Partisan Conflict and Market Volatility

Even with last weekend’s government shutdown, no agreed-upon budget and yet another debt ceiling increase needed, the major U.S. indexes continued to set record highs. While Mr. Market’s ongoing calm mood may seem paradoxical given what’s happening inside of the Beltway, one study suggests it is normal for volatility to be low. The study’s authors…

 

Quality Can Help Put the Odds in Your Favor

Let’s start this week’s commentary with a hypothetical scenario: A person you trust says they have two stock picks for you. Both stocks are expected to rise in price. The charts for each stock are showing similar formations and the recent news seems equally positive. You only have enough available cash to buy one of…

 

Mr. Market Is Distorting Your Tolerance for Risk

When NPR’s update of the day’s headlines mentions the stock market’s lack of volatility, conditions must be extraordinarily calm. Such is the case right now. The Chicago Board Options Exchange’s Volatility Index (the CBOE’s VIX)—an obscure index to those who don’t focus on the financial markets—made the morning news. While most investors prefer calm conditions…

 

How AAII Builds and Presents Stock Screens

Year to date, the Oberweis Octagon screen leads all approaches tracked by AAII, up 42.9% through the end of July. Such a high return is very tempting when the market is up only 6.3% over the same period. But blindly chasing high returns without understanding the drivers and characteristics of a given approach is often…