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Fidelity: Looking For Signs Of A Turnaround

TedTed
in Off-Topic
FYI: What has been driving volatility in the markets? My thesis is pretty straightforward: The world’s two largest economies, the U.S. and China, are tied together via a quasi-fixed currency, and now find themselves on opposite ends of the monetary policy spectrum. That creates a liquidity strain that we are seeing unfold before our very eyes and is at the heart of what’s plaguing the markets today. But when these policies are no longer in conflict, it could set up a powerful reversal in performance for some of the most beaten-down parts of the market—commodities, high yield, and emerging market stocks.
Regards,
Ted
https://www.fidelity.com/viewpoints/market-and-economic-insights/turnaround-signs

Comments

  • PRESSmUPPRESSmUP
    Hi Ted...thanks for the link. This is a good synopsis as to where we are, IMHO.

    Not surprisingly, it looks like the end of last week may have been a head-fake. As I have the bulk of my 401k transfer still sitting in cash, I'm looking for what looks to be something resembling a bottom to deploy about 80% of this. I'd be ok with being early, by a bit.

    Haven't seen anything to this point which would make me think it's time to pull the trigger though.

    press
  • davidrmorandavidrmoran
    Boy, for retirement moneys, assuming a few years' horizon, I would always think the best time is right now. (Not that you asked for advice :) )
  • JunksterJunkster
    The open end junk bond funds were up today in spite of the plunge in oil and the decline in equities. Nice positive divergence so let's see if it holds. Sentiment can't get much worse.
  • PRESSmUPPRESSmUP
    It's not like I'm all cash...I have 35% in equities from prior account activity. But for this transfer, I'm considering the fact I already have a plus 20% or so equity gain based on my sitting on my hands since the middle of last year.

    So, as I said...early is okay, but not quite yet.

  • Dex
    I think the world is out of step and there isn't much that can be done about it.
    Europe is in terrible shape.
    China is slowing.
    The USA? Entering a slowdown? Oil looks to be saying yes - but there is that supply issue - OPEC, Fracking, Iran are all putting oil on the market.

    I think the world is in for a slow growth period that could last longer than anyone would be willing to speculate about for fear of being called a chicken little. However, I think there are trends happening that are there to make it so, population grown, robots, artificial intelligence, easy movement of capital and jobs to cheaper locations.

    So, look to buy anything that pays a dividend!
  • franktrdr
    Junkster said:

    The open end junk bond funds were up today in spite of the plunge in oil and the decline in equities. Nice positive divergence so let's see if it holds. Sentiment can't get much worse.

    Meanwhile, the JNK and HYG ETFs were down .85% and .99% respectively. I wonder if these down figures will show up in the open ends tomorrow.
  • JunksterJunkster
    edited January 2016
    franktrdr said:

    Junkster said:

    The open end junk bond funds were up today in spite of the plunge in oil and the decline in equities. Nice positive divergence so let's see if it holds. Sentiment can't get much worse.

    Meanwhile, the JNK and HYG ETFs were down .85% and .99% respectively. I wonder if these down figures will show up in the open ends tomorrow.
    But the ETFs were still above their previous day's NAV. They had a big run the last hour on Friday and were just working that off. The previous day's NAV is the key in evaluating the ETFs and the cash market and hence how the open end may be priced, albeit a very inexact science. I hope I can post in a week or so how junk bonds are up for the year. It wouldn't take a whole lot to get them positive.

    Edit Are you sure they were down that much? I was out the last five minutes of trading and watched them much of the day but didn't think they were down by that much.

  • Sven
    @Dex,

    look to buy anything that pays a dividend! That is a few viable vehicle today. If you have a longer horizon, Europe is several years away from full recovery and the low expection may prove to be decent entry points.
  • Old_Skeet
    Hi @Junkster,

    According to a recent Instant Xray analysis I have a good bit of junk bonds in my portfolio as a good number of my hybrid funds presently have a high allocation to junk bonds. I'd be interested in reading a weekly recap of your perspectives on Junk bonds. Not that I can lighten up a lot as I only have one fund classified as high yield and that is LBNDX.
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