A Melt Up In U.S. Equities

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Includes: IVE, NASDX, NDAQ, PFF, QQQ, SH, SPY, SPYD, SPYG, SPYV, SVXY, TVIX, UVXY, VIXH, VIXM, VIXY, VOO, VTI, VTSAX, VXX
by: Rigel Mercantile Limited
Summary

Low levels of VIX get all the attention; the often attributed reason is complacency, the often prescribed medicine is caution.

Equity risk premium relative to Aaa rated bonds and Baa rated bonds do not scream over valuation.

We are guilty of having thrown in the towel on this market too! It behooves us to consider this: What if we were wrong? What if equities melt up instead?

In the attached presentation, we present 21 charts that should make any one predicting doom and gloom on the US equity markets (SPY, SPYG, SPYV, SPYD, SH, VXX, SVXY, VOO, IVE, NDAQ, QQQ, NASDX, VXX, VIXY, VIXM, VIXH, TVIX, UVXY, VTI, PFF, VTSAX) reconsider their stance.

We too are guilty of having given up on this market way too prematurely but the breadth of the market, which got us bearish in the first place, is now showing signs of underlying strength and it behooves us to recognize it.

We hope you enjoy the charts, we look forward to your comments.

Disclaimer: Rigel Mercantile Limited specializes in Macro/Value Research and Systematic Trading. The views expressed above are our discretionary ideas that we have arrived at using discretionary analysis and, therefore, are limited to our discretionary portfolios only. Our systematic strategies may or may not have a position (long or short) in the securities mentioned above. Under no circumstances should the information contained herein be used or considered as an offer to sell, or a solicitation of an offer to purchase, any security or investment service. The information presented herein is presented in summary form and is, therefore, subject to qualification and further explanation.

Disclosure: I am/we are long US EQUITIES, VIX.

I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.