I have focused most of my stock market comments on the US stock market. Why? Since the GFC of 2008 which originated in the USA; money managers and investors had to do one choice. Allocate 100% of their equity exposure to the US stock market, in particular to the Nasdaq...
The US stock market remains the undisputed driver of the rally. However, as highlighted in previous posts, I tend to believe that we are in a derivative bubble du to the massive increase in trading volumes. Somehow cash market price action has become a derivative of the derivatives but the...
In "Something seems to have changed" , I highlight the "commodity like behaviour" the S&P 500 index seems to have "adopted". Among the many charts I follow, here is one which shows the relationship between the SKEW index and the Equity PUT/CALL ratio. The SKEW index is a measure of potential risk...
The following chart is a bit mind-boggling. I have used Excel to draw it and since numbers do not lie, they require some thoughts to try making sense of the situation. The blue line is the S&P500 index since 1980. The red line is the 21 days volatility processed by...
