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Brad Kenagy

 
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  • Is Gold Foreshadowing A Stock Market Implosion? [View article]
    Great article, I completely agree with your conclusion that there is a possibility that gold could be the canary (also yellow like gold) in the coal mine for a major market correction.

    Whats odd is the dollar index, usually, gold is inversely correlated to the dollar, and looking at the chart for the Dollar index it hit a low at around 11 am which is the same time the GLD hit its morning low. After that the Dollar index hit a low it proceeded to rise steadily the rest of the trading day, and gold went sideways for awhile then fell off even more.

    I think the move in gold is currency driven, in my recent article about reasons could should be increasing: central bank buying,expense for miners are rising and are cutting back mining, rising US debt limit all of which are strong fundamental reasons why gold should be increasing, but I think the strong dollar has been hurting gold.

    What is really bad is the correlation, I use a 3 month correlation and SPY,and UUP are currently correlated over 80% and the last time that happened was 12/14/2007. So in a correction of stocks dollar usually rises, which would mean possible further pain for gold.
    Apr 14, 2013. 11:54 AM | 3 Likes Like |Link to Comment
  • It Is Not Different This Time - It Is Worse [View article]
    @shourey Production boomed because of Science and technology NOT because of any policy of President Obama. We would not have had the oil and gas production today without the science to find new oil fields (ie the Bakken and others) and the technology (fracking, horizontal drilling, etc.)

    If production has boomed why have gas prices gone up under president Obama? The reason why prices have gone up...is Obama's EPA and its regulations. It is not cost effective for refiners to build a new refinery to refine crude for gasoline for Americans.

    The high production is a double edged sword, because of the high production here, our price of crude oil [WTI] is much lower than Brent. Because of that refiners are choosing to buy crude at WTI prices, refine it, and export it to the rest of the world for the Brent Prices. Look at the charts of the refiners over the since the last time Brent & WTI traded at the same price which was October 18 2010, the data backs up my point.

    Major refiners returns since that date:

    Valero Energy Corporation (VLO): +143%
    Tesoro Corporation (TSO): +299%
    HollyFrontier Corp. (HFC): +208%
    Apr 8, 2013. 12:10 PM | 3 Likes Like |Link to Comment
  • How To Be Protected Before The Next Market Crash [View article]
    In your hedging your long portfolio, the only problem I see is that SPY, and SDY and 96% correlated. I would keep SDY because it has a higher dividend yield than the SPY, and replace, SPY with an international ETF like the WisdomTree Emerging Markets Equity Income ETF (DEM) which has a 82% correlation to the SDY.

    The results using ETFreplay.com since July 13th 2007, which is DEM inception date.

    Your Hedging Portfolio: 43.8% Total Return with 7.4% Volatility.
    Your Portfolio with my suggestion: 47.1% Total Return with 7.9% volatility.

    So with my single improvement you get:

    -A Better risk adjusted return.
    -More Diversification
    -Lowers your equity correlation to each other


    Just a thought.
    Apr 7, 2013. 11:51 AM | 3 Likes Like |Link to Comment
  • Gold Takes Out Major Support: Next Stop $1,350 [View article]
    I disagree you, gold has not broken its support, using the spot price, not the price of the GLD, as I show in my article I wrote yesterday, there is a strong support at the $1526.50 level, which has been tested twice and held, so that is the level I am watching, if it breaks that the next level of support is at $1433.40, but I believe that gold will hold the $1526.50 level.

    http://seekingalpha.co...
    Apr 3, 2013. 07:24 PM | 3 Likes Like |Link to Comment
  • Bear Of The Day: Rentech Nitrogen [View article]
    I agree with Jonathan, I hold shares of RNF @ around $46/share. I knew that there would be risks in buying knowing that this year would be full of the maintenance outages, upgrades and expansions, while they were not producing, thus lowering the distribution. My purchase @ $46/share was my initial position, and I will be adding to it this year in anticipation of 2014 and 2015 when everything is upgraded and expanded distributions will grow. RNF has support between the 30-32 level so if that level holds I will be purchasing more.
    Apr 2, 2013. 07:35 PM | 3 Likes Like |Link to Comment
  • By a 75-24 margin, the Senate has passed a non-binding vote of approval for a bill allowing states to collect sales taxes from online retailers with $1M+  in annual sales and no presence within a given state's borders. The margin of victory suggests a filibuster shouldn't be a problem when a binding vote is made. Amazon (AMZN) and eBay (EBAY) have already begun collecting in a number of large states, and many investors have already assumed collections will expand in time. (previous[View news story]
    Let me ask you this, how many of the 46 million people on food stamps do you think are investing in the stock market? If over 10% of the population needs assistance just to buy food, there is no way they can afford to be buying stocks, so a rising stock market does not help them at all!
    Mar 24, 2013. 06:47 PM | 3 Likes Like |Link to Comment
  • Stocks And Commodities Signaling A Downturn [View article]
    To answer your question.

    -No I have not bought any options because Options trading is not allowed in my Roth IRA. As for the VIX, no I do not buy anything VIX related for two reasons.

    -Most VIX products are ETNs, and I stay away from ETNs, and second, volatility is a trading vehicle, and I only like picking investment options that I could hold for a long period of time.

    If I was absolutely forced to choose a VIX product, to minimize my risk I would choose either

    iPath S&P 500 Dynamic VIX ETN (XVZ) OR
    UBS ETRACS Daily Long-Short VIX ETN (XVIX)
    Mar 13, 2013. 05:48 PM | 3 Likes Like |Link to Comment
  • 5 ETFs For Retirement Income For Less Active Investors [View article]
    Very good article, it is very similar to my article I wrote last year.

    A couple thoughts, I assume since I didnt see anything that each ETF is weighted equally? Also you seem to have overlap with FGD, and DTH, which are both international dividend ETFs. So I ran your portfolio up against mine using etfreplay.com from March 11 2009 which is the farthest back data goes for LWC.

    -Your Portfolio: +144.9% total return with 18.6% volatility.

    Risk adjusted return: 144.9/18.6= 7.79% return/unit of risk

    -My Portfolio:+119.6% total return with 11.3% volatility.

    Risk adjusted return: 119.6/11.3=10.58% return/unit of risk.

    Yield Comparison [My Portfolio]
    Weight Yield W*Y
    30% 4.78% 1.43400%
    25% 6.65% 1.66250%
    20% 7.88% 1.57600%
    15% 6.22% 0.93300%
    10% 1.43% 0.14300%

    Portfolio Yield 5.75%

    Yield Comparison [Your Portfolio]
    Weight Yield W*Y
    20% 4.95% 0.99000%
    20% 6.55% 1.31000%
    20% 4.10% 0.82000%
    20% 4.60% 0.92000%
    20% 5.99% 1.19800%

    Portfolio Yield 5.24%


    The main difference in our portfolio's is I weighted mine by volatility, so less volatile funds got more weight in the portfolio. Your portfolio is a good start, if it were me i'd swap out FGD, and go with a more US centric dividend ETF like the iShares High Dividend Equity ETF (HDV), or WisdomTree Equity Income ETF (DHS). Just a couple things to think about.


    http://seekingalpha.co...
    Mar 13, 2013. 11:39 AM | 3 Likes Like |Link to Comment
  • The Coming Crash In The Bond Market [View article]
    I wrote an article last year in May, where I constructed a simple rising rates portfolio for when inflation kicks in. The portfolio has no leveraged inverse treasury funds like TBT.

    My Portfolio I created in my article:

    iShares Floating Rate Note (FLOT)
    PIMCO 1-5 Year US TIPS Index ETF (STPZ)
    PowerShares Emerging Markets Sovereign Debt (PCY)
    ProShares Short 20+ Year Treasury (TBF)
    iShares High Dividend Equity (HDV)

    At the time of writing the article the rate on the 10-year treasury was 1.70%.

    The results of the portfolio I created since then compared to popular bond funds:

    -My Portfolio: 5.5% Return with 3.0% Volatility OR 1.83% Return /volatility
    -AGG: 1.3% Return with 2.4% Volatility OR 0.54% Return /Volatility
    -LQD: 5.8% Return with 4.1% Volatility OR 1.41% Return/ Volatility
    -TIP: 1.4% Return with 4.3% Volatility OR 0.32% Return/Volatilty

    http://seekingalpha.co...
    Mar 10, 2013. 11:55 AM | 3 Likes Like |Link to Comment
  • Fed Stress Tests: Ally Financial is the only bank not meeting the Fed standards.  All of the other 18 holding companies showed a Tier 1 Common Ratio higher than 5% under the central bank's severe loss scenario. [View news story]
    As noted on CNBC today, US Bank stress test DO NOT take into account what would happen to derivatives held by banks. Where as European bank stress tests include derivatives in their stress tests.
    Mar 7, 2013. 09:47 PM | 3 Likes Like |Link to Comment
  • 5 Reasons The S&P 500 Could Fall 20% By The End Of 2013 [View article]
    GHargis Thank you for your comments I agree with you. With the massive amount of QE in the market, this has led to inflation in food and energy prices. There is very little or no economic growth. So what is the name for the condition where there is a lack of growth, and rising inflation? STAGFLATION !!!!
    Feb 21, 2013. 10:00 PM | 3 Likes Like |Link to Comment
  • 5 Reasons The S&P 500 Could Fall 20% By The End Of 2013 [View article]
    Thank you for your comment. I have a chart for you and everyone else to look at that shows the Federal Reserve Balance sheet total. TO answer your question QE was not responsible for the 2008 financial crisis, it was housing, loan underwriting standards, and excessive leverage at financial institutions.The chart clearly shows there was no excessive QE leading up to the financial crisis of 2008.

    http://bit.ly/WZMDj3
    Feb 21, 2013. 05:49 PM | 3 Likes Like |Link to Comment
  • Seeking Alpha Trading Survivor Contest [View instapost]
    Reminder!! Everyone please submit your picks for the second month of the contest.

    Here is the leaderboard so far:

    realornot RIMM 31.22%
    dd2020dd XIV 19.88%
    E.W. Barnaba XIV 19.88%
    mktlab68 VHC 19.25%
    Chasing the Vig HLF 18.26%
    izzygemini ZNGA 17.36%
    Matt Schilling DNDN 15.72%
    mrcoleslaw SNTS 14.63%
    David Klein WRLS 14.49%
    Bill Mauer ISRG 14.10%
    allupside EZPW 12.49%
    Josh Krause SODA 10.28%
    soundstock KMP 9.97%
    Welt FUN 9.66%
    Ypa Finance NVR 9.52%
    Tom Guttenberger XIN 4.11%
    Brad Kenagy BGCP 3.67%
    Parabana Miterjee BBBY 3.61%
    Ghosts Of Kariela AIG 2.78%
    Joe Kelly GTAT 1.26%
    Ocean Man WTW 0.71%
    Modernist GLRE 0.00%
    Zach Tripp GLW -6.03%
    Jim Van Naseum FSLR -7.48%
    Seth Walters PIR -7.66%
    Peter Larson AMZN -7.67%
    Brian L.Wilson PCRX -11.66%
    Jan 28, 2013. 07:42 PM | 3 Likes Like |Link to Comment
  • The money management business inspires a lively exchange at the Barron's Roundtable, with Brian Rogers' liking of Legg Mason (LM) as either a value or takeover play getting the thumbs up from Mario Gabelli, but a razzing from Bill Gross who says the stock-picking industry is in secular decline thanks to ETFs. Gabelli to Gross: "If you want to preach in favor of mindless investing, we don't have to stand by." [View news story]
    A great example Gabelli Small Cap Growth AAA (GABSX) compared to the Vanguard Small Cap Growth ETF (VBK) since VBK inception on 1/30/2004.

    Gabelli Fund: +49.21%
    Vanguard ETF: +94.80%

    So score one for the ETF.

    Gabelli Fund expense Ratio: 1.42% + .25% 12b-1= 1.67%
    Vanguard ETF expense Ratio: 0.10%

    Score another one for the ETF.

    So for an extra 1.57% in fees you can Underperform an ETF targeting the same group of stocks [ small caps] by 45.49%.
    Jan 27, 2013. 01:47 PM | 3 Likes Like |Link to Comment
  • A Simple Retirement Portfolio Anyone Can Build (Equal Sector Weights): Year-End Update [View article]
    Why not just do the following portfolio to cut your trading costs:

    ALPS Equal Sector Weight ETF (EQL) Yield: 3.19%
    -The index is comprised in equal proportions of the nine Select Sector SPDR Indexes.

    iShares Gold Trust ETF (IAU)
    PowerShares Emerging Markets Sovereign Debt Portfolio ETF (PCY)

    SPDR Wells Fargo Preferred Stock ETF (PSK)

    Using http://bit.ly/WONj8j
    Allocations:

    EQL: 25%
    IAU: 25%
    PCY: 25%
    PSK: 25%

    Compared to the S&P 500 (SPY), since Sep 17th 2009 which is as far back as data goes for all 4 funds:

    Portfolio Total Return: 46%
    Portfolio Volatility: 8.9%

    SPY Total Return: 40.5%
    SPY Volatility: 18.1%

    So overall nice idea for equal weighting sectors, and mixing in Gold, Preferred stocks, and Emerging Market debt, but you could cut your transaction costs alot by owning EQL instead of owning around 15+ stocks, and still have a portfolio that has a Higher return than the SPY, and with almost half as much volatility.
    Dec 28, 2012. 10:05 PM | 3 Likes Like |Link to Comment
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