Posts by Andrew Stotz
Warning: Dream Factor Riding High in US
Chart of the Day: Over 13 years Inflation contributed 32% of 171% market return. Book value growth contributed 33%. Dividends contributed 19%. The Dream Factor contributed 16%.
Read MoreUS Dream Factor Is High, Book Value Growth Is Low
Chart of the Day: Stock returns are driven by four main factors. US companies have had almost no growth in book value over the last three years. The “Dream Factor” has been rising as investors push up valuation.
Read MoreUS Dollar Rally Not Closely Tied to Interest Rates
Chart of the Day: US dollar rally in late 90s and early 2000s was not driven by rising rates. Recent dollar rally not interest rate driven. Dollar strength may be more driven by the risk levels in the rest of the world.
Read MoreWhat Type of Investor Are YOU?
Chart of the Day: Should you be buying stocks? Follow these questions to assess your situation.
Read MoreIf Risk Rises, Commodities Could Be an Alternative to Gold
Chart of the Day: If risk rises, a better alternative to gold could be commodities. Slowing economies, especially emerging markets, caused commodity price fall. Risk is that the whole world slows.
Read MoreGold Could Be an Alternative If Profits Fail to Rise and Inflation Heats Up
Chart of the Day: First risk is that US rates rise and Trump is unable to jump start corporate profits. Second is that inflation gets out of control causing Fed to raise more aggressively. If both happened, then gold could be attractive.
Read MoreMalaysia Not So Attractive, But Low Volatility
Chart of the Day: Malaysia appears to be a less attractive market these days. Low ROE of 9.7% and high PE of 16.3x. Growth forecasts are low. The good news, volatility is low.
Read MoreRising US Interest Rates Could Be Bad for Both Stocks and Bonds
Chart of the Day: For nearly 10 years bonds outperformed stocks; driven by steady fall in interest rates. Rising interest rates would be bad for both asset classes unless the Trump administration can jump start corporate profits.
Read MoreHigh PE Means That without Earnings Surge Market Rally Is at Risk
Chart of the Day: Rally was partially fueled by near-zero interest rates. Without a sustainable rise in profit margins US stock market rally could be finished.
Read MoreThird Stock Market Boom since 1994, Already Longest, about to Be Strongest
Chart of the Day: The US stock market is now up 215%. Of the last three stock market rallies, this is the longest at 97 months and it is about to be the highest.
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