Zachary Scheidt

Sell in May and Go Away: Good Advice?

Emerald: You bring up a good point with the velocity of money. Up to this point we have had very little velocity, but the problem is that once the velocity ticks up even just a little bit, the sheer AMOUNT of currency created could be a big problem. The Fed can't just pull money out of the system quickly and quietly. Inflation doesn't take long to breed in these conditions.

Alphameister: It's been interesting to see exactly WHICH issues have had the strongest gain. Bespoke had an interesting piece which showed that stocks with weaker relative strength over the last 12 months actually rallied the most. This could certainly indicate a dead cat bounce (we need quality stocks to keep us going). At the same time, performance anxiety continues to push us higher and could eventually lead the fundamentals to follow the market in recovering.

Capt Brian: If it gets that bad, I want a spot in YOUR compound :-) and if you're right, then there's probably very little that a strong investment approach would do for any of us. I certainly hope we're not facing an Armageddon type scenario.

Thanks guys for your comments - definitely keeping it lively!
Zach
zachstocks.com

Sell in May and Go Away: Good Advice?

MHFT - Thanks for the advice... while it sounds great and I certainly hope to get the 9 iron out at least a few times, your comment makes me consider buying LVS :-) Hope you have an awesome summer and get a great buy on some property.

LilBob - I've got some rental property and I think you're right for the long-term. I would caution to make sure you are adequately capitalized before making a rental purchase. Expect some time here and there with no tenants and make sure you can carry the property even if it doesn't rent for quite some time. Personally, my one tenant just lost his job which makes the situation a lot more interesting...

Freya - an interesting thesis for sure. I certainly expected this rally to last beyond the one or two weeks the talking heads had called for, but am getting a bit uncomfortable with extended long positions now. Maybe I'm not alone - if so then your argument makes a lot of sense. But it seems to me people are getting a bit too comfortable for my liking.

At any rate, there will be plenty of opportunity on an individual security basis. I disagree with Mad Hedge Fund Trader and think you can always find good risk-reward trades if you look hard enough.

Thanks for the comments guys!
Zach
zachstocks.com