Cash Poor

ByBrad Lamensdorf

Cash poor investors in September reduced their cash cushion. The latest AAII survey shows that individual investors in September reduced their cash cushion by quite a bit. They’re now holding only 14.6% of their portfolios in liquid instruments, among the lowest in 30 years. They’re not the only ones. Looking at other market players, it’s…

You’re Being Robbed of Trillions with Low Interest Rates, and Don’t Even Know It…

ByBrad Lamensdorf

By John Del Vecchio “This article originally appeared in The Rich Investor” Central bankers are the biggest crooks on the face of the earth. John Gotti and Pablo Escobar are practically saints in comparison. Here’s the thing… Central bankers are keeping interest rates low. In many cases, they’re negative. This trend is expected to last…

Investor Sentiment Gauges Warning Stock Market is in Danger Zone

ByBrad Lamensdorf

We use investment sentiment as a contrarian indicator of where the stock market is headed. This past week we had increased investor optimism. This means the stock market has become very risky. In fact, the Bulls/Bears poll of newsletter writers and editors suggest the stock market entered the danger zone. Bullish sentiment among these writers,…

Growing Investor Optimism on Stock Market Continues to Raise Red Flags

ByBrad Lamensdorf

We use investor sentiment as a contrarian signal on the direction of the stock market because historically investors have been wrong.  The Red Flags caught our attention when bank of America this past week released a survey showing large investors have become 17% overweight on U.S. equities. That’s one of the most aggressive position in…

Smart Money Index

ByBrad Lamensdorf

As Babak pointed out, the Smart Money Flow Index appears to be making a “divergence” with the stock market. This happened in 2018 as well, before stocks cratered.  *The Smart Money Flow Index assumes that the “smart money” trades in the last hour of each session and the “dumb money” trades in the first half hour of each…