Patrick Iturra Report, EIG Asset Manager
Ever since Russian-Ukraine worries started coming out, the S&P 500 index went into the correction phase on Tuesday, but what should investors do?
During this time, there is a downward trend in the graph. If this is true, the index will come back up and then go down! As per Stuck in the Middle blogger, Mr. Blonde showed the S&P 500’s action in 2018.
Clearly, we can say that the pattern provides some relief after all anxiety among investors during the Mid-March FOMC meeting. There is a market bounce incoming.
Over the past years, the equity market has bounced back after such downturns, along with recoveries from the past year amidst a bear market. There is a lot of evidence for this pullback, as explained by Jon Wolfenbarger, CEO of BullandBearProfits.com.
A veteran analyst who has worked over for equity analyst at Allianz Global Investors had shared his thoughts. I am now more convinced! Among all the evidence stated the list of assets that were currently trading below their 250-day averages, these are bearish signals:
- Global stocks
- Dow Jones Industrial Average
- S&P 500
- NASDAQ 100
- US small-cap stocks
- US Value Line Geometric Stock Index
- US Government Bonds
The record time high stock valuations are also a source for worry! Remember that the big bear market begins just before the recessions hit! The most significant example here is the 1960s and 1970s.
As per his advice, you should buy ETFs when the stock prices tend to fall! With slow economic growth and money supply, that could fluctuate as well! Remember the 2007-2009 S&P pullback that boosted the stocks, real estate, commodities, and defensives.
As for his core advice, he’s doubling down on a call to buy inverse ETFs that rise when stocks are falling, as he notes the 2007 to 2009 S&P pullback swept up stocks, real estate, commodities, and defensives.
To understand this better, we can take the example of the ProShare Short S&P 500 ETF that is designed to work as an opposite of the S & P 500, which rose more than 75%! Similarly, the Proshares Short QQQ ETF rose more than 80%! The other ETFs were designed to move twice the rate – ProShares Ultrashort S&P 500 SDS and QQQ QID ETFs rose more than 1750% & 200%, respectively.
Wolfenbarger looked into all the assets during these and compared stocks and growth; therefore, we will cover everything here!
Many of your investors might be new to the geopolitical tensions today; I recommend that all of you study the 1970s stagflation period. The whole period was not ideal for stock and bond investors.
“Investors can make a lot of money here; there are opportunities that were not there over the last 40 years. You can invest in ETFs for commodities including energy, agriculture, metals & buy contrary ETFs to gain profits from stocks and bonds.”
Rusia and Ukrainian
There are possibilities that the US and Russia might have a summit, as many sanctions trickle out the west! On the other side, Ukrainian officials are more concerned with the national security head, calling it an emergency!
Recently, Lowe’s Low is rising to strong results. The TJX stock is sinking because the results fell short! Also, the Activision Blizzard share went down as the Call of the Duty video game was delayed to the next year!
The stocks SPX DJIA COMP are rising along with Oil CLOO and BRN00 slipping and bonds. Also, New Zealand is increasing as the NZ central bank hiked interest rates for the third time last year!
Chris Weston, pepper tones head of research, argues that catalytic converters/fuel cells are a significant momentum to play along! Now a break could make us witness a bull trend of 2500+! Russia is clear because 50% of the world’s palladium is in that country.
Russia has ventured into the separatist region and sanctions price in! Also, Chris Weston quotes that the energy will remain and the Russia-Ukraine would impact everything! The Risks roll over again as their condition with Ukraine goes intense.
So, what should you do?
The main motive behind this blog is to let you know that there is a big opportunity here for you! You must make the most of it.
Identify, Invest and Gain Period!!
I have been a Strategic Investment Advisor for the past 25 years! I am happy to extend my hand for help.
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EIG Asset Manager, I monitor my investors’ property performance and maximize their real estate income. My job involves leading your real estate investment company’s construction, operations, and leasing teams to ensure optimal value for each asset. FALLOW