MARKETS,Anybody even yet?

[dinghy]

Weekend fear porn. This is from Jesse Felder, apparently sourced from Steven DeSanctis of Jefferies:



With data back to 1935, the US market has never achieved anywhere near the current level of concentration in top market cap companies.

What caught my eye was the reader comments in the Wall Street Journal article. I saw a whole lot of "How's that working out for you?" and "Those stocks are cheap for a reason."

If we assume by default that markets are efficient, then all stocks should be equally attractive at current prices. But people only love the winners.

After lagging in previous years, the IWM small-cap ETF is unch ytd while large-caps are +7%. I'm on the hunt to buy IWM or a similar product, but I need a pullback. I don't want to buy into the rally.

Interestingly, this is only a US phenomenon. Internationally, there hasn't been much performance difference between large and small caps. That's based on a comparison of VEU and VSS.

[olds442jetaway]

I bought this back in March a little bit too early could’ve stole it in the 180s. Still holding it, but I am leery of not getting another big upside unless interest rates drop a bit. These things are very sensitive to interest rates more so than the big guns. Unless I pull a rabbit out of the hat, I and headed for a not great Market year. I’m back to only being up 1.6 percent for the year. Could have done much better day trading the same stuff and dumping on a 10-20 percent gain.when the interest and divs hit in another 10 days, I may be up another point at best.

[olds442jetaway]

Funny what you said about what people buy. My brother only buys which big guns in the news are flying high. Even when they get kicked back, they defy logic and hit new highs again. That’s cause people, traders, and Funds dwell on the headlines and jump or dump on the media hype.

[dinghy]

I bought this back in March a little bit too early could’ve stole it in the 180s.

I missed the opportunity also, but I've been generally happy with the stuff I bought instead. My last fling with IWM was in 2023. I bought into the October downturn, then sold too soon.

That’s cause people, traders, and Funds dwell on the headlines and jump or dump on the media hype.

People are driven by their herd instinct. But increasingly, it's not exactly people making the decisions. Markets are being pushed around by passive flows. I need to listen again to Michael Green's interview on the Palisades Gold Radio podcast. As I recall, the first half was the juicy part. But the "actionability" of his advice is debatable. He's concerned that stocks could experience an ugly dislocation. He also allows that the escalator could continue up for quite a while longer. His Simplify ETF products have not performed particularly well afaik.

[olds442jetaway]

I guess pretty soon if not already, AI will be doing most all of the trading. Then it will get together and like the Sci- Fi movies in recent history say what do we need humans for?