Archive for 2017

Weekly Market Recap Dec 31, 2017

Courtesy of Blain.

StockTrader New Year’s Eve Edition!

Despite a hiccup on the last day of the year, indexes finished off a fantastic year in fine fashion with the S&P 500 surging 19.6% and the NASDAQ 28.4%!!  Keep in mind that is off a strong rally in November/December 2016 post election day.   Volume was extremely light as is usual for the week between Christmas and New Years Eve.   More crazy records being broke – it was the DJIA 9th positive month in a row – the first time that has happened since 1959.  The NASDAQ rose for the 6th straight year  – which last happened in 1975 to 1980.

“There’s not much happening, but the quiet action tells a really important story: it tells you the bulls remain in control, that sellers are few and far between, and that we’re waiting for the next big catalyst, which will probably be earnings,” said Adam Sarhan, chief executive of 50 Park Investments.

“Otherwise, we’re seeing the market digest a very strong 2017 rally. It is perfectly normal and healthy to see the market pause after a huge rally, and the absence of selling in and of itself is very healthy,” he said.

Selling late in the day Friday came in the last half-hour of trading, a fall that roughly corresponded with the publication of a Reuters report that Russian tankers had supplied fuel to North Korea in recent months.

Bitcoin fell nearly 10% Thursday after South Korea announced tougher measures to crack down on cryptocurrency trading.  That said, 10% is basically a daily move for this type of stuff!

Here are the best performers in the S&P 500 for 2017.  Align Technology is the maker of Invisalign dental braces.  Note the 2 home builders and chip makers.

Nothing market moving economically.

Here is the 5 day weekly “intraday” chart of the S&P 500 …via Jill Mislinski.

Interesting infographic on companies making the most profit PER employee
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Bill Gates vs Steve Jobs

By VWArticles. Originally published at ValueWalk.

The Wealth Acquirer

Published on Dec 24, 2017

Watch Bill Gates and Steve Jobs share the stage in this rare appearance together!

Also see Full Bill Gates book list

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Correcting For Selection Bias, Backtest Overfitting, And Non-Normality – II Journals

By VW Staff. Originally published at ValueWalk.

Marcos Lopez de Prado of Guggenheim Partners expands on his thoughts about the deflated Sharpe Ratio as published in his JPM 40th Anniversary issue article.

Correcting For Selection Bias, Backtest Overfitting, And Non-Normality

Marcos Lopez de Prado

Image source: YouTube Video Screenshot

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Vintage Warren Buffett, John Templeton & Robert Wilson Discussing Investment Principles (1985)

By VW Staff. Originally published at ValueWalk.

Interviews with legendary investors Warren Buffett, John Templeton and Robert Wilson. In the interviews, the gentleman explain their investment principles and how they view the stock market. They also discuss what makes them different and why they can beat the market.

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Vintage Warren Buffett, John Templeton & Robert Wilson Discussing Investment Principles (1985)

American-born British investor, fund manager, philanthropist, valuewalk, Templeton Growth Fund, greatest stock picker ever, John Marks Templeton, Chartered Financial Analyst, CFA, Time magazine's 100 Most Influential People, value investors, famous value managers, global value, Investing the Templeton Way: The Market Beating Strategies of Value Investings Legendary Bargain, Franklin Templeton Investments, Contrarian investing, legendary investor, "avoiding the herd", "buy when there's blood in the streets", Templeton Prize

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Elon Musk – 8 Keys To Success

By VWArticles. Originally published at ValueWalk.

Please write out your own interpretation of Elon Musk’s Keys To Success in the comment section! (generic answers given at the end of the video) Elon Musk

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Tesla Model 3 Launch Event Eight Ideas That Led To His Successes in Business: 1 0:00 – a lot of it is execution (and Hard Work) 0:20 – but also take feedback and try to improve 2 1:03 innovation comes from questioning the way things have been done before 1:18 try to get your customers to help you 3 2:56 get profits (Interesting Advice coming from Elon Musk) 4 3:58 substance over show 5 4:21 be good with the details 6 5:35 first principles thinking 7 6:39 try to be practical 8:54 having a purpose does make easier to attract talent 8 10:00 finding the leverage

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The China Hustle – Official Trailer

By VW Staff. Originally published at ValueWalk.

From the producers of ENRON: THE SMARTEST GUYS IN THE ROOM comes a Wall Street heist story about a still-unfolding financial crime so big, it has the power to affect all of our wallets. Investors on the fringes of the financial world feverishly seek new alternatives for high-return investments in the global markets, and have found a goldmine in China. But when one investor discovers a massive web of fraud, everything else is called into question. Jed Rothstein’s documentary rings the alarm on the need for transparency in an increasingly deregulated financial world by following those working to uncover the biggest heist you’ve never heard of.

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The China Hustle – Official Trailer

China Hustle

Image source: YouTube Video Screenshot

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Getting People To Agree: A TED Experiment

By Guest Post. Originally published at ValueWalk.

In April Mariano Sigman and I (mostly Mariano) carried out an experiment at TED on how to get people to make better decisions and to agree!  Here is the video and the writeup describing this and other experiments on the topic of how to get people to agree on difficult questions.  An important challenge these days…..

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The video:

And the ideas piece:

How Can We Improve Democracy? One Intriguing Idea: Set Up A Jury System.

Collective wisdom might best be found when small groups of people are given a chance to discuss and deliberate, say social scientists Mariano Sigman, Joaquin Navajas, Gerry Garbulsky and Dan Ariely. Could this suggest a better way to vote?

For many years, problems with democracy have been pushed under the carpet in the general belief that “democracy is the worst form of government — except for all the others.” While people have felt unhappy with the results after certain elections, their unhappiness didn’t cause them to question the entire system.

However, after surprising results like the EU referendum in the UK (aka Brexit), the 2016 US presidential election, or the 2016 peace referendum in Colombia, this feeling has changed. We’ve seen that democratic decisions are more volatile and less predictable than what common sense and forecasting technologies were ready to accept. In fact, it might be time to refine and revise what we mean by democracy and how it should be implemented.

While science cannot establish the goals of democracy, carefully designed scientific experiments can — and should — help identify the best ways to achieve them after they’re agreed upon by a society. For centuries, sociologists, political scientists, mathematicians…
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Michael Mauboussin Discusses The Paradox Of Skill

By VW Staff. Originally published at ValueWalk.

Michael Mauboussin, Director of Research at BlueMountain Capital Management discusses a framework to think about skilled active managers.

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Michael Mauboussin Discusses The Paradox Of Skill

michael mauboussin, Credit Suisse, valuation and portfolio positioning, capital markets theory, competitive strategy analysis, decision making, skill versus luck, value investing, Legg Mason, The Success Equation, Think Twice: Harnessing the Power of Counterintuition, analysts, behavioral finance, More Than You Know: Finding Financial Wisdom in Unconventional Places, academics , valuewalk

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Walter Schloss Book List

By Jacob Wolinsky. Originally published at ValueWalk.

Walter Schloss is one of the greatest value investors ever. Schloss had a career which spanned many decades from the early times of Ben Graham to the 2000s. Unforunately, Schloss never wrote any books nor are there many recommendations from the famed value investors. However, we were able to find a few books he recommended and one about Schloss which mostly come from a great talk which he gave at the Ivey School of Business in 2008. If you have any others please send us

See the six books below

Also check out our full investor list of books here


Book Name Author Publish Date Date recommended Source
value investing from graham Bruce C. N. Greenwald & Judd Kahn & Paul D. Sonkin & Michael van Biema 2004 2004 Investors Archive
The Memoirs of Walter J. Schloss Walter J. Schloss 2003 2003 Investors Archive
A Modern Approach to Graham and Dodd Investing Thomas P. Au 2004 2004 Investors Archive
The Intelligent Investor 3rd edition Ben Graham 1965 2008 Ivey Interview
Perkins The Internet Bubble Michael and Anthony Perkins 1999 2008 Ivey Interview
Security Analysis Graham & Dodd 1940 2008 Ivey Interview

An excerpt from the Ivey interview where Schloss discusses his time as a soldier in World War II

Well, I like to buy stocks that are hitting new lows. I like to look at the stocks, I

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“Q1 Stock Market Outlook: We’re Gonna Need a Bigger Slide”


"Q1 Stock Market Outlook: We’re Gonna Need a Bigger Slide"

Courtesy of Zero Hedge

by FFWiley

If 2018 rings in a bear market, it could look something like the Kennedy Slide of 1962.

That was my conclusion in “Riding the Slide,” published in early September, where I showed that the Kennedy Slide was unique among bear markets of the last eighty years. It was the only bear that wasn’t obviously provoked by rising inflation, tightening monetary policy, deteriorating credit markets or, less commonly, world war or depression.

Moreover, market conditions leading up to the Slide should be familiar—they’re not too far from market conditions since Donald Trump won the 2016 presidential election. In the first year after Kennedy’s election, as in the first year after Trump’s election, inflation seemed under control, interest rates were low, credit spreads were tight, and the economy was growing. And, in both cases, the stock market was booming.

Here’s an updated look at Trump’s stock rally versus the Kennedy rally and subsequent Slide:

As you can see, we’ve now reached the chart’s critical juncture—at this time of the calendar in 1962, the post-election rally was ending, and the Slide was about to begin. Our chart begs the question: Will the similarities continue and lead us into a Trump Slide in early 2018?

Or, with less drama, you might like to hear my Q1 stock market outlook.

While it’s certainly possible Trump’s rally has run its course, I’ll argue that it’s unlikely. And to make my case, I’ll rely largely on a single indicator, one that measures monetary policy. I use the indicator to help determine whether policy is behind the curve, ahead of the curve, or somewhere in between. In this article, I’ll call it VCURVE, for “versus the curve.”

Tracking VCURVE through 16 Market Corrections

Before I explain how VCURVE is calculated, let’s look at the history. The following chart compares VCURVE to every instance since 1954 when the stock market corrected by more than 10% and for at least two months:

The upper panel shows an especially…
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Zero Hedge

Enemy Of The People?

Courtesy of ZeroHedge. View original post here.

Via The Zman blog,

There has never been a time when normal people did not know the media was biased and biased in a predictable direction. For every non-liberal in the media, there were at least ten liberals. The ratio was probably higher, but then, as now, some lefties liked to pretend they were independents or some third option.

The media used to invest a lot of time denying they had a bias and an agenda, but the only people who believed them were on the Left, which had the odd effect of confirming they had a bias and an agenda.


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Phil's Favorites

A 2019 Earnings Recession?


A 2019 Earnings Recession?

Courtesy of 

Shout to Leigh!

On the new Talk Your Book – Josh Brown is joined by Leigh Drogen of Estimize, one of the leading providers of crowdsourced financial and economic data to talk about the trend in corporate profits that could potentially lead to an earnings recession later this year.

What is the thing that Leigh is seeing in the data that Wall Street isn’t yet picking up on? What segment of the stock market is most at risk? Why is the crowd smarter than the narrow consensus of Wall Street analysts?

Check out Estimize ...

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D.E. Shaw Investment Calls For Leadership Change At EQT

By ActivistInsight. Originally published at ValueWalk.

Elliott Management has offered to acquire QEP Resources for approximately $2.1 billion, contending the oil and gas explorer’s turnaround efforts have done little to lift the company’s share price. The company responded and said that a thorough review of the proposition is imperative in order to properly act in the best interests of shareholders, “taking into account the company’s other alternatives and current market conditions.” The news came only a month after Travelport Worldwide agreed to sell itself to Siris Capital Group and Elliott’s private equity arm Evergreen Coast Capital for $4.4 billion in cash and two months after Athenahealth was bought by Veritas and Evergreen for $5.7 bi...

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Kimble Charting Solutions

Gold & Silver Testing Important Breakout Levels!

Courtesy of Chris Kimble.

Gold and Silver from a long-term perspective have created a series of lower highs over the past 8-years. Will 2019 bring a change to this trend? A big test is in play!

Gold since the lows in 2016 has created a series of higher lows, while Silver may have created a double bottom.

Gold & Silver are currently facing break attempts a (1) and (2). These falling resistance lines have disappointed metals bulls for the past few years.

The direction of Gold and Silver weeks and months from now should be highly influenced by what each does as they are attempting to break above important resistance levels.

To become a member of Kimbl...

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Insider Scoop

UBS Says Disney's Streaming Ambition Gives It A 'New Hope'

Courtesy of Benzinga.

Related DIS Despite Some Risks, Analysts Still Expecting Double Digit Growth From Communications Services In Q4 ... more from Insider

Digital Currencies

Russia Prepares To Buy Up To $10 Billion In Bitcoin To Evade US Sanctions

Courtesy of Zero Hedge

While the market has been increasingly focused on the rising headwinds in the global economy in general, and China's economic slowdown in particular, while the media is obsessing over daily revelations that Trump may or may not have colluded with Russia to get elected, a far more critical, if underreported, shift has been taking place over the past year.

As we reported in June, whether due to concerns over draconian western sanctions and asset confiscations following the poisoning of former Russian military officer Sergei Skripal, or simply because it wanted to diversify away from the dollar, Russia liquidated virtually all of its Treasury holdings in the late spri...

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Chart School

Weekly Market Recap Jan 13, 2019

Courtesy of Blain.

In last week’s recap we asked:  “Has the Fed solved all the market’s problems in 1 speech?”

Thus far the market says yes!  As Guns n Roses preached – all we need is a little “patience”.  Four up days followed by a nominal down day Friday had the market following it’s normal pattern the past nearly 30 years – jumping whenever the Federal Reserve hints (or essentially says outright) it is here for the markets.   And in case you missed it the prior Friday, Chairman Powell came back out Thursday to reiterate the news – so…so… so… patient!

Fed Chairman Jerome Powell reinforced that message Thursday during a discussion at the Economic Club of Washington where he said that the central bank will be “fle...

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Members' Corner

Why Trump Can't Learn


Bill Eddy (lawyer, therapist, author) predicted Trump's failure based on his personality, which was evident years ago. This article, written in 2017, references a prescient article Bill wrote before Trump became president, in July, 2016, 5 Reasons Trump Can’t Learn. ~ Ilene 

Why Trump Can’t Learn

Donald Trump by Gage Skidmore (...

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Opening Pandora's Box: Gene editing and its consequences

Reminder: We are available to chat with Members, comments are found below each post.


Opening Pandora's Box: Gene editing and its consequences

Bacteriophage viruses infecting bacterial cells , Bacterial viruses. from

Courtesy of John Bergeron, McGill University

Today, the scientific community is aghast at the prospect of gene editing to create “designer” humans. Gene editing may be of greater consequence than climate change, or even the consequences of unleashing the energy of the atom.


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Mapping The Market

Trump: "I Won't Be Here" When It Blows Up

By Jean-Luc

Maybe we should simply try him for treason right now:

Trump on Coming Debt Crisis: ‘I Won’t Be Here’ When It Blows Up

The president thinks the balancing of the nation’s books is going to, ultimately, be a future president’s problem.

By Asawin Suebsaeng and Lachlan Markay, Daily Beast

The friction came to a head in early 2017 when senior officials offered Trump charts and graphics laying out the numbers and showing a “hockey stick” spike in the nationa...

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Swing trading portfolio - week of September 11th, 2017

Reminder: OpTrader is available to chat with Members, comments are found below each post.


This post is for all our live virtual trade ideas and daily comments. Please click on "comments" below to follow our live discussion. All of our current  trades are listed in the spreadsheet below, with entry price (1/2 in and All in), and exit prices (1/3 out, 2/3 out, and All out).

We also indicate our stop, which is most of the time the "5 day moving average". All trades, unless indicated, are front-month ATM options. 

Please feel free to participate in the discussion and ask any questions you might have about this virtual portfolio, by clicking on the "comments" link right below.

To learn more about the swing trading virtual portfolio (strategy, performance, FAQ, etc.), please click here ...

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Free eBook - "My Top Strategies for 2017"



Here's a free ebook for you to check out! 

Phil has a chapter in a newly-released eBook that we think you’ll enjoy.

In My Top Strategies for 2017, Phil's chapter is Secret Santa’s Inflation Hedges for 2017.

This chapter isn’t about risk or leverage. Phil present a few smart, practical ideas you can use as a hedge against inflation as well as hedging strategies designed to assist you in staying ahead of the markets.

Some other great content in this free eBook includes:


·       How 2017 Will Affect Oil, the US Dollar and the European Union


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About Phil:

Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...

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About Ilene:

Ilene is editor and affiliate program coordinator for PSW. She manages the site market shadows, archives, more. Contact Ilene to learn about our affiliate and content sharing programs.

Market Shadows >>