The Fed's recent actions have led to a reevaluation of what it means to 'fight the Fed,' and it's crucial for investors to understand the difference between a trading opportunity and an investable rally.
Strategies
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As the sustainability-linked bond (SLB) market expands, we expect to see well-established norms at the issuer side and consensus among investors, as well as more transparent and relevant target settings which are imperative for fostering an efficient SLB market with minimal transaction cost.
Trying to outsmart the market has been around just as long as the market itself, and though it rarely works, many people keep trying. Not only are you less likely to outperform the market through market timing, you could further reduce your returns depending on how often you trade.
Nvidia's valuations today closely resemble Cisco at its peak in 2000, with a price-to-sales ratio of 42x, making it hard to make the math work for Nvidia stock to perform well from its current level.
Ultimately, one will prove more correct than the other, but a major divergence can persist for quite some time. The pools of investors have different enough viewpoints to allow the divergent theses to co-exist for a while.
Investors who believe that equity markets are currently overextended may consider adding defined outcome strategies to their portfolio, which aim to provide capital appreciation up to a capped level while offering the added benefit of buffering downside moves.
The clean energy transition is gaining momentum, with governments around the world implementing policies to boost energy security and mitigate climate change. However, the growth of clean technologies must accelerate even more to stay on track for net-zero emissions and 1.5°C pathways. With significant investment opportunities available, the outlook for clean technologies and related industries appears promising.
The industrial sector has lagged the S&P 500 index by roughly -720 basis points this year as of May 16, 2023, driven by weakness in machinery, aerospace, and defense stocks.
The 'Sell in May' strategy is also referred to as the 'Halloween indicator' due to the tendency of stock market returns to improve after Halloween.
REIT companies are mandated by law to pay out at least 90% of their taxable income as dividends. You must be careful as the key term here is taxable income. The crucial questions to consider when evaluating a REIT are what are the assets they own, how much cash flow the assets produce, and why do I want to own these assets for the long term?
The Fed's recent actions have led to a reevaluation of what it means to 'fight the Fed,' and it's crucial for investors to understand the difference between a trading opportunity and an investable rally.