Investment Strategy Today
Due to the downward pressures in the market this week many stocks that were identified previously as SELL have moved far enough down to become fairly valued. On a similar note, many stocks in the lower regions of fair value have become undervalued and are on the BUY WATCH list. When the market returns to more favorable terms these stocks may become BUY considerations.
Investment Strategy Today
Market expectations were continually increasing to the point of overvaluation across all market capitalizations, but especially in MidCap and SmallCap classes. The market in total was well in cautionary position. While no one ever knows the exact time, it seemed reasonable the market would need to return to fair value. This generally occurs when investors realize their expectations exceed the ability of stocks to return value through revenues, earnings and dividends. That time appears to be occurring as the market is nicely returning to fair value territory.
Asset Allocation 4th Quarter
This report offers a discussion on a practical method of how asset allocation can be used to satisfy an investor’s desire for stability and opportunity within an investment portfolio. It is our objective to create a solid basis for understanding changes in allocations when considering objectives, risks and market characteristics.
USA Stock Considerations
Investor expectations have moderated while earnings advanced producing a welcomed reduction in valuation pressures across the entire market. Relative valuations have moved just below Cautionary levels (120.0% Fv) at 119.1% Fv which is a generous reduction from last month.
Stock Fair Value Report October
Outside of Consumer Discretionary the remaining sectors are producing valuations within normal ranges. Only two sectors reside at Cautionary levels, Energy at 129.8% Fv and Information Technology at 124.9% Fv. Energy has made a significant move over the past 24 months from undervaluation to the high ranges of normal.