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Eric Parnell, CFA

 
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  • Are Stocks Set For A Major Decline In The Fall?
    Today, 12:40 AM SPY, DIA, IWM 65 Comments

    Summary

    • The market news coverage is becoming increasingly polarized.
    • On one side of the debate are those that believe the sky is the limit for stocks in the months ahead.
    • On the other side of the discussion are those that expect a significant stock market pullback is not only imminent but also long overdue.
    • Market history provides important clues as to whether the stock market is indeed setting up for a major decline in the fall of 2014.
  • A Market That Defies All Expectations
    Sun, Aug. 17 AGG, IEF, PFF 28 Comments

    Summary

    • A constant refrain over each of the last six years has been the imminent bursting of the bond market bubble.
    • But the bond market continues to rallying smartly in 2014.
    • The bull market in bonds is now in its 32nd year and remains very much intact.
    • The latest rally in bonds has brought with it a new and unusual cast of asset class characters this time around.
  • 2 Key Tests For The True Dividend Growth Investor
    Editors' Pick • Thu, Aug. 14 BCR, BKLN, HYG 232 Comments

    Summary

    • Dividend growth investing is one of the most popular and time-tested stock market investment strategies.
    • Who among us are truly dividend growth investors? Do you pass the two key tests?
    • Will you be ready to not only withstand, but capitalize on the potential risks that lie ahead?
  • A Crisis Less Extraordinary
    Thu, Aug. 14 SPY, DIA, QQQ 37 Comments

    Summary

    • It is often said that the financial crisis that was unleashed from July 2007 to March 2009 was a once in a century event.
    • But upon closer examination, the market shock resulting from the financial crisis was not all that extraordinary.
    • In fact, it was rather modest in many ways when compared to other major historical bear markets.
    • And this fact alone may be setting investors up for a far more challenging bear market experience the next time around.
  • Euro Trashed
    Tue, Aug. 12 EPP, EWC, EWD 20 Comments

    Summary

    • European stock markets have been absolutely trashed in recent weeks.
    • This recent sharp decline has raised concerns among investors about whether such trends may soon spread to other global markets including the U.S.
    • A closer look at the trading climate around the globe provides clues as to what we might expect in the coming days and weeks.
  • Hunting For Bears
    Sat, Aug. 9 BRC, CVD, DIA 18 Comments

    Summary

    • Trouble is increasingly brewing under the stock market surface, as a growing number of stocks are finding themselves mired in their own individual bear market.
    • Where there are meaningful corrections, so too there are opportunities.
    • Today is a good time to get started in hunting for bears.
  • A Surprising New Portfolio Diversifier
    Editors' Pick • Fri, Aug. 8 CMS, CNP, D 50 Comments

    Summary

    • Portfolio diversification is a primary objective for most investors in any market environment and a particularly high priority today.
    • In 2014, a surprising new category has emerged from within the stock market itself to become an effective portfolio diversifier in the current environment.
    • Utilities are providing a far greater diversification benefit today than normal and may be worth a closer look following a recent pullback.
  • The Slow And Perilous Death Of Bull Markets
    Thu, Aug. 7 SPY, DIA, QQQ 35 Comments

    Summary

    • A primary worry among many stock investors today is that the long running bull market may soon come to an end.
    • At the heart of their concern is the worry that the subsequent decline into the next bear market could quickly become swift and severe.
    • History has shown that the transition from a bull market to a bear market is a process filled with rallies and correction that plays out over an extended period of time.
    • Bull markets die long slow deaths, and it is this prolonged dying process that causes so many investors to find themselves unwittingly trapped in the next bear market.
  • 3 Keys To Watch In The Week Ahead
    Sun, Aug. 3 AMZN, HYG, IWM 16 Comments

    Summary

    • While the magnitude of the pullback has thus far been modest at just over -3%, some investors are wondering whether this is the start of something bigger.
    • Three key leading indicators for the broader market are worth watching in the coming week.
    • These three readings may foretell whether far greater declines may soon be in offing even if the broader market manages to find its footing.
  • The Good News From A Bad Friday
    Fri, Aug. 1 GLD, HYG, IWM 100 Comments

    Summary

    • Friday was another down day for stocks, following the notable -2% decline on Thursday.
    • But despite the generally poor performance of stocks on Friday, several important points of good news accompanied the bad.
    • Overall, investors could find reassurance at least as we head into the weekend that the latest stock market correction is taking on a more orderly behavior.
  • Why Thursday's Sell-Off Matters
    Editors' Pick • Thu, Jul. 31 CWB, EEM, EFA 263 Comments

    Summary

    • The stock market was rocked on Thursday, posting its worst single day decline in nearly four months.
    • Such declines are not unexpected, but Thursday's decline was both notable for a few key reasons.
    • Thursday's sell-off matters, and how events unfold in the coming days should be watched closely for potential action, if necessary.
  • Is A Stock Market Correction Imminent?
    Sun, Jul. 27 EFA, GLD, HYG 175 Comments

    Summary

    • The stock market is overdue for at least a modest pullback in the near-term.
    • When exactly might we expect such a correction to take place?
    • How far can we expect the stock market to fall once it finally arrives?
    • How should investors react once this correction finally takes place?
    • And what will this anticipated correction mean for the sustainability of the long running bull market?
  • S&P 500: Still Trading Below 2000 A Decade From Now?
    Fri, Jul. 25 SPY, DIA, QQQ 19 Comments

    Summary

    • It is only a matter of days before the S&P 500 smashes through the 2000 barrier.
    • But just as trees do not grow to the sky, neither do stocks.
    • What can we reasonably expect over the next decade?
  • A World Without Consequences
    Thu, Jul. 24 AIG, BAC, BKLN 50 Comments

    Summary

    • We are increasingly living in a world without consequences.
    • What was once true in financial markets has increasingly spread to the geopolitical stage.
    • The potential cost down the road for this apparent lack of accountability today could be extreme.
  • On The Fourth Of July: Bullish On America
    Fri, Jul. 4 SPY, DIA, QQQ 40 Comments

    Summary

    • The United States of America is well-positioned to lead the global economy in the 21st century.
    • A number of forces are supportive of the America's continued strength.
    • It is time for policy makers, including the Fed, to allow the U.S. free market system to stand on its own.
  • Less Than Zero: The Case For Cash
    Sun, Jun. 29 GLD, HYG, LQD 39 Comments

    Summary

    • Investors receive virtually no direct reward for holding cash in the current market environment.
    • But the case for holding cash may be growing stronger as the stock market continues to rise.
    • A number of reasons support why investors may want to consider holding at least a portion of their portfolio in cash in the current environment.
  • The Way Of The Bull And The Bear
    Editors' Pick • Fri, Jun. 27 GLD, SDY, SPLV 130 Comments

    Summary

    • Investors are seemingly more anxious as the markets become more calm.
    • Regardless of the investment path you are following, we all share the same goals.
    • While we cannot predict the future with complete certainty, the one constant we know is change.
    • Those investors that maintain openness in their strategy and have established a thoughtful path for the short-term, intermediate-term and long-term are best positioned for success and happiness in the end.
  • This Is When The Bear Growls
    Fri, Jun. 20 SPY 344 Comments

    Summary

    • Some investors are bracing for the potential of a meaningful correction.
    • But when exactly might such a correction finally take place?
    • History provides some notable clues.
  • Welcome To The Machine
    Thu, Jun. 19 CVX, FXI, GLD 26 Comments

    Summary

    • Machine like forces are driving capital markets today and it is important to embrace this reality when investing.
    • Investment markets continue to provide an important vehicle to generate a higher rate of return on long-term savings.
    • Investors can remain dedicated to their artistry just as long as they have a sound strategy to incorporate it with the broader forces that are driving the market.
  • 4 Dark Horse Stocks For The Next Bear Market
    Tue, Jun. 17 NWN, SDY, TMP 51 Comments

    Summary

    • Many investors today remain understandably skeptical of the market rally.
    • Yet despite these notable challenges, stocks remain persistent in pushing to the upside.
    • Investors may be on the lookout for stocks to participate in further market upside, but also protect against downside when the next bear market finally arrives.
    • The market also offers a select group of dark horse stocks that may merit consideration in this regard.
  • War Will Not Deter This Market
    Tue, Jun. 17 SPY, DIA, QQQ 22 Comments

    Summary

    • News headlines have recently been filled with reports of mounting geopolitical conflict across many parts of the world.
    • Some of these conflicts have economic implications including the potential disruption of global oil and energy supplies.
    • But using history as a guide, stocks are unlikely to be deterred from advancing by these growing risks.
  • Market Lessons From Iraq, Bergdahl And Cantor
    Sun, Jun. 15 DIA, SPY, QQQ 40 Comments

    Summary

    • The news headlines over the last few weeks have been filled with several notable headlines.
    • Leading among these is the outbreak of sectarian fighting in Iraq, the recent release of U.S. Army soldier Bowe Bergdahl and the stunning primary upset of Eric Cantor.
    • Underlying each of these newsworthy events are important central lessons that can be applied to investment markets today.
  • In Search Of... Stocks With Attractive Absolute Value
    Fri, Jun. 13 AFL, ALL, DE 19 Comments

    Summary

    • High quality stocks that offer truly attractive absolute value are vanishing from the investment landscape.
    • This is a category that has traditionally served investors well during the "Greenspan put" era.
    • A select few names remain in this group today that may merit investor consideration.
  • The Danger Of Buying The Next Dip
    Wed, Jun. 11 SPY, DIA, QQQ 51 Comments

    Summary

    • A common refrain among many investors today is that they are poised to capitalize on the next market dip.
    • But does such a strategy make sense at this late stage of the current bull market?
    • A check on market history over the last century provides some useful clues.
  • Bear Repellent For Your Stock Portfolio
    Sun, Jun. 8 CVX, MCD, PG 48 Comments

    Summary

    • Many investors that are skeptical of today's bull market face a dilemma - buy now and absorb losses or sell now and miss further gains.
    • By applying "bear repellent" to their stock portfolio, investors can maintain stock allocations while also protecting against the risk of bear market declines.
    • Three additional steps among others in the stock screening process may be worth consideration in applying bear repellent to a portfolio.
  • Timing Is Everything
    Fri, Jun. 6 DIA, SPY, QQQ 86 Comments

    Summary

    • The potential for stocks to enter into a major bear market in the coming years is meaningful.
    • This does not mean that investors should evacuate the market today.
    • Timing is everything when it comes to managing your stock portfolio in the current environment.
  • The Worst Bear Market Is Yet To Come
    Thu, Jun. 5 DIA, SPY, QQQ 96 Comments

    Summary

    • Despite the seemingly unending investor optimism more than five years into the current bull market, some worrisome issues are continuing to build under the surface.
    • While the timing still remains uncertain, the next bear market has the potential to be even worse than the two previous downturns once it finally arrives.
    • In the end, the next bear market may both last longer and result in a greater overall peak to trough decline for several reasons.
  • Zen And The Art Of Market Cycle Maintenance
    Sun, Jun. 1 HYG, LQD, SPY 27 Comments

    Summary

    • Two distinct viewpoints are currently defining the discussion as to how we should view the market rally that has taken place over the last five years.
    • These are the “romantic” and the “classical” perspectives, and they have widely divergent opinions between the two about how to approach today’s market.
    • Which of these two investor types are likely to be most successful when managing their portfolio and investment decisions in the current and future market environments?.
  • Beware The Placid Island Of Investment Ignorance
    Editors' Pick • Thu, May. 29 BKLN, HYD, HYG 35 Comments

    Summary

    • Volatility is remarkably calm across some of the highest yielding asset classes in capital markets.
    • This calm is obscuring potentially major risks that may negatively impact investors going forward.
    • Now is not the time for complacency when allocating to these seemingly quiet investment opportunities.
  • Stocks Need To Breakout Before They Breakdown
    Sun, May. 25 DIA, SPY, QQQ 22 Comments

    Summary

    • Many investors are understandably wondering whether the recent sideways pattern in stocks may be the last gasp peak before stocks turn definitively lower.
    • The languid performance of stocks over the last three months is actually short-term bullish for the market to reach fresh new highs in the coming weeks.
    • What lies beyond any higher peaks, however, may be an entirely different bearish story for investors.
  • 4 Aristocrats Trading With The Hoi Polloi
    Sat, May. 24 DTV, NUE, SDY 41 Comments

    Summary

    • Dividend Aristocrats as a group have outperformed the S&P 500 since the outbreak of the financial crisis in July 2007.
    • Despite this collective outperformance, a select few aristocrats have trailed the broader market over this time period.
    • It is among these aristocratic laggards where some interesting value and potential return opportunities may reside going forward.
  • The Greatest Farce On Wall Street
    Fri, May. 23 SPY, DIA, QQQ 36 Comments

    Summary

    • The analysts’ earnings estimate game is arguably the greatest farce on Wall Street.
    • It is a primary information source that many experts and the media cite in valuing the market and projecting its future performance.
    • But a look at these estimates through a variety of perspectives reveals the flaws associated with the process.