Money and Finance
- Steve Romick's Q4 Commentary
Link to: Steve Romick's Q4 CommentaryForgive us if we bring you up to date this year, in part, through the lens of the distant past. We can’t help but think that the creators of Greek tragedies – those of the ancient variety, not the ongoing,...
- Steven Romick's Q1 Commentary
Though the players involved may change from one generation to the next, investing at its core is, and always will be, nothing more than a tug of war between fear and greed. Fear summons the wanton selling of assets without regard to value, a scenario...
- Net Worth Update - September 2015
While cash flow is more important when it comes to financial independence, it's still good to look at the balance sheet too, which is why I provide these net worth updates. Since more and more of my net worth is tied to the markets, there's...
- Colgate-palmolive Co.: Excellent Company But How's The Valuation?
When volatility in the markets increases that leads many investors to look for defensive investments that will hold up during a market downturn. Consumer staples are some of the best options when it comes to holding up in a declining market as well as...
- What Are You Buying?
The government continues to remain deadlocked and it looks like that is going to continue up until the debt ceiling issue comes next week. Eventually they will work all of this mess out, but in the meantime the markets have been none too pleased. I'd...
Money and Finance
Steve Romick's Q3 Commentary
We would prefer that some of the lunacy we see out there translate into fear as that generally causes investors to sell assets without regard to value. Many of you would probably agree that people nowadays are anxious about both the economy and federal governance. And yet, the Federal Reserve’s QE (Quantitative Easing) policies continue to support asset prices, despite slower economic growth and myriad other uncertainties.
This can be seen in the returns of more speculative stocks. As a proxy for shares of that ilk, we turn to the most heavily shorted companies at the start of 2013. The top 100 most-heavily shorted stocks in the Russell 3000 returned 44.6% for the nine months ended September 30, dwarfing the index’s return of 19.52%.
With a reluctant nod to obliging central banks, the stock market seems to be the only game in town so equities continue their unabated rally, regardless of quality. It seems a lot of people share CNBC’s Jim Cramer’s view that, “We all know it’s going to end badly, but in the meantime we can make some money.” If you believe this trend will continue, you will most likely be better served having your capital with a manager who is more fully invested. As Morningstar analyst Dan Culloton observed in his most recent commentary about Crescent, “The past 10 years included two bear markets and were fraught with volatility, which plays to the fund’s strengths.” Absent volatility, we are like an automobile whose gas gauge is nearing empty. That doesn’t mean we are stuck in idle. We continue to read, speak to executives, visit companies, and then read some more. We’d like nothing more than to shift to a higher gear and increase our exposure, but given the lack of securities offering a genuine margin of safety, we’re content to stay out of the fast lane for now.
In the meantime, we’ve taken advantage of the kindness of others who seem to have plenty of petrol and have bid up many of our investments to a point where we find the risk/reward unattractive. To remain intellectually honest and clinically dispassionate, we have found ourselves with little alternative but to make some sales.
- Steve Romick's Q4 Commentary
Link to: Steve Romick's Q4 CommentaryForgive us if we bring you up to date this year, in part, through the lens of the distant past. We can’t help but think that the creators of Greek tragedies – those of the ancient variety, not the ongoing,...
- Steven Romick's Q1 Commentary
Though the players involved may change from one generation to the next, investing at its core is, and always will be, nothing more than a tug of war between fear and greed. Fear summons the wanton selling of assets without regard to value, a scenario...
- Net Worth Update - September 2015
While cash flow is more important when it comes to financial independence, it's still good to look at the balance sheet too, which is why I provide these net worth updates. Since more and more of my net worth is tied to the markets, there's...
- Colgate-palmolive Co.: Excellent Company But How's The Valuation?
When volatility in the markets increases that leads many investors to look for defensive investments that will hold up during a market downturn. Consumer staples are some of the best options when it comes to holding up in a declining market as well as...
- What Are You Buying?
The government continues to remain deadlocked and it looks like that is going to continue up until the debt ceiling issue comes next week. Eventually they will work all of this mess out, but in the meantime the markets have been none too pleased. I'd...