Astute Strategist Blog


Market Context

Good Saturday Evening to all,

A hopeful House of Representatives, a disorganized Congress, and new all-time highs ahhh the trifecta of perfection. Over the course of the week, we had President Trump impeached with a marginal vote and it was as if there were no concerns amongst investors and traders. The results came out this past Wednesday the 18th of December, now while this does not remove President Trump from office the key factor will be what happens at the Senate trial set to begin in 2020. As the impeachment vote was expected the markets opened the next day unphased and in fact making yet another new all-time high. Often we are buying the rumour and selling the fact – this time around it was quite inverse.

The S&P 500 closed the week at 3,221 and the Dow at 28,455, now while for the week both the S&P and Dow were only up roughly +1%, the fear of an unknown and big number of 3,200 both came to pass. This bull run is downright impressive but as the level of complacency grows so does my concern that we are in for a surprise move to the downside. I very much doubt it is here to ruin the makings of a Santa Claus rally, that being said the concern is very real. The age-old saying of the trend being your friend is a lovely sentiment but even with their being a shorter week of trading on the horizon, if we are able to get above 3235 on a closing basis then it would appear that this bull has some more room to run. It will be interesting to see where we close the week and decade for that matter with 6 trading days left in the year, it would not be all that surprising if we get some selling toward the last couple of days as there are large gains on the year and reducing exposure as we head into a new decade starting off with an impeachment trial.

Year to date the S&P 500 is up +28.3%, which will make anyone long at the beginning of the year smile ear to ear, in particular, those who favour the Efficient Market Hypothesis which in short says that without inside information it is not possible to beat the market. Now it is no secret to Astute Insiders and those who know me that I am a fan of Apple Inc (AAPL) stock, which year to date is up +76.9%. Even Bitcoin which lost more than half its value from its highs this year is still up +89.77% year to date. In my humble opinion, it is most definitely possible to beat the market and I would only be able to mention the above with such conviction if I shared our performance as well. In 2019 we got long 6 new stocks and have just released our 7th, of the 6, year to date we have a performance of 112.6%, this is not including dividends which all our stocks we buy for long term pay. Click BECOME AN ASTUTE INSIDER below and be on the inside track.

Finally, the team at Astute Strategist would like to wish you all the best for the holiday season and a very healthy, happy and prosperous New Year!