Seeking Alpha by Adding Beta

Super Bowl of NFL is just a week away when Patriots would be appearing 9th time since 2001 and Rams will be playing their first since moving to City of Angels! Who would win? It's match up between experience vs youth. Patriots' quarterback Tom Brady (age 41) and head coach Bill Belichick (age 66) have been playing/coaching football before their respective counterparts Rams' quarterback Jared Goff (Age 24 - Cal graduate. Go Bears!) and head coach Sean McVay (Age 33) were even born! In a way it's representation of today's society including corporate world. When it comes to which team I support - I am split. I stayed in New England for one year so would like to see Patriots win. But then Rams is now California team with quarterback from UC Berkeley (my alma mater). So I am just going to enjoy the game and let the best team win! But before we get to Super Bowl Sunday, let's look at this week's Super Bowl of economic events starting with earnings. This week can...

About 15 months back, I wrote bog Four Horsemen of the Markets  about what could end the good times markets were having (back in 2017). Other than taxes, all other three (Fed, Earnings and Trump) played a role in market turmoil exactly one year later producing worst December since 1931. Looks like I was year earlier! Now that scenario has played out, let's look at antidotes for Four Horsemen of markets (for references to Four Horsemen, read on wikipedia and my blog) Markets have recovered half of their losses after reaching low on Christmas Eve and playing the theme of Markets take steps going up and take elevator coming down. Let's look at the antidotes which would keep markets chugging along potentially reaching all time highs in 2019 again! FED and Interest Rates:  Fed did act as horseman and played its role for Q4 turmoil by declaring its intentions of raising interest rates almost like autopilot. No one including President Trump liked it and Fed also realized that it...

You may have heard the terms "Third time is the Charm" or "Third time's lucky". All of these terms have some meaning. For example, "Third time's lucky" has its origin in 19th century hanging in which one would be freed up from hanging if he survives third attempt. So how does this relates to "Third Year is Best"? 2019 is third year of Presidential term and based on historic data,  this is the best year for markets. Since 1950, markets are up 100% of time in third year. On an average  they are up by close to 15%. Check out WSJ article on this! General theory is that first two years Presidents spend on fulfilling difficult campaign promises as done by Obama with Health-care reform law and Trump did with tax reforms. In third year, President gets into campaign mode in first term and "Leaving Legacy" mode in 2nd term and start focusing on economy. The major policy changes in first two years start playing out in third year. In addi...

Happy New Year to all. Finally 2018 is over and hopefully new year of 2019 would bring some much needed calm and sanity to the world of politics, economy and markets! 2018 ended as worst year for investing since great recession of 2008. While I have written about 2018 to be similar to 1998, it turned out to be worse than expected. Looking back at my recommendations at start of year, it turned out to be one of the worst year of recommendations. Let's take a look at it briefly. Overall returns were negative high double digit percentages (compared to negative 6.2% for S&P).  Only 6 out of 18 recommendations did better than market Best performers were NTNX, RGNX and QURE Worst performers were SN, NLNK and GE. The last one (GE) was real surprise. I never expected GE to be down by 57% in 2018. So overall it was quite dismal performance. It would have been better to just invest in S&P instead. But that was last year. The Q4 market turmoil has left many stocks at "di...