Recently one of the mostly-followed corporate finance and valuation professor Aswath Damodaran has updated his metrix of the so called Equity Risk Premia (ERP) for countries around the globle. Unlike in recent year, this year the change in ERPs in some countries has been very significant. This is mostly because of the new phenomena that…
Over the last decade the correlation between inflation (measured by CPI YoY change) and the $SPX500 returns (also YoY) was clearly positive and pretty stong. Higher moderate inflation (below 3%) usually meant higher GDP growth, higher EPS growth for US corporations and generally healthy economic conditions. This naturally impacted stocks returns. Lower inflation (perios of…
$PYPL (PayPal Holdings) quick facts: ✅ lost 70% top to recent bottom and 61% top to now ✅ major reasons for sell-off: 👉 Growth stocks hit on higher yields 👉 change in Fed’s stance from ultra dovish to hawkish in fight of inflation 👉 disappointing revenue and profit forecasts for 2022 👉 lower consumer spending…
We had a hell of a day yesterday with GlobalAlphaS portfolio up 5.04%. Main reasons for the performanace: 👉 Long equity hedges netted out in Feb/strat March 👉 Portfolio positioned to gain on the expected (and now materializing) rebound off the correction’s lows as situation around Ukrain descalates and 1st Fed rate hike is behind…
Many investors scratch their heads these days as to whether the current market circumstances we’re facing constitute a good buying opportunity for stocks. In this short article I am trying to assess this question from three different perspectives: macro, micro and technical. The macro perspective This point of view is possibly the biggest worry for…
Below you can see Wells Fargo’s latest Fed balance sheet size projections. Recently the Fed has: 👉 announced tapering (Autumn) 👉 begun tapering (Dec 2021) 👉 announced that they plan to speed up tapering vs. what they previously planned (from USD15bn/month to USD30bn/month) (announced after Dec FOMC meeting) 👉 announced that right after reaching net…
Attached you will find a long term Bloomberg graph showing a very important equities characteristic that usually has significant impact on their overall returns in the future – the Real Earnings Yield. This graph shows aggregate data for the $SPX500. What is Earnings Yield (EY)? 🤔 EY is calculated by dividing a stock’s EPS by…
Dear Followers&Copiers, A short note on $INTC (Intel) and the price reaction post its earnings release: 👉 Earnings were actually mixed to better than expected: EPS: $1.71, adjusted, versus $1.11 expected. Revenue: $18.1 billion, adjusted, versus $18.24 billion expected. Exp 4Q21 revs $18,3bn vs. $18,24bn exp 👉 The reasons for an 11% drop were actually…
𝗜𝘁’𝘀 𝗯𝗲𝗲𝗻 𝗮 𝘀𝗵𝗼𝗿𝘁𝗲𝗿 𝘄𝗲𝗲𝗸. 𝗘𝗾𝘂𝗶𝘁𝗶𝗲𝘀 𝗳𝗲𝗹𝗹 𝗲𝘃𝗲𝗿𝘆 𝘀𝗶𝗻𝗴𝗹𝗲 𝗱𝗮𝘆 𝘁𝗵𝗶𝘀 𝘄𝗲𝗲𝗸. 𝗜𝗻𝗱𝗶𝗰𝗲𝘀 𝗶𝗻 𝗨𝗦 𝗮𝗻𝗱 𝗘𝗨 𝗲𝗻𝗱𝗲𝗱 𝗶𝗻 𝘁𝗵𝗲 𝗿𝗲𝗱 𝗳𝗼𝗿 𝘁𝗵𝗲 𝘄𝗲𝗲𝗸, 𝘄𝗵𝗶𝗹𝘀𝘁 𝗔𝘀𝗶𝗮 𝗼𝘂𝘁𝗽𝗲𝗿𝗳𝗼𝗿𝗺𝗲𝗱 𝗮𝗴𝗮𝗶𝗻. 𝗠𝗮𝗷𝗼𝗿 𝗿𝗲𝗮𝘀𝗼𝗻𝘀 𝗳𝗼𝗿 𝘁𝗵𝗲 𝗿𝗲𝘁𝗿𝗲𝗮𝘁 𝗮𝗿𝗲 𝗗𝗲𝗹𝘁𝗮 𝘃𝗮𝗿𝗶𝗮𝗻 𝗰𝗮𝘀𝗲𝘀, 𝗦𝗲𝗽𝘁𝗲𝗺𝗯𝗲𝗿’𝘀 𝘃𝘂𝗹𝗻𝗲𝗿𝗮𝗯𝗶𝗹𝗶𝘁𝘆, 𝗽𝗲𝗿𝘀𝗶𝘁𝗲𝗻𝘁 𝗵𝗶𝗴𝗵 𝗶𝗻𝗳𝗹𝗮𝘁𝗶𝗼𝗻 𝗿𝗲𝗮𝗱𝗶𝗻𝗴𝘀 (𝗣𝗣𝗜 𝘁𝗵𝗶𝘀 𝘄𝗲𝗲𝗸), 𝘁𝗮𝗽𝗲𝗿𝗶𝗻𝗴 𝗮𝗻𝗻𝗼𝘂𝗻𝗰𝗲𝗺𝗲𝗻𝘁 𝗳𝗲𝗮𝗿𝘀. $SPX500 is now 2% off its…
𝗗𝗲𝗮𝗿 𝗖𝗼𝗽𝗶𝗲𝗿𝘀/𝗙𝗼𝗹𝗹𝗼𝘄𝗲𝗿𝘀, 𝘁𝗵𝗶𝘀 𝘄𝗲𝗲𝗸 𝗜 𝗮𝗺 𝘄𝗿𝗶𝘁𝗶𝗻𝗴 𝘁𝗵𝗲 𝗪𝗲𝗲𝗸𝗹𝘆 𝗮𝘀 𝗼𝗳 𝗙𝗿𝗶𝗱𝗮𝘆 𝗺𝗼𝗿𝗻𝗶𝗻𝗴 (𝘀𝗼 𝘄𝗼𝗻’𝘁 𝗰𝗼𝘃𝗲𝗿 𝗙𝗿𝗶𝗱𝗮𝘆), 𝗮𝘀 𝗜 𝘄𝗶𝗹𝗹 𝗯𝗲 𝗼𝘂𝘁 𝗶𝗻 𝗮 𝗽𝗹𝗮𝗰𝗲 𝘄𝗶𝘁𝗵𝗼𝘂𝘁 𝗶𝗻𝘁𝗲𝗿𝗻𝗲𝘁 𝗳𝗼𝗿 𝘁𝗵𝗲 𝘄𝗲𝗲𝗸𝗲𝗻𝗱. 𝗧𝗼𝗱𝗮𝘆 𝗯𝗲 𝘄𝗮𝘁𝗰𝗵𝗶𝗻𝗴 𝗳𝗼𝗿 𝘁𝗵𝗲 𝗡𝗙𝗣 𝗿𝗲𝗮𝗱𝗶𝗻𝗴, 𝘄𝗵𝗶𝗰𝗵 𝘁𝗵𝗲 𝗙𝗲𝗱 𝘀𝘂𝗿𝗲𝗹𝘆 𝘄𝗶𝗹𝗹 𝘄𝗮𝘁𝗰𝗵 𝗰𝗹𝗼𝘀𝗲𝗹𝘆 𝘁𝗼𝗼 :). It’s been another strong week for equities. Especially Japan…
