Pigs Gets Slaughtered
By Brad Lamensdorf
“Bulls make money, bears make money, pigs get slaughtered” is an old market saying. Right now, market sentiment is way too greedy.
The chart below shows the recent history of the CNN Fear & Greed Index. After surging over 80 (Extreme Greed) the index is starting to roll over and hit 72 on November 19th. The bull phase in the short-term may be over and pigs are about to get slaughtered.
Now represents and good time to pare back risk and add to hedges.
To learn more about how these indicators can help manage risk in your portfolio, book a call with Brad.
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Downside deviation is a measure of downside risk that focuses on returns that sell below a minimum threshold of a Minimal Acceptable Return (MAR).
Sharpe ratio is the average return earned in excess of the risk free rate per unit of volatility of risk.
Time to recovery is the duration of time it takes to restore the value lost.
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Annualized volatility – Historic volatility measures a time series of past market prices. Implied volatility looks forward in time, being derived from the market price of a market-traded derivative (in particular, an option).
Max drawdown is an indicator of the risk of a portfolio chosen based on a certain strategy. It measures the largest single drop from peak to bottom in the value of a
portfolio (before a new peak is achieved).
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