State of the Markets: Modeling 2020 Expectations (Just For Fun)


The State of the Markets:

Happy Monday and welcome back to the land of blinking screens. I don't know about you, but I've been intrigued lately by all the projections/prognostications that analysts feel compelled to provide at the beginning of each year. So, just for fun, I thought I'd join in the game this year.

To be clear, I do NOT manage money based on predictions, macro views, or the proverbial gut hunches. No, I prefer to stick to the weight of the evidence from a plethora of market models. I strive to keep portfolios positioned in line with what "is" happening in the market and not what I think "should" to be happening in the market. I learned a LONG time ago that Ms. Market doesn't give a hoot about what I think "ought" to be happening in her game and that my primary job is to try and get it mostly right, most of the time.

However, I'm also known in the business as a bit of a model geek. So, I decided to try my hand at "modeling" the outlook for the S&P 500 this year. But as I hope I've made clear, this is a "just for fun" exercise.

The Market Drivers

I decided to start with what I believe to be the primary drivers of stock market returns. Namely the economy, earnings, monetary conditions, inflation, the technical health of the market, and historical market cycles.

I then dug into my trusty model toolbox and dug out indicators and/or models for each of these components. Or in some cases, I combined multiple models to create a composite model.

The Models

I wound up with seven models. Next, I looked at the average annual historical return of the S&P ...

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Modeling 2020 Expectations (Just For Fun)

Happy Monday and welcome back to the land of blinking screens. I don't know about you, but I've become intrigued lately with all the projections/prognostications that analysts feel compelled to provide at the beginning of each year ...

Read More
Comments

Current Holdings for ALL-NEW 2020 Daily Decision Model Portfolio


The ALL-NEW 2020 Daily Decision Model Portfolio

ALL NEW FOR 2020!

The Daily Decision Model Portfolio is an active, risk-managed, multi-strategy, multi-manager strategy designed to be an aggressive growth approach. The primary objective of the portfolio is to stay in ...

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INTRODUCING: The ALL-NEW Daily Decision Model Portfolio for 2020


ALL NEW FOR 2020!

The 2020 Daily Decision Model Portfolio

The 2020 Daily Decision Model Portfolio is all new for 2020. We will be launching the portfolio this afternoon - so be prepared for the trade alerts!

Why The Change?

As ...

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Tips From Real-World Wendy Rhoades

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The Best Recession Ever!

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Instead of the economy flirting with negative growth ...

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The Message From The Models: The Bulls Are In Charge, But...

It was a busy weekend of birthday celebrations (we had 2) and important family events in my household (our youngest is moving into her first apartment!) and as such, I didn't take the opportunity to spend a couple hours ...

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Party On, Wayne!

The joyride to the upside in the stock market continued last week as the S&P 500 surged another 2.5%. If my calculator is correct, this means the venerable blue-chip index is now up 10.7% so far in 2019 ...

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