@realmoney
Oct 26, 2020 | 12:50 PM EDT DOUG KASS
Price Is Not Necessarily Truth (Part Whatever)
* Our investment world has changed
* And not for the better
I don't believe that price is truth as the changed market structure -- passive products and strategies that generally
Oct 26, 2020 | 12:50 PM EDT DOUG KASS
Price Is Not Necessarily Truth (Part Whatever)
* Our investment world has changed
* And not for the better
I don't believe that price is truth as the changed market structure -- passive products and strategies that generally
worship at the altar of price momentum -- exaggerate price action.
It is my view, therefore, as I have written often, that these strategies have made the interpretation of charts less valuable than in the past.
Partially as a consequence, I have a feeling when some bullish
It is my view, therefore, as I have written often, that these strategies have made the interpretation of charts less valuable than in the past.
Partially as a consequence, I have a feeling when some bullish
technicians turn bearish, if prices continue lower, I will be turning bullish.
It doesn't mean that the technicians will be wrong and that I will be right.
I am just pointing out that, and why, I believe that charts have lost some of the reliability of the past.
That said,
It doesn't mean that the technicians will be wrong and that I will be right.
I am just pointing out that, and why, I believe that charts have lost some of the reliability of the past.
That said,
I continue to hold to the view that "The Biden Bump," which produced a near 350 handle rise in the S&P Index, from September, is over and we have moved to a more volatile timeframe which may be accompanied by lower stock prices.
My "fair market value" of the S&P Index remains
My "fair market value" of the S&P Index remains
at 2800-3000, compared to current cash at about 3395. This means the S&P is about 15% to 20% overvalued. Again, I have five different scenarios (economic and profit growth, inflation, interest rates, policy, etc.) and I attach a probability to each to come to an intrinsic value
calculation. Given the plethora of uncertainties I have a broad range vs. a specific price point which I have had historically.
As I have noted in the past, markets rarely spend time at my "fair market value" - markets tend to be undervalued and overvalued. Sometimes for
As I have noted in the past, markets rarely spend time at my "fair market value" - markets tend to be undervalued and overvalued. Sometimes for
great periods of time.
For perspective, there have been only two periods in the last several years that stocks trade below my "intrinsic value" - in late 2018 and in March 2020.
At both times I unemotionally got very long in exposure.
Given some risks associated with the
For perspective, there have been only two periods in the last several years that stocks trade below my "intrinsic value" - in late 2018 and in March 2020.
At both times I unemotionally got very long in exposure.
Given some risks associated with the
election next week and into some typical seasonal strength near year-end, I don't think the big one - a large decline under "fair market value" - occurs until next year.
Over the next two weeks I will be addressing the intermediate term risks that I see. @threadreaderapp unroll
Over the next two weeks I will be addressing the intermediate term risks that I see. @threadreaderapp unroll
• • •
Missing some Tweet in this thread? You can try to
force a refresh
