Search Results for: equity

50 Percent of US Stock Fund Assets Are Invested in Index Funds Until active equity funds drop fees, the flow into passive equity funds will certainly continue. But could markets become inefficient if everyone buys index funds? Image: Morningstar

Investor Movement Index vs. S&P 500 The Investor Movement Index indicates the sentiment of TD Ameritrade retail investors. Thus, retail investors are net buyers of equities when the stock market is expensive, and they are net sellers of equities when the stock market is cheap. As usual, retail investors react to equity price movements. They buy and sell…

Why Are U.S. Banks Healthier Than Ever? U.S. banks are much stronger than ever. They have more capital and should withstand the next recession. See Fed’s annual stress test (Dodd-Frank Act Stress Tests): “The capital levels of the firms after the hypothetical severe global recession are higher than the actual capital levels of large banks…

Why Lower Bond Yields Influence the S&P 500? Because lower interest rates push stock market multiples higher.  If interest rates are lower, then the value of future cash flows increases, because future cash flows are discounted back at a lower interest rate. So, lower U.S. 10-year yields influence the stock market equity risk premium. On the other…

Over The Last 6 Months, The S&P 500 Lags Bonds, Gold And Global Stocks Last year, the sell-off of stocks was a correction from a bad equity risk premium and an overvalued stock market, as suggested by our forecasting models. Image: Bloomberg

Why Warren Buffett says that stocks are generally better than bonds? Our equity risk premium model shows when the US stock market return for the next 10 years is more or less attractive than the 10-Year Treasury Note. Since 1970, the 10-year Treasury Note was less attractive than the US stock market over a 10-year…

Markets aren’t as bullish as people believe: Expert Thomas Lee, former J.P. Morgan chief U.S. equity strategist, is a Managing Partner and the Head of Research at Fundstrat Global Advisors. He speaks about the current economic cycle and his view of the US stock market. https://www.youtube.com/watch?v=0S2tdAPaEDk

Aswath Damodaran – Laws of Valuation: Revealing the Myths and Misconceptions Aswath Damodaran is professor of corporate finance at the Stern School of Business at New York University, with his unique perspective about equity valuation. Here, he talks about the corporate life cycle, corporate finance, cash flow and the laws of valuation. https://www.youtube.com/watch?v=c20_S-QgvsA