SpearFinance

Stair Stepping Lower

John — Tue, 10 Mar 2009 10:55:52 -0400

Friday, March 6, 2009

Kenneth Reid

Investors are concerned that the U.S. economy is headed to hell in a hand basket. Fears of a Second Great Depression abound and there is some evidence suggesting that things are actually headed that way despite Fed Chairman Bernanke’s stalwart commitment to not make the same mistakes that were made in the ‘30s. Full Article

Megaphone

Nathan Skinner — Mon, 14 Dec 2009 09:37:31 -0400

Monday, December 14, 2009

Kenneth Reid

The Dow was up another 64 points on Friday, which takes it within 45 points of a new yearly high. This is impressive, considering that the Dollar Index also advanced 0.6% that day. The decoupling of the Dow from the Dollar is a significant development. They have been trading in a closely correlated inverse relationship for months. Full Article

Buying Smart

John — Tue, 10 Mar 2009 11:13:52 -0400

Friday, February 27, 2009

Kenneth Reid

We have been very bearish (and right) on the market for quite a while now. This is not your ordinary bear market and the capitulatory process for equities is not complete. We advocate a very defensive posture for most individual investors. Even our Best 4 Quants Model Portfolio is down heavily so far this year. Full Article

Gloom and Doom: Part 13

John — Tue, 10 Mar 2009 11:34:46 -0400

Friday, February 20, 2009

Kenneth Reid

It gets worse before it gets better. The odds of moving from recession to depression are increasing. Wall Street's got it wrong, nationalization is the solution, not the problem, but they've also got it wrong that it will happen soon. Things will have to get worse first. Full Article

Apple Pie in the Sky

Nathan Skinner — Wed, 21 Oct 2009 09:44:19 -0400

Tuesday, October 20, 2009

Kenneth Reid

The bulls are getting giddy, which is the sentiment indicator we have been looking for as part of our topping scenario. On Monday the Dow rallied about 100 points even though it is quite overbought. In our technical section we pointed out the “speed zone” in this area months ago. We are experiencing the Speed Zone Effect now. Full Article

Another good week!

Gregory Spear — Thu, 16 Jul 2009 09:41:59 -0400

This week we are altering our Short-Term Model Portfolio formula somewhat. Given the momentum of this week's rally, instead of switching to the funds our system has selected for this week, we are holding last week's picks with a stop price on each fund. If stopped out, the table provides the symbol of the fund to buy with the proceeds. Full Article

Moment of Decision

Nathan Skinner — Wed, 21 Oct 2009 09:50:15 -0400

Wednesday, October 21, 2009

Kenneth Reid

Right now in the market, it is not about earnings reports, it is about market momentum. Full Article

Possible 'bearish wedge'

Nathan Skinner — Tue, 27 Oct 2009 09:36:21 -0400

Tuesday, October 27, 2009

Kenneth Reid

On Monday, the dollar finally rallied. A rising dollar is bad for equities, which is one reason the Dow was down 104 points. The greenback has been so badly kicked around that it really had no where to go but up. There has been so much gold-love and dollar bashing that someone had to call the cops on the monetary hoodlums. Full Article

gov etf chart

Nathan Skinner — Thu, 29 Oct 2009 11:15:56 -0400

Red Light Greenlight

Nathan Skinner — Mon, 02 Nov 2009 12:21:25 -0400

Monday, November 2, 2009

Kenneth Reid

The stock market is in the midst of its fourth correction since July. The pullback is inciting some bearish commentators to rant against the validity of the summer rally, as though it were somehow “wrong” and is finally showing its true colors. We dispute the possibility of the market ever being “wrong” and assert that value is always in the eye of the beholder.

David Einhorn of Greenlight Capital argues that paying attention to the ‘Big Picture’ is important when making investment decisions on individual equities. Einhorn is not particularly sanguine about the state of the U.S. financial system or its global counterparts, but the new Financial Stability Improvement Act of 2009 might cheer him up a bit. The bill would require Wall Street to take responsibility for cleaning up future messes.

Speaking of the big picture, pullbacks have been mild this summer, but with the market now near important resistance at Dow 10,000, we recommend selling some inventory into strength and weeding the portfolio garden. Moreover, as part of the new normal, we think the educational system in the U.S. will be restructured. Apollo Group (APOL) is an educational outfit that also has problems with the SEC. We are bearish on the sector and “unprofile” the company.

The Best 4 Quants Model Portfolio finished last week at -3.2% vs. the S&P's -0.7%. This week the Best 4 Quants Model Portfolio was in cash while the S&P has lost 1.9%. Since Inception 3/14/2003 the model has a return of +259.6% vs. the S&P 500’s +27.1%. The Best 4 Quants Model has no picks this week.

For those who do not follow the Best 4 Quants model portfolio, we offer our TSR Timing Model as general guidance on the relative safety of the current market. On 10/28/09 the timing model went from +200% to -25% invested. Take a 12.5% position in SDS, which doubles the inverse of the S&P 500. Full Article