The biggest money in investing comes from patience and time
Your biggest edge as an individual investor comes from ignoring short-term fluctuations and playing the long game. Source: Peter Mallouk, Charlie Bilello
The best performance stocks in the S&P 500 this year...
Source: Charlie Bilello
With “risk free” rates above 5%, the typically low-growth, high-dividend payers in the sp500 are massively underperforming in 2023
The 101 non-dividend payers are up 20.4% YTD, while the 100 highest yielders in the index are down an average of 3.5% on a total return basis. Source: Bespoke
From T.I.N.A (There is No Alternatives to risk assets) to T.A.R.A (There Are Reasonable Alternatives, i.e bonds)
Three years ago in August 2020, the S&P’s dividend yield (in red below) was 1.8%, almost 50 bps higher than the highest yield on the treasury curve. Every treasury note with a duration shorter than 5 years had a yield below 0.2% and the 1-month was almost ZERO. Fast forward to today and the S&P’s dividend yield of 1.55% is 260 bps lower than the lowest point on the treasury curve right now (the 10-year at 4.15%). And the 1-month T-bill yielding at 5.34% is 380 basis points higher than the S&P’s dividend yield. Source: Bespoke
Many are concerned that higher rates will hurt growth, but it turns out that a lot of S&P 500 companies have locked in debt at much lower rates until 2030
Source: Bloomberg, Goldman Sachs
Out of 20 valuation metrics, the SP500 is currently overvalued on 19 of them relative to historical levels
Source: Barchart
During stagflationary periods, the SP500 index tends to be inversely correlated with inflation
Tavi Costa: "From the late-1960s to the mid-1970s, equity markets declined whenever CPI rates re-accelerated to the upside. The primary driver behind this negative correlation stems from the market's growing concern about the potential for a tighter monetary policy to address the persistent increase in consumer prices". Source: Crescat Capital, Bloomberg
SP500 seasonality and 4-year cycle analysis suggests a consolidation before a year-end rally
Source: Nautilus Research
