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Investors Are Over-Invested, Signaling Decline To Come

Jul. 23, 2013 9:44 PM ETUSL, SPY, QQQ, USO
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Seeking Alpha Analyst Since 2009

For the 15 years through 2012, Laurent has outperformed the market with 16% annual returns, compared to 5% for the market. Laurent's international career has stretched through US and Europe. He earned an MBA from Boston University and an MS in Engineering from RPI.

Stocks gained another fraction of 1% last week to another 52 week high. Oil & gas stocks led the charge with a 2.1% appreciation due to the rise in Brent prices. Tech shares fell 1.5%.

The Fed is continuing to inflate the bubble and presently, investors have greater than 130% of a standard deviation more than normal allocation in stocks. This is a level unseen since the crash. In fact, the last time that Americans have had over 28% of their assets in stocks was February 2002. At that time, the S&P 500 was at 3046, where it peaked. Over the next year, the market dropped 30% to 2192. So, I recommend a conservative portfolio.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

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