Stock-bond correlation falling, bullish for stocks?

Bloomberg out with a piece on the falling correlation between bonds and stocks.

Pioneer Investments, Security Global Investors and Citigroup Inc. say the broken connection is bullish as the greatest number of S&P 500 companies in a decade post earnings growth. During the bull market from 2002 to 2007 when the S&P 500’s price and profits doubled, the correlation averaged 0.15, data compiled by Bloomberg show.

The article believes that this change derives from a change in investor behavior — no longer are investors buying and selling based on macroeconomic factors but instead are returning to invest based upon profits and prospects.

Could be — the truth though — like everything in life — is probably somewhere in the middle.  The story of a change in correlation here is probably more about the dislodging of the bond market than about a return to proper pricing of equities.

Source: Greed beats fear with stock-bond correlation falling (Bloomberg)

Best investment newsletter resources

Throughout the writing of my book, Tradestreaming, I’ve been asked time and time again if there are any good resources (lists, really) of the top investment newsletters. Unfortunately, there aren’t any all-encompassing sites that investors can tap. This post is a start. Please comment or contact me if you have anything to add, as well.

Top investment newsletter resources

There a couple of firms that market multiple newsletters.  Sometimes, these are just publishing firms that produce different products.  Others, like Forbes, market 3rd part newsletters.

Diversified investment newsletter businesses

InvestorPlace: Philips Newsletters, a giant in the financial newsletter place, uses InvestorPlace as its flagship site to market its newsletters.

StockTwits: More blogs/trading systems than traditional investment newsletters, StockTwits’ store sells subscriptions to the blogs of many of StockTwits’ top investors and analysts.

Cabot: In the business for 40 years, Cabot publishes a variety of newsletters.

MoneyWeek: The UK’s best selling finance magazine also offers a variety of subscription investment letters.

Stansberry Research: Another 800lb gorilla in the financial newsletter space, Stansberry publishes almost 20 different subscription newsletters

Motley Fool: Of course, we couldn’t leave out The Fool — they’re got a stable of about 10 newsletters.

3rd part newsletter distributors

Forbes Newsletters: In addition to the Forbes.com site, the old business mag distributes both their own premium newsletters as well as leading newsletters like Al Frank’s Prudent Speculator and the Obeweis Report.

Financial newsletter directories

MarketWatch Newsletter Directory: Dow Jones’ MarketWatch has a database of many of the industry’s top financial newsletters.

Newsletter Access: This site claims a directory of over 9000 investment letters

Seeking Alpha’s Newsletter Authors: The financial content aggregator has a listing of all its authors categorized as newsletter authors

Investment Newsletter Benchmarking

Hulbert Financial Digest: Mark Hulbert has been following the performance of top newsletters for heaven-knows how many years.  He publishes a newsletter himself of his findings on which newsletters exhibit top performance — and which don’t.

Investimonials: Users submit their own rankings on many of the industry’s leading investment newsletters.

Crowdsourced Trading Strategies

Zignals: Not sure why more people don’t know about this Irish firm but they allow users to publish trading strategies and investors to subscribe to them.

Academic Research

The Equity Performance of Investment Newsletters

Herding Among Investment Newsletters: Theory and Evidence

Market Timing Ability and Volatility Implied in Investment Newsletters’ Asset Allocation Recommendations

The Performance of Investment Newsletters

How to Start an Investment Newsletter

NewsletterGrowth: This is a shameless plug for a site that I’m incubating that really helpful for investment newsletter writers/publishers and people thinking about getting into the business to maximize their writing, marketing, and monetization of their investment newsletters.  Check it out — there’s also a 20+ page ebook about how to start an investment newsletter.

What to do next

I’ve got a lot more interesting stuff to share: weekly tips, updates, special offers, etc.  Make sure you sign up for my free mailing list here.

The TRUTH of insider trading a la Joshua Brown

I liked Joshua Brown’s Insider Buying/Selling: The Collected Wisdom of a Thousand Heartbreaks (see it also posted at the CSMonitor with the toned-down title: ‘Debunking Myths…’)

There has been a lot of talk during this rally that the insiders — in the aggregate — were selling stock all the way.  The Pragmatic Capitalist has done a good job following this trend of insider selling.  In Brown’s piece, he lists 10 things he learned about insider trading — all gross generalizations, but interesting nonetheless.

My favorites?

2. Technology executives would rather be locked in a dark basement, listening to Billy Joel’s Uptown Girl on an endless loop, than make an open market purchase of their own stock.

And

9.  I avoid the stocks of executives who go on TV and speak promotionally while dumping larger-than-normal blocks of their own stock.  This is because I’m street smart and Street smart.  It’s not always the right thing to do, but I sure feel better.

As I’ve written repeatedly here and in my book due out in June, insider buying/selling is more useful when trying to size up individual stocks than the market in general. 

Amen, Josh.

Investment newsletters REALLY bearish — time to buy?

Wow! Expectations that U.S. stocks will drop at least 10% has risen to the highest levels since April 1984.

In a recent survey of investment newsletters by Investors Intelligence, Bloomberg reports that:

The following are results from Investors Intelligence’s
analysis of investment newsletters for Jan. 27 through
yesterday. The company determines the proportion of writers who
are bullish and bearish on U.S. stocks, as well as the
percentage who anticipate a correction, or 10 percent decline,
in the market.

           This Week   Prior Week    Comments
Bullish      38.9%        40.0%      Lowest since July 21
Bearish      22.2%        23.3%      Lowest in two weeks
Correction   38.9%        36.7%      Highest since April 1984

Time to buy?