Investor Points of Few – A Trump-Sized Market Hairball

By Alan Steel

The infographic above from our good friend Mike Williams shows that the market is about as popular right now as airport security.

And with rare exception over the last eight years, that consensus of stock market negativity amongst the investor herd hasn’t changed much.

What really makes me wonder is the date on the above chart: 17th May. That uber-low reading was taken last week before the major indexes went into spasm like a cat with a Trump-sized hairball. 

While volatility is relatively low, in the words of Mike Williams, investors are swinging at “fever pitches” just now – anything negative the media throws at them.


Back to that Market Hairball…

Despite last week’s stock market throat-clearing, it makes you seriously wonder how it’s possible to have a bullish reading of just 23% right now.

For perspective, back in March 2009, at the epicentre of the recession’s turn towards recovery, the level of bullish support was just under 20%.

Eight years later, and a continuous roll of record highs amongst the major indexes since late 2013, and we’ve basically only moved the sentiment sticks about 3%. 

Little wonder they’re calling this “the most hated bull market in history.”

But all that hate isn’t getting anyone any closer to reaping the returns they’ve been missing out on.


You Just Couldn’t Make It Up

And then you see something like this from a scribbler at a New York daily newspaper over the weekend who writes, “There’s never a good time to invest in the stock market.”

Hmmm…I’ve never understood why Regulators, like the FCA here in the UK, don’t trounce on these folks for scaring investors senseless and then doling out bad advice.

We know that that the markets are bullish and rising far more often than they’re bearish. It’s a fact. 


The Evidence Remains Bullish

And right now, pre-eminent research houses like Ned Davis and Pring Turner are suggesting that this fear is an opportunity, and the indicator evidence remains bullish.

Ned Davis is also suggesting greater equity asset allocations for Europe and Mexico and, despite all the media noise, that China is not something we should be freaking out about.

So don’t get caught up in the short-term market hiccups and fevers that will always come and go, particularly if you’re investment view is long-term.

And go find someone with a long track record of success (and not a celebrity doom-and-gloom town crier for Armageddon) to keep you sane while everyone else is running for the exits.

You’ll probably be very glad you did.

Because after all, it’s your money we’re talking about here.

Alan Steel, Chairman, Alan Steel Asset Management



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