Upcoming Chapter Meeting: AAII Philadelphia

Posted on April 24, 2014 | Local Chapters


Date: Tuesday, April 29, 2014
Topic: Improve Your Investment Returns With Investor’s Business Daily
Speaker: Eddie Ramirez, Senior Product Trainer, Investor’s Business Daily

How can you pick the true leaders from the over 10,000 publicly traded stocks that you have to choose from? With more than four decades of research, Investor’s Business Daily’s founder, William J. O’Neil, developed a unique way to search for winning stocks. Eddie Ramirez will explain how IBD screens the market and helps you to identify leading stocks that could be gearing up for a big move. If you catch such stocks early enough, you should be able to capitalize on their enormous progress. Ramirez will also dive deeper into the question of when to sell a stock in order to protect your capital, how to construct a proper IBD stock watchlist, and explain IBD’s exchange-traded fund (ETF) strategy.

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Upcoming Chapter Meeting: AAII Austin

Posted on April 24, 2014 | Local Chapters


Date: Monday, April 28, 2014
Topic: Looking Ahead in an Uncertain World
Speaker: Fred Richards, President, Adrich Corporation

In this presentation, Fred Richards will examine the opportunities available to investors in 2014, as well as the pitfalls that might upset the economy. He will outline what industries should grow in 2014 and his domestic and international concerns going forward. Richards will also discuss the potential impact of the Federal Reserve’s decision to reduce quantitative easing and the effect of possible interest rate increases.

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Upcoming Chapter Meeting: AAII Chicago

Posted on April 24, 2014 | Local Chapters


Date: Saturday, April 26, 2014
Topic: Fear, Greed and the Emotional Battle for Your Investing Dollars
Speaker: Charles Munro, First Vice President, Investments, Stifel Nicolaus

Have you ever made a decision out of ego or peer pressure? Have you ever bought a hot stock right before it tumbled? Our speaker, Charles Munro, will examine how basic emotions clash with logic when dealing with investing our money. We will also learn how controlling these emotions can help increase investment returns.

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Upcoming Chapter Meeting: AAII Baton Rouge

Posted on April 24, 2014 | Local Chapters


Date: Saturday, April 26, 2014

Topic: Survey of the Economic and Investment Landscapes

Speaker: Don Lansing, Founder and Chief Investment Officer, MTA Capital and Lansing Investments

Don Lansing will provide a survey of the economic and investment landscape, discuss how to evaluate investment and trading strategies, and deliver alternative approaches to improving your risk-adjusted returns and generating income. He will touch on hedging your portfolio during periods of concern, the historical impact of rising interest rates on various investments, and review the hot and cold sectors of the market.

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AAII Sentiment Survey: Optimism Rebounds, But Remains below Average

Posted on April 24, 2014 | AAII Survey

Optimism among individual investors rebounded strongly, but still remains below average in the latest AAII Sentiment Survey. Neutral sentiment rose back above 39%, while pessimism fell below back below its historical average.

Bullish sentiment, expectations that stock prices will rise over the next six months, rebounded by 7.3 percentage points to 34.5%. This is the largest weekly change and the biggest increase in optimism since a 12.3 jump on February 13, 2014. Nonetheless, optimism is below its historical average of 39.0% for the sixth consecutive week.

Neutral sentiment, expectations that stock prices will stay essentially unchanged over the next six months, rose 0.9 percentage points to 39.5%. This is a four-week high. It also the 16th consecutive week neutral sentiment is above its historical average of 30.5%.

Bearish sentiment, expectations that stock prices will fall over the next six months, plunged 8.2 percentage points to 26.0%. This puts pessimism below its historical average of 30.5% for the first time in three weeks.

The current streak of below-average bullish sentiment readings is the longest since a six-week stretch between March 28 and May 2, 2013. Neutral sentiment is above its historical average for the longest consecutive period since a 24-week stretch between January 28, 1999 and July 8, 1999. Bearish sentiment has not been above average for three consecutive weeks since August 22 through September 5, 2013. This week’s drop in pessimism ended a two-week stretch of above-average readings.

Neutral sentiment is back to an unusually high level, or more than one standard deviation above its historical average. Though the S&P 500 has bounced back and now sits close to its record high, uncertainty remains about whether a short-term market top has formed. Valuations are also playing a role and some individual investors may be waiting to see how first-quarter earnings look. Keeping some individual investors optimistic is the market’s resilience, economic expansion, the Federal Reserve’s tapering of bond purchases and low interest rates. Keeping some individual investors pessimistic is the pace of revenue growth, the slow rate of economic expansion and Washington politics.

This week’s special question asked AAII members about their perception of the current state of the housing market. Responses were mixed, though 45% described the housing market as improving. About half of this group, or 21% of all respondents, said the recovery is slow or slowing. More than 7% of all respondents said the recovery is mixed with certain geographic areas or price segments doing better than others. Another approximate 7% described housing prices as being or getting expensive. Slightly less than 7% said the housing market was weak or weakening, while 6% described housing as stable.

Here is a sampling of the responses:

  • “Much improved, but a ways to go.”
  • “Housing prices are moving up and sales activity is increasing.”
  • “Slowly getting better, depending on the market location.”
  • “It’s bubbly in a few areas, but not nationally.”
  • “Sellers are inching up to prices they commanded years ago, but income has stagnated for many buyers. Not a great scenario.”

This week’s AAII Sentiment Survey results:

  • Bullish: 34.5%, up 7.3 percentage points
  • Neutral: 39.5%, up 0.9 percentage points
  • Bearish: 26.0%, down 8.2 percentage points

Historical averages:

  • Bullish: 39.0%
  • Neutral: 30.5%
  • Bearish: 30.5%

The AAII Sentiment Survey has been conducted weekly since July 1987 and asks AAII members whether they think stock prices will rise, remain essentially flat, or fall over the next six months. The survey period runs from Thursday (12:01 a.m.) to Wednesday (11:59 p.m.) The survey and its results are available online at: http://www.aaii.com/sentimentsurvey



Sell OF THE WEEK 4/23/2014

Posted on April 23, 2014 | Podcast

AAII Journal Editor Charles Rotblut explains to Chuck Jaffe of MarketWatch why Family Dollar Stores (FDO) is his “Sell of the Week” on the MoneyLife Radio Program. MoneyLife is a daily personal finance show that sorts through the financial clutter to bring you the information you need to lead the MoneyLife.

Audio url: Sell of the week





John Maynard Keynes as an Investor: Timeless Lessons and Principles

Posted on April 23, 2014 | AAII Journal

As an active investor, I am always searching for guideposts that would help me avoid the perennial mistakes most investors make.

How do I avoid buying at the top of a market or jumping out when my entire portfolio gets whacked? How do I keep the faith when there’s turmoil aplenty, as was the case in 2008? How important are dividends in a downturn?

In the portfolios of the great economist John Maynard Keynes, I found some answers and reinforcement. Like Keynes, I did nearly everything wrong for years until I discovered a durable path to investment success. I speculated in commodities, dove into individual stocks on a whim and held onto losers far too long.

I found solace, though, when I examined Keynes’ investments, which span two world wars. Even though I and millions of others have weathered brutal markets in this century, they had nothing on Keynes, who was investing money for King’s College (Cambridge University), two insurance companies and private accounts for himself and his famous Bloomsbury friends.

Although he’s better known for his sweeping—and controversial—economic theories, Keynes was a fervent practitioner of capitalism. His rousing success as an investor shows how he embraced markets nearly all of his life.

Viewing his record as an investor, it’s ludicrous to call Keynes a socialist, which he wasn’t. Keynes genuinely enjoyed being a speculator and investor. He called his favorite stocks his “pets.” In addition to thinking through the ideas that would rescue Western economies (as well as Japan and eventually China) after two devastating cataclysms, he managed money for his own portfolio, his friends and several institutions.

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BUY OF THE WEEK 4/22/2014

Posted on April 22, 2014 | Podcast

AAII Journal Editor Charles Rotblut explains to Chuck Jaffe of MarketWatch why Constellation Brands (STZ) is his “Buy of the Week” on the MoneyLife Radio Program. MoneyLife is a daily personal finance show that sorts through the financial clutter to bring you the information you need to lead the MoneyLife.

Audio url: Buy of the week




AAII WEEKLY FEATURES 4/22/2014

Posted on April 22, 2014 | Weekly Features

Investor-Update

This week’s AAII Weekly Features has been updated.
View this week’s Top AAII Articles, Featured Stock Screen and Member Question.

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AAII Sentiment Survey: Optimism Falls to Lowest Level in a Year

Posted on April 17, 2014 | AAII Survey

Optimism among individual investors is now at levels not seen in 12 months, according to the latest AAII Sentiment Survey. Neutral sentiment, meanwhile, is above average for the 15th consecutive week.

Bullish sentiment, expectations that stock prices will rise over the next six months, fell 1.3 percentage points to 27.2%. Optimism was last lower on April 18, 2013. Bullish sentiment is also now below its historical average of 39.0% for the fifth consecutive week.

Neutral sentiment, expectations that stock prices will stay essentially unchanged over the next six months, rebounded by 1.1 percentage points to 38.5%. This puts neutral sentiment above its historical average of 30.5% for the 15th consecutive week. The last time a similar streak occurred was in 1999.

Bearish sentiment, expectations that stock prices will fall over the next six months, edged up 0.1 percentage points to 34.3%. The modest increase puts pessimism at a 10-week high. It also puts bearish sentiment above its historical average of 30.5% on back-to-back weeks for the first time since January 30 and February 6, 2014.

Bullish sentiment is now at an unusually low level, or more than one standard deviation below its historical average. Historically, such readings have been a contrarian signal. Optimism can stay at below-average levels for a period of time, however. It is also important to realize that many AAII members are long-term investors and do not make portfolio decisions solely based on changes in their short-term expectations.

The drop in bullish sentiment comes as downward volatility has returned to the market. The recent decline in stock prices has heightened concerns that a market top has been formed and that valuations may have become too high. Also playing a role is the pace of revenue growth, the slow rate of economic expansion and Washington politics. Keeping some individual investors from being pessimistic is earnings growth, economic expansion, the Federal Reserve’s tapering of bond purchases and low interest rates.

This week’s special question asked AAII members what they think about the decline experienced by highly valued momentum stocks such as Netflix (NFLX) and Facebook (FB) since the start of March. About 60% of respondents said these stocks were overvalued and/or that they were not surprised to see the share prices fall. A small number of respondents (5%) thought the declines are a precursor to a further decline in the broad market indexes.

Here is a sampling of the responses:

  • “About time. They were way overpriced for their revenue models and long-term outlooks.”
  • “They were overvalued and are still overvalued!”
  • “They didn’t deserve their valuation and needed to be knocked down.”
  • “I am glad I did not buy into the hype or the noise.”

This week’s AAII Sentiment Survey results:

  • Bullish: 27.2%, down 1.3 percentage points
  • Neutral: 38.5%, up 1.1 percentage points
  • Bearish: 34.3%, up 0.1 percentage points

Historical averages:

  • Bullish: 39.0%
  • Neutral: 30.5%
  • Bearish: 30.5%

The AAII Sentiment Survey has been conducted weekly since July 1987 and asks AAII members whether they think stock prices will rise, remain essentially flat, or fall over the next six months. The survey period runs from Thursday (12:01 a.m.) to Wednesday (11:59 p.m.) The survey and its results are available online at: http://www.aaii.com/sentimentsurvey



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