said. The FBI and GardaWorld were not immediately available for comment.

GardaWorld says on its website that it is a “long-standing security partner of choice to some of the most prominent brands, Fortune 500 corporations and governments.” Its mission is to protect its clients’ assets and operations.The company has 425 branch offices across 45 countries, according to its website.  An employee at GardaWorld told NBC Los Angeles “the place is pretty secure.”

“They check that the alarm is set up, so, just to think that they were able to go through the security system and get away with all that money, it’s a shocker,” said the employee, who asked to remain anonymous.The alleged heist is said to be one of the largest in Southern California and comes two years after the multimillion-dollar theft of jewelry and gemstones from a Brink’s tractor-trailer while the driver was inside asleep. A second driver was away from the vehicle for nearly 30 minutes getting food inside a rest stop. Some have said thieves took 22 bags worth less than $10 million while others believe it was roughly $100 million. No arrests have been made.  On Sept. 12, 1997, $18.9 million was stolen from the former site of the Dunbar Armored facility on Mateo Street in Los Angeles. The robbers were eventually caught, the Los Angeles Times reported.

https://www.aol.com/news/tens-millions-stolen-money-storage-184252654.html

10. Mammal.ai Prof G Blog

https://www.profgalloway.com/mammal-ai/

TOPLEY’S TOP 10 April 04 2024

Daily Top Ten No Comments

1.Disney Chart Action.

DIS broke above red downtrend line going back to 2021

Disney running right up to 200-week moving average

2.This Chart Shows Toyota vs. Tesla Performance

Toyota 11x Earnings vs. TSLA 60x earnings.

3.Biotech ETF Risk On Measure.

XBI pulling back to lower trendline

4.Follow Up to Yesterday’s Gold Comments…Gold Stocks vs. Gold Bullion

Marketwatch By Mark Hulbert

Gold bullion — physical gold has outperformed gold-mining company shares over the past three years by one of the largest margins in decades. Gold recently hit a new all-time high above $2,200 an ounce, while the PHLX Gold/Silver Index XAU is below where it stood three years ago — as you can see in the chart below.

https://www.marketwatch.com/story/buy-gold-or-gold-miners-you-dont-have-to-dig-deep-to-hit-paydirt-98428d04?mod=mw_quote_news

5.Vanguard High Dividend ETF Breaks Out of 2-Year Sideways Pattern

6.Spotify Breaks Above 2021 Levels.

7.Unleased Office Space History

From Barry Ritholtz Blog

https://ritholtz.com/

8.Most Baby Boomers Staying in Current Home.

9.1 in 3 Homes Purchases are Cash.

From Irrelevant Investor Blog https://theirrelevantinvestor.com/

https://theirrelevantinvestor.com/2024/04/03/animal-spirits-the-never-ending-travel-boom/

10.The War Within

By Dina Isola

Investors need not waste time worrying about what they can’t control, like market volatility and its many causes, because there is a greater threat to their financial success and it comes from within.

The internal battle we face is a war between our primitive minds and our current reality, where some of these primal survival skills are outdated, if not useless. The cognitive biases that kept the species alive, can lead to making less than optimal financial decisions – especially if we are unaware of them.

According to James Clear (Atomic Habits), much of our behavior is rooted in reducing uncertainty, relieving anxiety, and winning social acceptance/approval. At the heart of these inclinations is the goal of propagation of the species. Our cognitive biases encourage us to be part of a tribe to stay safe (and alive) in order to multiply.  But for a modern-day investor, the greatest success comes from taking risk, and going against the crowd’s greed or fear. Understanding these cognitive biases is crucial to overriding them and not mistaking them as “gut instincts.”

The Last Experience Might Not Be Replicated

Our ability to not repeat mistakes is the Recency Effect at work, which is how we learn not to touch a hot stove. We associate the last experience in a given situation as one that will be replicated. But, not all situations have as certain an outcome as this. When it comes to investing, this bias leaves investors believing that the next experience they have will be the same as their last (for better, or for worse). This can lead investors to be overly fearful, sitting in cash at the worst time; or, investing aggressively, thinking the next new high is on the horizon. However,  just because it happened last time isn’t a strategy. 

Fear is Instinct, Not Intuition

Survival instincts have us place more emphasis on negative thoughts and perceived threats. This Attentional Cognitive Bias even shapes the way we remember experiences. We are more likely to remember the magnitude of the pain of loss than the highs from the joy of a win. When combined with the Recency Effect, it is a potent cocktail that keeps once-bitten shy investors perpetually sitting on the sidelines, waiting to re-enter, and never able to jump back in. The result is missed opportunity and wasted years that could have been spent compounding investment results to build wealth overtime.

Surrounded by Information and Agreement Clouds Judgment

A cognitive bias made particularly potent in our modern era is Availability Heuristic, which places greater importance on information that is readily available (e.g., virally spread) regardless of its merit. In addition, algorithms serve up a daily diet of content that echoes what we already believe. And this Confirmation Bias creates confidence that we are right because there is a whole tribe of people in agreement. This is how irrational exuberance takes hold, leading investors to gorge en masse on stocks that cost more than they are actually worth.

Dial Back on Emotion

The only way to handle our modern day investment challenges is to dial back on the very thing that helped keep us alive – our emotional response to stimuli. Fortunately, there is data going back to the 1920s that shows how different types of investments have performed over various time frames (with stocks being the strongest performer). We can look to volatile times in the market’s history and see now that these were buying opportunities for long-term investors. While past performance is no guarantee of future results, probability is all an investor can look to.

Still, on an emotional level it can be difficult to make the decision to invest. This is where automation and technology can be used to establish a systematic investment plan to buy every month, regardless of market performance. Automation frees investors from the angst of decision making, or trying to time their investments. It offers a reprieve against the onslaught of  information (and misinformation) that triggers our cognitive biases.

Most importantly, it makes it easier to tune out the noise, resist where our primitive minds would lead us, and learn to  get comfortable with the uncomfortable. And perhaps this is the greatest survival skill of all.

https://www.realsmartica.com/the-war-within/    

Found at Abnormal Returns Blog www.abnormalreturns.com

TOPLEY’S TOP 10 April 03 2024

Daily Top Ten No Comments

1. Q1 Performance Grid

Nasdaq Dorsey Wright

2. More Presidential Election Year Stats

The Hartford

Presidential Election Years Have Been Good for Investors (hartfordfunds.com)

3. European Profits Seeing Upgrades

Dave Lutz Jones Trading European stocks just marked their best quarter in a year as traders remained optimistic about the economy and that interest rates would come down soon. The spotlight is turning to corporate earnings to drive the next leg of the rally in the region’s shares. Analysts expect profits to rebound 4% in 2024 after slumping last year, according to data compiled by Bloomberg

4. Silver Following Gold Break-Out

SLV moves above Dec 2023 levels.

5. Gold Miners Have Been Lagging Gold but Technicals Changing

GDX Gold Miners breaking above 2023 levels

GDXJ Junior Miners Same Story.

6. Treasury Bonds Correlation to Stocks

Morningstar

https://www.morningstar.com/portfolios/which-bonds-provide-biggest-diversification-benefit

7. GDP Per Person …Poland Leads Despite Russia on Doorstep

8. Americans are Eating Out More than Ever

Ben Carlson

https://awealthofcommonsense.com/2024/03/are-we-living-in-the-roaring-20s/

 

9. Median Home Prices See Sharp Slowdown

10. 8 Things I Managed to Get Right When I Retired

Psychology Today Meg Selig

What did that path look like? Here is a rough account of my retirement journey:

1. I had enough money. I was fortunate to build my retirement on a solid financial foundation. I say “fortunate” because I was not money-savvy during most of my early life. Just by luck, my various jobs in education and counseling were all part of the same healthy public school retirement system. When I was ready to retire after over 32 years in education, a traditional pension was waiting for me. Thanks to my union, the National Education Association (NEA), I was able to escape the burden of money worries that contribute to anxiety and depression among retirees and workers alike.

2. I had a sense of purpose. While I loved my last, longest, and best job as a counselor at our local community college, I had an intense desire to write a book on successful habit change. I already was teaching a short personal development course inspired by the loss of a wonderful aunt who had died from lung cancer because she couldn’t stop smoking cigarettes.
I figured it was now or never for my writing ambitions. But would it work out? Freelance writing is a chancy business. I’m not a risk-taker nor particularly entrepreneurial. What would I do with myself if I had no job or meaningful preoccupation? I sensed that, for me, a sense of purpose would be essential to a happy retirement. (As it turns out, many retirees feel the same way.)

3. I retired gradually. To hedge my bets, I decided to continue to work part-time at the college after retirement. I checked with my supervisor; luckily, he was happy that I could still be a resource for the counseling department even after I took the retirement plunge. I would be able to teach short courses part-time, plus I could help out during registration. I worked part-time for about four years while I labored on the book that would become Changepower! 37 Secrets to Habit Change Success. Nowadays, retiring gradually is often dubbed a “phased retirement.” A Yahoo! Finance article predicts that phased retirements will be the wave of the future; if so, I was just slightly ahead of my time.

4. I stayed in touch with my work friends. I still meet regularly with my beloved colleagues from the college. And “beloved” is not too strong a word to describe how I feel about my fellow and sister workers. Two colleagues and I have had monthly lunches together for at least 10 years. My wonderful supervisor of over 20 years throws a yearly holiday party that I would not miss for the world. Here, I reconnect with lovely people, catch up, and reminisce.

5. I had a little bit of luck—OK, a lot of luck. With the help of another colleague, I succeeded in finding a publisher for my book. The cream in the coffee was that the publisher linked me to the blogging opportunity here at Psychology Today, a creative outlet that I’ve enjoyed for 14 years and counting. At that point, I retired from part-time work at the college and became a full-time author.

6. I created a helpful structure for my days. Some people nearing retirement probably have a rosy picture of sleeping late and then doing whatever they want whenever they want. More power to them. But oddly enough, research indicates that a predictable and pleasant daily structure is linked with both happiness and mental health.  My weekday schedule was built around my goals of health, purpose, pleasure, and relationships. For the curious, it usually includes breakfast, 20-30 minutes of exercise, business details and email, lunch with friends or with the New York Times crossword puzzle, writing, watching Jeopardy, dinner, reading, or TV.

7. I am grateful to have a solid support system of family and friends. I have a supportive partner who loves to cook. He cooks dinner! Think of the time I save. Although my family lives elsewhere, we speak frequently and visit regularly. I Zoom with my granddaughter once a week. I have regular lunches or coffees with close friends.

8. I make room for volunteer work, fun, and mini-adventures. While our interest in big travel has waned as we’ve aged, we still enjoy one-tank trips to various spots near home and are dedicated in-town tourists.

https://www.psychologytoday.com/us/blog/changepower/202403/8-steps-toward-a-happy-retirement

TOPLEY’S TOP 10 April 02 2024

Daily Top Ten No Comments

1. Mega-Cap vs. 490…2000-2024

2. History of S&P Returns After Back to Back 10% Quarters

From Dave Lutz at Jones Trading Bespoke notes the S&P just had the second straight quarter of double-digit percentage gains. That hasn’t happened in 12 years.

https://www.bespokepremium.com/

3. What’s Cheap? What’s Expensive? Vs. 10-Year Average

Equities: The S&P 500 equal weight index valuation (forward PE ratio) is now firmly above the ten-year average.

Source: The Daily Shot  https://dailyshotbrief.com/

4. Commodities Have Been Cheap vs. S&P for 15 Years

5. Investment Grade Bonds Failing to Break-Out

6. GOOGL Just Broke Out to New Highs

Lowest P/E stock in Mag 7

7. Spike in Cocoa Prices Hit Hershey…-30% from Highs

HSY stock hanging at 200-week moving average for 6 months.

8. Cruises Go Upstream? Ritz-Carlton and Four Seasons

https://www.ritzcarltonyachtcollection.com/?campaignid=1064612570&adgroupid=157412832688&creative=667146363725&utm_source=google&medium=cpc&gad_source=1&gclid=CjwKCAjwtqmwBhBVEiwAL-WAYXr_HNwTg7Delg0He_eHGU5AIn5yvxuGjcdbUKAWcjd49thzx5LQtxoC_04QAvD_BwE

https://www.fourseasonsyachts.com/

9. WSJ-New Entrepreneurship in America

 

By Ruth Simon https://www.wsj.com/business/entrepreneurship/latinos-are-starting-u-s-businesses-at-a-torrid-pace-64773fc3

10. Stephen A. Smith says opportunities are ‘the only thing that should be equal,’ not outcome

Opinion by Alexander Hall

Stephen A. Smith, an ESPN commentator known for his hot takes on sports and politics, sounded off on the idea that many Americans, including those in politics, expect equality of outcome rather than opportunity.

During an appearance on the PBD Podcast hosted by Patrick Bet-David, Smith called upon Americans to accept the fact that “people who produce more ultimately end up more successful than those who don’t.” 

He went on to observe, “We just have too many people in this world, especially on Capitol Hill as well, that want to give this impression or want to literally go about the business of changing that and making things equal. The only thing that should be equal is opportunities. But what you receive from your level of production is on you.”

His speech on meritocracy began earlier in the podcast when he said, “One of the things that I have a problem with when I look at things that are transpiring in this country, you can’t in the same breath talk about capitalism, talk about how it’s equal opportunity that we want, but everybody doesn’t deserve the same, it’s about your level of production. Some people are high-end earners, some people are high-level producers and stuff. And you know, they’re getting treated, they might earn more than somebody that just don’t have that skill set. That’s the world we’re living in.”

By contrast, the commentator argued that there are “a lot of people here that want to act as if ‘You know what? We’re after a different culture. We want everything the same for everybody.’” To those people, he declared, “You’re lying. You are lying.”

Smith then recalled he and his mother’s humble origins: “I grew up in the streets of Hollis, Queens, New York City. My mother was on welfare for a little while. And it killed her, killed her.”

“Wow,” Bet-David replied.

The sports commentator added “She was sick to her stomach that we had to get government cheese and bread and all of this stuff, and she got the hell off of it as soon as she possibly could. And I know that when she sent me out there to work, she didn’t send me out there to be like just anybody. She sent me out there to be the best that I can be. Why? So I can earn more for myself than the average typical person, and most people in a capitalistic society believe in that.”

Smith went on to reiterate his earlier critique, “When you have folks walking around, like everybody is supposed to be the same — that’s nonsense. You’re lying to the American public, you’re lying to yourself, it’s not true. And in the end, people who produce more ultimately end up more successful than those who don’t.”

He added, “Jimmy Johnson, the former coach of the Dallas Cowboys said it best, ‘I will be very consistent in my inconsistencies. Those who produce will be treated better than those who don’t.’ And I appreciated his candor. Whether you like it or don’t, that’s the reality.”

Stephen A. Smith says opportunities are ‘the only thing that should be equal,’ not outcome (msn.com)