An excellent presentation. Your analysis and rationale of the S&P level and its likely future levels were particularly insightful. It would not surprise me if companies such as Microsoft and Google become valued at some point at 33x 2021 earnings simply because of their balance sheets, dominance of their sectors, their cashflows and the realisation that a 3% yield on their stock is better than zero on long term treasuries.
Thanks for your prospective on these events, Mark. I hope you continue making videos like this because a lot of us value your opinion on financial markets and the economy.
great analysis, took my 3k loss on one contract by selling @ 20 dollars a barrel. Knew it was going to drop after reading an article about hedge funds reprogramming their algos to trade futures negative. Saved me 57000 in potential loss. Sometimes you gotta take it on the chin.
I remember the day March 20, 2020 I informed my clients to keep buying high quality oil companies for long term as never in the history oil gone negative.
And here I am almost a year later watching while reviewing for my cfa exam thinking... WOW who would have thought back then that WTI would be at 60, 11 months later?
Just watched the complete Video ...... Wish there was a super like button on here ...... Great work Sir :) I'm definitely considering to buy the US oil ETF !
FMCG Sector in India is I think a beautiful example of "no where else to go" I bought companies such Nestle India and Dmart they trade at 80 to 100 PE . At that point I thought that the companies were overvalued but the valuation seems to be just exploding over the years because there are no other good companies and the money is simply being diverted to stocks of great companies. Can you believe a 100PE multiple is a new normal. I generated 35% returns over last 6 months.
@@MarkMeldrumdo you believe there could be a big pullback caused by the huge levels of debt we're in? By big I meant bigger than you say in the video. If we consider the long term debt theory over the ~20-year cycles, we should be up for a bigger correction than the one caused by COVID-19
Thank you Mark. It is always so insightful to get your analysis on the market. Please keep up the great work. I have written a master’s thesis on the three goals of the FED. It is not a common belief among the academics that the FED supports asset prices, however i was able to conclude that there is a relationship between low asset prices and FED policy rate. Inspired to hear from you that you share a common analogy. As for the oil, I am hoping/believing that oil supply will level the demand and prices will at least reach 30-40 a barrel within a year or two. However, can USO or Barclays ishares ETN go out of business before that? If so would the investors lose all their investments?
Hi Mark, I might be confused on your last remark on historical P/E values. So I wish to clarify. It's shown in the chart in the link below that the average P/E range was between 8 to >20 in the 1930s. And during 1950-1960s it ranged between 7 to >20. The P/E only seemed to edge upwards approaching the end of 20th century. I'm not sure what I'm understanding wrongly when you state that P/Es of 3-4 were the norm during 1930s and 8-10 were the norm during 1950s. If you would be so kind as to explain. Cheers! www.macrotrends.net/2577/sp-500-pe-ratio-price-to-earnings-chart
I agree with a lot of what you said, except I don't think you're considering the algos programmed for certain levels. I try to take these into consideration when buying and selling. The algos are driving close to 60% of this volatility. I'd love to hear your thoughts on it. It's not human traders sitting behind a desk buying and selling 100s of millions of shares an hour. Because of the machines, I expect this volatility to last for a while.
Hi Mark, quick question, the cost of storage in the forward/future formula is expressed as a ‘rate’ (%). What is it a % of in real world terms? I understand that cost of storage as an absolute value (cost of a tanker), but don’t understand how it works in theory.
If a contract for 1,000 barrels has a value of $20,000 and storage for 1000 barrels for one month will be $5/barrel, then on pick-up, you would owe $25,000. LN(25,000/20,000) will give you a continuously compounded rate for one month.
Great content! Thanks for sharing your thoughts! I have a question regarding forward P/E ratios - do those take into account at all any potential changes in corporate taxes?
Great video Mark - really, the most value added videos are yours. Whats the likelihood that big investors change up their IPS to include high yield bonds etc? That would considerably reduce the strength of your argument wouldnt it? Also I really find it difficult to value SP off of 18x earnings. I think 15-16 is more reasonable considering the ten year average, would you agree? Although at this point probably semantics
Hey Mark, But one question though if the pandemic hits harder will that not lead to new lows? And nobody can certainly tell the probability of that happening or not.
That is the risk of playing this game. At any time, no matter what is going on, there is risk. Always risk. So investing is risk management first. If you can’t get comfortable with risk, there is always accounting as a career.
USO is literally a futures contract.... as you said. That is the last place you should be putting your money if you want to bet on oil. ENERGY is where you want to be. invest in the producers. generational buying opportunities in the next 6 months...
Ilie Negura I think he is mostly referring to the institutional investors in his analysis of the market, and gold is a very speculative investment for these institutions to make. These institutions have to follow investment guidelines and manage their risk exposure, and I bet that most of their investment guidelines wouldn’t let them invest much of their portfolios in gold. The price of gold is 100% speculative and it doesn’t have any intrinsic value (meaning it doesn’t provide any potential for cash flows or earnings growth). From what I’ve read, the only time gold is an appropriate investment is to protect against hyperinflation. Unless you’re predicting a doomsday scenario where there is hyperinflation, gold is much too volatile and it doesn’t provide any returns, so the majority of investors wouldn’t fill their portfolios with it :)
Hi Mark, wouldn't the ETFs just have splits / consolidations, much like the leveraged ETF TVIX (VIX futures) contracts, that had to deal with heavy contago, you can see in the time series. I think ETNs can have a different structure again, as the collateral is written by a large bank like Barclays, the price can be synthetic? I'm not 100% on these concepts but this is my 2 cents
@@MarkMeldrum Appears IB has settled up with the clearinghouses , but probably chasing customers over the losses? www.businesswire.com/news/home/20200421005853/en/Interactive-Brokers-Issues-Statement-Crude-Oil-Contracts
Hello Mark, thanks a lot for your precious efforts I am a level one candidate and I quite understand derivatives of level one but I have some issues beyond the scope of the material in level one that confuse me so I hope you correct my guesses if I am wrong: say that I entered a long position for future contract with a settlement price equal for example 100 and as I know the contract trades at the exchange at initiation at a 100 and then strats to fluctuate over the the term of the contract and let say at a given point of time the contract value declines to 90 and I've decided to close the position before expiration and sell the contract and accept the 90!! So how the exchange close my position and what would be the cash changes in my account as a result?!!! I have a guess and I hope you correct it If I'm wrong: Is means the exchange would clear the difference between the value of contract at initiation and the price I accept to sell the contract for which means the exchange would withdraw 10 from my account. While the person (Mr X) who take the position from me would beer the obligation towards the the short party, and let say that Mr X hold the position for expiration to have the settlement! Now what is the case how the short party get the settlement price of 100?!! Should Mr X just pay the 90 while the exchange afford the difference of the (10)?!
On the whole, very informative vid Mark. Just wanted to point out that what you said related to PE ratios greatly increasing over the past 80 or so years is not necessarily accurate when talking about the SP (www.multpl.com/s-p-500-pe-ratio/table/by-year). Although it does seem the ratios became very high coming out of other downturns such as the dotcom crash and the 08 real estate crisis, likely for a lot of the reasons you mention. If PE ratios were to increase dramatically over time in this linear fashion as suggested, then the lower yield of equities would likely decrease the attractiveness of the asset class relative to others and a shift in SAA for these institutions and funds would likely take place. Whether that be towards holding more lower yield but less risky investments, or towards greater tolerance for higher yield and riskier asset classes.
Mark, wouldn't you be purchasing the option contract at the ask price ($16.30) and not the bid price ($16.71)? In other words, you would be receiving $16,300 for purchasing the contract.
Dr Mark, great video and extremely valuable insights as always. Just a quick comment concerning " Where else to go" at my level as a very small investor, with a lot of uncertainty in the market now I would personally "out of fear" avoid equities (I was considering shortening the market, but after your video not anymore :) I was considering alternative investments, real estate for instance, or commodities, with that said, if institutional investors would seek same path, and private equity option is in their range of sight, then the equity market might as well drop substantially. I believe human nature (fear and herding effect) will dictate where we go from here. do you think I make any sense ?
Hi Mark. A question. Considering the major demand reduction due to global lockdowns, many people expected and were aware of the oversupply of crude in the market. What I'm a little confused about is why they waited till the very last day to exit their positions/cancel contracts. Why do you think this happened?
"No where else to go." Is real estate a good place to go? Seems a residential rental is a place that continues to produce cash flow, people must have a place to live...buy in a manufacturing area, below the median, get affordable single family homes at average prices and rent those homes for a 5-7% ROI...seems a great place to store your treasure. Let me know your thoughts?
Hi Dr. Mark, what are you using as the spot price for crude oil in calculating the future price. I tried finding the sport price of crude oil but was unable to find it. Everywhere I search, I only get futures contract price.
I am someone who has been studying stocks for a couple of months and don't pretend to be an expert, but looking at the S&P500 the index is havily concentraded on GAFAM and the recovery was just too quicky, but considering that the fundamentals of most of the companys are far worst than they were 3 months ago, how can it be that the S&P is so high so fast? I'm just saying that in fact there's a bubble but the big tech is 'hiding' that because the represent over 20% of that index. Sorry for my bad englando.
@@MarkMeldrum yeah they are forced to continue operating as its simply to expensive to shut down. Flawed us oil strategy assumes high demand and blinded by being a net oil exporter. Can see same thing happen in June contracts. If I was China I will be loading up. They will come out the best from this pandemic.
54 companies from SP500 reported by now with a -30% YoY (20 were financials with -50%) in earnings and it is Q1 which did not take a full Covid impact, Q2 should be worse ... with some q3 and q4 spike back, net 2020 we should be back around -30% ... but if this gets prolonged ... Overall, the nowhere to go argument seems to be stronger: even if we get -30% and then again -10 or so, seems the market will hold risky assets and just wait for the recovery in 202x ... strange ...
Hi, mark, if us interest rate is 0 as now, will the power of us dollar lose (us index is lower), and money will leave US, as China now stock market in the bottem and they are still paying 3% interest and if China GDP will gain back sooner, money may go there, any comments?
It would not surprise me if Trump feels the US should not have to pay China the $3 Trillion is tresuires they hold. I would not put money into China now - the world's anger has not yet shown itself. I think China is in store for some global punishment, rightly or wrongly. People's belief is their reality.
@@MarkMeldrum thanks Mark, that is a good point, they do hide important infor of the virus not only to the outside world but also their own people, the current situation seems under control in China, but the way government dealing outside world definitely hurt both side in long run. Now it is really depends on how fast the world could speed up the process of depart from relying on Chinese production, and move the job and industry to other places, what is your view on this?
I do think you will see movement away from China. I do see more countries taking a much harder line with China as well, especially on health and safety.
Good stuff however I know you have to be using TA for nimble decisions..as a CMT/CFTe lev3 CFA candy in ur program my hit rate using 8/21 MA RSI and ADX +/- indys is over 95%..bought and sold XOP from when this video came out..up in mid teens with zero trade drag at TDA;..cmon you cant trade currencies without TA on ST basis )
@@MarkMeldrum Hello Professor, how did you arrive at the initial 8.0% increase in earnings for 2020, that resulted in 178 earnings for 2020 and was used as the divisor for getting 18x forward PE?
Mark, please make more videos like this. It feels great to see what we learned from CFA can be applied to the real world. Thank you!
Amazing. I would PAY for a podcast
Me too!
I second that.
Great analysis, thanks. "Just a train wreck of a body" drove the point home
Hey Mark, you play a major role in reassuring one-self that sanity will prevail in the long run. Thanks
Mark, love these videos. Thank you!
I reckon this is how you deferentiate your course by connecting textbook theories to the latest events! Love it.
Another excellent analysis Mark...love how you link the CFA learnings with what's currently happening around us. Keep up the great work!!
An excellent presentation. Your analysis and rationale of the S&P level and its likely future levels were particularly insightful.
It would not surprise me if companies such as Microsoft and Google become valued at some point at 33x 2021 earnings simply because of their balance sheets, dominance of their sectors, their cashflows and the realisation that a 3% yield on their stock is better than zero on long term treasuries.
Best analysis so far on RUclips, clear precise and to the point
Hi Mark. Great analysis! Please continue making more of such videos.
Love your insight, Mark. Please continue posting these.
Thank You Sir , for making this video ..... Very helpful to see knowledge being applied practically in the markets !
Amazing professor. Nice to see theories being practically applied.
Thank you Mark. You’re advise and teachings are priceless. I completely agree with you, never bet against ugly getting some love.
Thank you for this video. I really wanted to hear thoughts from someone of the CFA Society openly like this.
Thank you Dr Mark! You’re a legend!
The man is simply amazing.. dont have words.. thank you very much
Your analysis are outstanding as usual, rich of informations. Thank you and keep it up if possible
Thanks for your prospective on these events, Mark. I hope you continue making videos like this because a lot of us value your opinion on financial markets and the economy.
Thank you for the awesome analysis Mark. Please keep em coming.
WOW! Thank you. Love your course on your website and these regular video updates are awesome
Thanks Mark, cheers from Chile
Excellent insight, please continue
Thanks Mark. Opinion on S&P does makes sense.
As usual, great content, straight to the point and very informative. Thank you!
Thanks Dr. Meldrum for the great analysis. Please continue. Much appreciated.
These videos are fantastic, thank you.
Mark: I got the FEDs on my side
Bears: O_O
Brilliantly laid down reasons for Oil prices being negative and the future impact on the prices.
Very very good thoughts! Thanks for sharing!
great analysis, took my 3k loss on one contract by selling @ 20 dollars a barrel. Knew it was going to drop after reading an article about hedge funds reprogramming their algos to trade futures negative. Saved me 57000 in potential loss. Sometimes you gotta take it on the chin.
Amazingly and simply explained 👍🏻
Thank you Mark
Outstanding video
truly great stuff. i recommend your recommendation.
Thank you Mark. I was waiting for your insight.
I remember the day March 20, 2020 I informed my clients to keep buying high quality oil companies for long term as never in the history oil gone negative.
Great breakdown Mark!
Very good lesson. Connect the CFA knowledge to real life. Today market closed at 2939.
Great stuff Mark, thank you
Thanks Mark.
Love it, Thanks Mark!
And here I am almost a year later watching while reviewing for my cfa exam thinking... WOW who would have thought back then that WTI would be at 60, 11 months later?
Wow this is wonderful and insightful!
Just watched the complete Video ...... Wish there was a super like button on here ...... Great work Sir :) I'm definitely considering to buy the US oil ETF !
watch out with holding USO it will suffer from contango decay as it rolls over its expiring contracts. someone else commented about it below as well
FMCG Sector in India is I think a beautiful example of "no where else to go" I bought companies such Nestle India and Dmart they trade at 80 to 100 PE . At that point I thought that the companies were overvalued but the valuation seems to be just exploding over the years because there are no other good companies and the money is simply being diverted to stocks of great companies. Can you believe a 100PE multiple is a new normal. I generated 35% returns over last 6 months.
Impressive, great education.
nice analogy at the end
great content as always
Very good analysis. I'm wondering how you would frame this with the long term debt cycle. Could you give us your thoughts on that?
I'll need something more specific than that.
@@MarkMeldrumdo you believe there could be a big pullback caused by the huge levels of debt we're in? By big I meant bigger than you say in the video. If we consider the long term debt theory over the ~20-year cycles, we should be up for a bigger correction than the one caused by COVID-19
Great ! Thank you
THANKS MARK
Thank you! Well said.
Thank you Mark. It is always so insightful to get your analysis on the market. Please keep up the great work.
I have written a master’s thesis on the three goals of the FED. It is not a common belief among the academics that the FED supports asset prices, however i was able to conclude that there is a relationship between low asset prices and FED policy rate. Inspired to hear from you that you share a common analogy.
As for the oil, I am hoping/believing that oil supply will level the demand and prices will at least reach 30-40 a barrel within a year or two. However, can USO or Barclays ishares ETN go out of business before that? If so would the investors lose all their investments?
Hi Mark, I might be confused on your last remark on historical P/E values. So I wish to clarify. It's shown in the chart in the link below that the average P/E range was between 8 to >20 in the 1930s. And during 1950-1960s it ranged between 7 to >20. The P/E only seemed to edge upwards approaching the end of 20th century.
I'm not sure what I'm understanding wrongly when you state that P/Es of 3-4 were the norm during 1930s and 8-10 were the norm during 1950s. If you would be so kind as to explain. Cheers!
www.macrotrends.net/2577/sp-500-pe-ratio-price-to-earnings-chart
We should all take a moment and thank God for making The God of Finance this kind and willing to share his knowledge and insights.
I agree with a lot of what you said, except I don't think you're considering the algos programmed for certain levels. I try to take these into consideration when buying and selling. The algos are driving close to 60% of this volatility. I'd love to hear your thoughts on it. It's not human traders sitting behind a desk buying and selling 100s of millions of shares an hour. Because of the machines, I expect this volatility to last for a while.
Stonks only go up
Hi Mark, quick question, the cost of storage in the forward/future formula is expressed as a ‘rate’ (%). What is it a % of in real world terms? I understand that cost of storage as an absolute value (cost of a tanker), but don’t understand how it works in theory.
If a contract for 1,000 barrels has a value of $20,000 and storage for 1000 barrels for one month will be $5/barrel, then on pick-up, you would owe $25,000. LN(25,000/20,000) will give you a continuously compounded rate for one month.
Thank you for this video Mark great content...would you believe that the tsx/cad$ would tank due to oil for the short term (6months or so)
TSX is energy heavy - but a lot of that damage has been done. This won't help. CAD is responding, yesterday and today down a total of about 200 pips.
Isn't USO destined to lose money if it's rolling into higher cost contracts each month given the contango futures curve?
Yes
USO loses money in contango and makes money in backwardation
USO as of this morning has suspended the creation of any new shares.
Great content! Thanks for sharing your thoughts!
I have a question regarding forward P/E ratios - do those take into account at all any potential changes in corporate taxes?
Great video Mark - really, the most value added videos are yours.
Whats the likelihood that big investors change up their IPS to include high yield bonds etc? That would considerably reduce the strength of your argument wouldnt it? Also I really find it difficult to value SP off of 18x earnings. I think 15-16 is more reasonable considering the ten year average, would you agree? Although at this point probably semantics
Hey Mark,
But one question though if the pandemic hits harder will that not lead to new lows? And nobody can certainly tell the probability of that happening or not.
That is the risk of playing this game. At any time, no matter what is going on, there is risk. Always risk. So investing is risk management first. If you can’t get comfortable with risk, there is always accounting as a career.
@@MarkMeldrum Roger that
remarkable
USO is literally a futures contract.... as you said. That is the last place you should be putting your money if you want to bet on oil. ENERGY is where you want to be. invest in the producers. generational buying opportunities in the next 6 months...
Mark, about the “nowhere else to go”. What about the gold? We can go there
Ilie Negura I think he is mostly referring to the institutional investors in his analysis of the market, and gold is a very speculative investment for these institutions to make. These institutions have to follow investment guidelines and manage their risk exposure, and I bet that most of their investment guidelines wouldn’t let them invest much of their portfolios in gold. The price of gold is 100% speculative and it doesn’t have any intrinsic value (meaning it doesn’t provide any potential for cash flows or earnings growth). From what I’ve read, the only time gold is an appropriate investment is to protect against hyperinflation. Unless you’re predicting a doomsday scenario where there is hyperinflation, gold is much too volatile and it doesn’t provide any returns, so the majority of investors wouldn’t fill their portfolios with it :)
Hi Mark, wouldn't the ETFs just have splits / consolidations, much like the leveraged ETF TVIX (VIX futures) contracts, that had to deal with heavy contago, you can see in the time series. I think ETNs can have a different structure again, as the collateral is written by a large bank like Barclays, the price can be synthetic? I'm not 100% on these concepts but this is my 2 cents
I am not an ETF expert. I do know one - so I will see if I can get him to comment to these questions.
USO as of this morning has suspended the creation of any new shares.
@@MarkMeldrum Appears IB has settled up with the clearinghouses , but probably chasing customers over the losses? www.businesswire.com/news/home/20200421005853/en/Interactive-Brokers-Issues-Statement-Crude-Oil-Contracts
@@MarkMeldrum USO: 8-1 reverse stock split: www.zerohedge.com/markets/uso-oil-etf-execute-1-8-reverse-stock-split
Hi Mark,
Great Video. Do you think Pension will tap into oversea market for growth?
I needed the laugh at 31:20. Thanks Mark.
well explained
And how much power do you think the FED has anymore to meet its "triple" mandate? considering 0% interest rates?
Hello Mark, thanks a lot for your precious efforts I am a level one candidate and I quite understand derivatives of level one but I have some issues beyond the scope of the material in level one that confuse me so I hope you correct my guesses if I am wrong:
say that I entered a long position for future contract with a settlement price equal for example 100 and as I know the contract trades at the exchange at initiation at a 100 and then strats to fluctuate over the the term of the contract and let say at a given point of time the contract value declines to 90 and I've decided to close the position before expiration and sell the contract and accept the 90!! So how the exchange close my position and what would be the cash changes in my account as a result?!!!
I have a guess and I hope you correct it If I'm wrong:
Is means the exchange would clear the difference between the value of contract at initiation and the price I accept to sell the contract for which means the exchange would withdraw 10 from my account.
While the person (Mr X) who take the position from me would beer the obligation towards the the short party, and let say that Mr X hold the position for expiration to have the settlement!
Now what is the case how the short party get the settlement price of 100?!!
Should Mr X just pay the 90 while the exchange afford the difference of the (10)?!
On the whole, very informative vid Mark. Just wanted to point out that what you said related to PE ratios greatly increasing over the past 80 or so years is not necessarily accurate when talking about the SP (www.multpl.com/s-p-500-pe-ratio/table/by-year). Although it does seem the ratios became very high coming out of other downturns such as the dotcom crash and the 08 real estate crisis, likely for a lot of the reasons you mention.
If PE ratios were to increase dramatically over time in this linear fashion as suggested, then the lower yield of equities would likely decrease the attractiveness of the asset class relative to others and a shift in SAA for these institutions and funds would likely take place. Whether that be towards holding more lower yield but less risky investments, or towards greater tolerance for higher yield and riskier asset classes.
What are you thoughts on the Austrian business cycle theory ?
Mark, wouldn't you be purchasing the option contract at the ask price ($16.30) and not the bid price ($16.71)? In other words, you would be receiving $16,300 for purchasing the contract.
The two are traded as a pair with their own bid and asks. I use limit prices.
Dr Mark, great video and extremely valuable insights as always. Just a quick comment concerning " Where else to go" at my level as a very small investor, with a lot of uncertainty in the market now I would personally "out of fear" avoid equities (I was considering shortening the market, but after your video not anymore :) I was considering alternative investments, real estate for instance, or commodities, with that said, if institutional investors would seek same path, and private equity option is in their range of sight, then the equity market might as well drop substantially. I believe human nature (fear and herding effect) will dictate where we go from here. do you think I make any sense ?
Hi Mark. A question.
Considering the major demand reduction due to global lockdowns, many people expected and were aware of the oversupply of crude in the market. What I'm a little confused about is why they waited till the very last day to exit their positions/cancel contracts. Why do you think this happened?
Hope
"No where else to go." Is real estate a good place to go? Seems a residential rental is a place that continues to produce cash flow, people must have a place to live...buy in a manufacturing area, below the median, get affordable single family homes at average prices and rent those homes for a 5-7% ROI...seems a great place to store your treasure. Let me know your thoughts?
Hey Mark, President Trump has decided to add 75 millions barrels of oil to strategic reserve.
Hi Dr. Mark, what are you using as the spot price for crude oil in calculating the future price. I tried finding the sport price of crude oil but was unable to find it. Everywhere I search, I only get futures contract price.
Basically what I hear on Bloomberg. Typically you would have to pay for real-time spot market data.
love you mark. #nohomo
I am someone who has been studying stocks for a couple of months and don't pretend to be an expert, but looking at the S&P500 the index is havily concentraded on GAFAM and the recovery was just too quicky, but considering that the fundamentals of most of the companys are far worst than they were 3 months ago, how can it be that the S&P is so high so fast? I'm just saying that in fact there's a bubble but the big tech is 'hiding' that because the represent over 20% of that index. Sorry for my bad englando.
28:00 You forgot about BoJ.
Cannot leave oil in the ground as Wells and reservoirs dry up so needs to continue operating
Interesting. Gives the continued oversupply argument more weight.
@@MarkMeldrum yeah they are forced to continue operating as its simply to expensive to shut down.
Flawed us oil strategy assumes high demand and blinded by being a net oil exporter.
Can see same thing happen in June contracts.
If I was China I will be loading up. They will come out the best from this pandemic.
is there any intro video for economics section for the level 1 in your website sir?
Hi Mark, what trading platform do you use?
Interactive brokers
@@MarkMeldrum Thanks Mark!
Can anyone recommend similar videos/channels to Mark's analysis?
Not feeling so good about my puts now
Mark,
What do you think about NRGU ( the 3 multiples ETF) for 6+month investment. Thanks.
No opinion. But stay away from levered ETFs unless you know what you are doing.
54 companies from SP500 reported by now with a -30% YoY (20 were financials with -50%) in earnings and it is Q1 which did not take a full Covid impact, Q2 should be worse ... with some q3 and q4 spike back, net 2020 we should be back around -30% ... but if this gets prolonged ...
Overall, the nowhere to go argument seems to be stronger: even if we get -30% and then again -10 or so, seems the market will hold risky assets and just wait for the recovery in 202x ... strange ...
Can NAV be negative?
Hi lecturer
Thank you million time
Iam Your student from Somalia
Please change written it's difficult to see very well as other computerised
Does anyone know if ETFs such as CRUD and USO can go negative ?
USO works until it doesn‘t. Brings to mind the now terminated XIV ETFs. Could happen with USO, just dissolve the fund.
USO as of this morning has suspended the creation of any new shares.
Hi, mark, if us interest rate is 0 as now, will the power of us dollar lose (us index is lower), and money will leave US, as China now stock market in the bottem and they are still paying 3% interest and if China GDP will gain back sooner, money may go there, any comments?
some might, exchange rate and inflation are also considerations , level 2 economics had this topic :P
It would not surprise me if Trump feels the US should not have to pay China the $3 Trillion is tresuires they hold. I would not put money into China now - the world's anger has not yet shown itself. I think China is in store for some global punishment, rightly or wrongly. People's belief is their reality.
@@MarkMeldrum thanks Mark, that is a good point, they do hide important infor of the virus not only to the outside world but also their own people, the current situation seems under control in China, but the way government dealing outside world definitely hurt both side in long run. Now it is really depends on how fast the world could speed up the process of depart from relying on Chinese production, and move the job and industry to other places, what is your view on this?
I do think you will see movement away from China. I do see more countries taking a much harder line with China as well, especially on health and safety.
unless the Fed loses control of interest rates
Good stuff however I know you have to be using TA for nimble decisions..as a CMT/CFTe lev3 CFA candy in ur program my hit rate using 8/21 MA RSI and ADX +/- indys is over 95%..bought and sold XOP from when this video came out..up in mid teens with zero trade drag at TDA;..cmon you cant trade currencies without TA on ST basis )
How we got 165 earnings
Reported earnings for the SnP500 components for 2019.
Thank you
@@MarkMeldrum Hello Professor, how did you arrive at the initial 8.0% increase in earnings for 2020, that resulted in 178 earnings for 2020 and was used as the divisor for getting 18x forward PE?
This guy is on fire. Lol