The concept of buying when there is “blood in the streets” is well-known to most investors, particularly as a figurative expression that calls for moving into beaten-down sectors when they’re really out of favor. Yet when there’s literally blood in the streets, it’s probably wise to steer clear of stocks in the hot zone. #-ad_banner-# Traders certainly steered clear of the hot zone between Russia and Eastern Ukraine at the beginning of the year. The Market Vectors Russia ETF (NYSE: RSX) tumbled roughly 25% in the first 11 weeks as the tensions between the former Soviet Union and … Read More

The concept of buying when there is “blood in the streets” is well-known to most investors, particularly as a figurative expression that calls for moving into beaten-down sectors when they’re really out of favor. Yet when there’s literally blood in the streets, it’s probably wise to steer clear of stocks in the hot zone. #-ad_banner-# Traders certainly steered clear of the hot zone between Russia and Eastern Ukraine at the beginning of the year. The Market Vectors Russia ETF (NYSE: RSX) tumbled roughly 25% in the first 11 weeks as the tensions between the former Soviet Union and Ukraine culminated with Russia annexing the Crimea region in strong-arm style. However, following the multiyear low in RSX in mid-March, Russian stocks have been strong performers. RSX is up 20% since its March 13 low, more than double the gains in the S&P 500 over the same time period. Renewed tensions in the region in July sparked by the shooting down of a Malaysia Airlines passenger jet by pro-Russian separatists caused another big sell-off. This quickly took RSX below its 50-day and 200-day moving averages, as once again the… Read More

As any wealth advisor will suggest, diversification can protect a portfolio from the ups and downs of a volatile market. But with both stocks and bonds trading at high levels and gold languishing, where can an investor turn? The answer is food. We all have to eat, and right now agricultural commodities such as livestock and grains look as if they have found respective bottoms. There are many reasons, both technical and fundamental, why adding a small representation of commodities to a portfolio is a good idea. #-ad_banner-#​From the fundamental side, wheat… Read More

As any wealth advisor will suggest, diversification can protect a portfolio from the ups and downs of a volatile market. But with both stocks and bonds trading at high levels and gold languishing, where can an investor turn? The answer is food. We all have to eat, and right now agricultural commodities such as livestock and grains look as if they have found respective bottoms. There are many reasons, both technical and fundamental, why adding a small representation of commodities to a portfolio is a good idea. #-ad_banner-#​From the fundamental side, wheat prices are reacting positively to the current Russia-Ukraine conflict. These countries are two of the world’s largest exporters of the grain, so supply concerns are front and center. And Kansas City HRW wheat futures have found support at current levels that can be traced back to 2012, if not longer. On the technical side, we’re seeing upside reversals in a number of charts. The iPath DJ-UBS Livestock SubTR ETN (NYSE: COW) scored an upside reversal on Aug. 21, as both of its components — live cattle and… Read More

Shares of CME Group (NASDAQ: CME) bounced nicely in recent days as the financial sector continues to support the broader market’s rally. This operator of derivatives and futures exchanges has offered up a number of high-probability trade setups over the past 18 months, and if financials can hold their recent bid, then another chance at short-term profits looks to be on the horizon. Whenever I see a trade setting up in a financial stock, I feel compelled to reiterate the sector’s importance to the tone and strength of the overall stock market. Not only is it one of the largest… Read More

Shares of CME Group (NASDAQ: CME) bounced nicely in recent days as the financial sector continues to support the broader market’s rally. This operator of derivatives and futures exchanges has offered up a number of high-probability trade setups over the past 18 months, and if financials can hold their recent bid, then another chance at short-term profits looks to be on the horizon. Whenever I see a trade setting up in a financial stock, I feel compelled to reiterate the sector’s importance to the tone and strength of the overall stock market. Not only is it one of the largest industries in the United States, but it is intertwined with just about all other industries. #-ad_banner-#Of particular interest from an investing and trading perspective is watching the large bank stocks, which often act as a leading indicator for the broader market. This makes sense considering bankers’ insight into business activities, which in turn, causes them to either expand or rein in lending. In addition to banks, it is helpful to watch insurance companies, brokers and exchange operators such as CME Group for signs of relative strength or weakness. In that vein, the following chart… Read More

I keep coming back to biotech stocks, and for good reason — the trends are up and the moves are big. However, with the stock market facing an important crossroads on the charts, I want to sleep at night. Therefore, a biotech ETF is the way to go.  On Thursday,… Read More

Some high-profile buyout deals have been falling apart lately. For instance, the third largest U.S. wireless carrier Sprint (NYSE: S) just announced it would end its bid to acquire rival T-Mobile (NYSE: TMUS), the number four carrier, because of staunch resistance from regulators. Media giant 21st Century Fox (NYSE: FOXA) ceased its pursuit of Time Warner Cable (NYSE: TWC) because the two simply couldn’t agree on a buyout price. A recent takeover attempt involving the big pharmaceutical firms Pfizer (NYSE: PFE) and AstraZeneca (NYSE: AZN) also went nowhere after the latter backed out at the last minute. #-ad_banner-#These and other… Read More

Some high-profile buyout deals have been falling apart lately. For instance, the third largest U.S. wireless carrier Sprint (NYSE: S) just announced it would end its bid to acquire rival T-Mobile (NYSE: TMUS), the number four carrier, because of staunch resistance from regulators. Media giant 21st Century Fox (NYSE: FOXA) ceased its pursuit of Time Warner Cable (NYSE: TWC) because the two simply couldn’t agree on a buyout price. A recent takeover attempt involving the big pharmaceutical firms Pfizer (NYSE: PFE) and AstraZeneca (NYSE: AZN) also went nowhere after the latter backed out at the last minute. #-ad_banner-#These and other big deals gone sour have been getting plenty of media attention, possibly giving the impression that M&A activity is weakening. But that couldn’t be further from the truth. According to software firm Dealogic, which offers multiple services including M&A analytics, failure rates for M&A deals have been falling since last year and are near pre-recession levels. What’s more, global M&A volume has reached nearly $2.3 trillion this year, a 43% year-over-year increase and the second-highest yearly total ever (after $3.1 trillion in 2007). And it looks like there’s plenty more to come. In a second-quarter letter to shareholders, legendary investor… Read More

Investors seem to have gotten over the beating that Internet stocks took from early March to early May, when the group plummeted about 20%. Since then, these stocks have rallied nearly 17% and appear to be gaining momentum once again. #-ad_banner-#​Facebook (Nasdaq: FB) has done particularly well, jumping more than 30% from a late-April low of $56 to the current price of almost $75. Following a 15% plunge to $518 in early May, Google (Nasdaq: GOOGL) has made up most of the ground it lost and now trades near $600.  Other well-known Internet stocks have come back strongly,… Read More

Investors seem to have gotten over the beating that Internet stocks took from early March to early May, when the group plummeted about 20%. Since then, these stocks have rallied nearly 17% and appear to be gaining momentum once again. #-ad_banner-#​Facebook (Nasdaq: FB) has done particularly well, jumping more than 30% from a late-April low of $56 to the current price of almost $75. Following a 15% plunge to $518 in early May, Google (Nasdaq: GOOGL) has made up most of the ground it lost and now trades near $600.  Other well-known Internet stocks have come back strongly, too, including travel agent Priceline (Nasdaq: PCLN), retail behemoth Amazon.com (Nasdaq: AMZN) and auction/e-commerce leader eBay (Nasdaq: EBAY).  Those looking to profit from the rebound have the daunting task of deciding which stocks to choose. There are many good ones, but it’s hard to know which. The world of Internet investing is still relatively new and often makes little sense, with stock prices that may seem to based more on hype and unreasonable expectations than solid fundamentals. Basically, it’s just too easy to make the wrong picks and get burned, even if you do your homework. That’s why in this… Read More

Six years after the big crash, the global economy still seems pretty shaky and could even be set for another meltdown, if some of today’s headlines are to be believed. Nevertheless, many enticing investment opportunities still abound — like robotics and automation, or R&A. #-ad_banner-#While R&A has been on the rise for decades, exciting advances have been occurring recently. For instance, the creation of physical objects from a digital file, the amazing manufacturing process known as 3-D printing, has improved so much it can be used to make nearly anything from footwear and firearms. Apparently, you can even… Read More

Six years after the big crash, the global economy still seems pretty shaky and could even be set for another meltdown, if some of today’s headlines are to be believed. Nevertheless, many enticing investment opportunities still abound — like robotics and automation, or R&A. #-ad_banner-#While R&A has been on the rise for decades, exciting advances have been occurring recently. For instance, the creation of physical objects from a digital file, the amazing manufacturing process known as 3-D printing, has improved so much it can be used to make nearly anything from footwear and firearms. Apparently, you can even print out a pizza now. R&A has been playing an ever-larger role in other areas, too, like medicine. For instance, robots are being developed to perform blood draws and other routine medical tasks, as well as more complex ones such as cardiovascular surgery. Increasingly capable robots are already common on assembly lines and in the military. Most investors have heard about how some big companies such as Apple (Nasdaq: AAPL), Google (Nasdaq: GOOG) and Amazon.com (Nasdaq: AMZN) are developing robots and/or snapping up promising robot manufacturers. Apple, for instance, is creating robots to help build iPhones and other devices. Google… Read More

Here at StreetAuthority, we’re big fans of the theme known as “guru investing” because following the trading moves of proven money managers can yield outsized gains. There is actually proof of such a notion: The Global X Guru Index ETF (Nasdaq: GURU) which launched in June 2012, is up a solid 75% since then, outperforming the S&P 500 Index by more than 20 percentage points.  GURU data by YCharts #-ad_banner-#Though this ETF buys and sells stocks that have popped upon the mandatory Form 13F statement of ownership lists,… Read More

Here at StreetAuthority, we’re big fans of the theme known as “guru investing” because following the trading moves of proven money managers can yield outsized gains. There is actually proof of such a notion: The Global X Guru Index ETF (Nasdaq: GURU) which launched in June 2012, is up a solid 75% since then, outperforming the S&P 500 Index by more than 20 percentage points.  GURU data by YCharts #-ad_banner-#Though this ETF buys and sells stocks that have popped upon the mandatory Form 13F statement of ownership lists, the strong outperformance may be attributable to a proprietary twist: Thanks to an undisclosed methodology, this ETF’s managers are able to focus on the best ideas in their purview, what are considered high-conviction ideas. As an example, they give a strong bias to the picks by hedge fund managers that show a buy-and-hold style, and avoid those fund managers that simply zoom in and out of various stocks at a rapid clip.  The best fund managers know that winning stock ideas often take awhile to ripen, and the most patient among them are often rewarded for their far-sightedness.  There is… Read More

The rapid proliferation of the exchange-traded fund (ETF) industry has been a boon for investors. #-ad_banner-#Many folks now simply focus on a key sector or trend, and buy the most suitable ETF to hit their target. For these folks, the time and energy of individual stock research just isn’t worth… Read More

When it comes to quarterly results, too many companies try to game the system. #-ad_banner-#They tell analysts what they expect to earn in the quarter, and then magically meet or exceed earnings per share (EPS) forecasts every time. Do they have a crystal ball at the start of the quarter and know how results will turn out? Nope.  They simply make a series of accounting adjustments — a booked order turned into a sale here, an expense deferred there — and are able to come up with whatever net income figure they like. (Here… Read More

When it comes to quarterly results, too many companies try to game the system. #-ad_banner-#They tell analysts what they expect to earn in the quarter, and then magically meet or exceed earnings per share (EPS) forecasts every time. Do they have a crystal ball at the start of the quarter and know how results will turn out? Nope.  They simply make a series of accounting adjustments — a booked order turned into a sale here, an expense deferred there — and are able to come up with whatever net income figure they like. (Here are some examples of financial trickery.) Of course, such accounting shenanigans can come back to bite them. You can only manipulate the books for so long until your balance sheet, income statement and cash flow statement become harder to reconcile. Eventually, these companies will have to deliver more realistic financial figures, usually after management has had a chance to cash out of their stock options. Nobody’s forcing you to own such companies. In fact, a pair of exchange-traded funds (ETFs) can help you avoid them — and since accounting tricks never going out of style, these funds are worth a… Read More