Tag Archives: stock market update

February 2012 Stock Market Update

Posted February 2, 2012 by admin. tags:Tags: , ,

Paragon Wealth Management’s investment advisers give their thoughts on what happened in the stock market in January and what they think will happen going forward.

Stay tuned next week for the rest of Dave Young’s article “Volatility Unleashed”.

Disclaimer
Paragon Wealth Management is a provider of managed portfolios for individuals and institutions. Although the information included in this report has been obtained from sources Paragon believes to be reliable, we do not guarantee its accuracy. All opinions and estimates included in this report constitute the judgment as of the dates indicated and are subject to change without notice. This report is for informational purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of any security. Past performance is not a guarantee of future results.  

The Probability Of A Recession

Posted October 21, 2011 by admin. tags:Tags: ,
Rolling the dice

Written by Dave Young, President of Paragon Wealth Management

So are we going to have a recession or not?  Every time the market drops a thousand points it seems as though stocks are priced as if there is going to be a severe recession. Listening to the commentators you would think the world was going to end any day.

As we have mentioned repeatedly over the past few months, the indicators that we track haven’t shown a high probability of recession. We don’t discount the fact that we may end up in another recession but up to now the high level of pessimism is not consistent with what our indicators are showing. This is in contrast to the endless interviews of advisors proclaiming that the next recession is just around the corner.

In the update we received today from Ned Davis Research much of the data they present doesn’t indicate an imminent recession either. As a matter of fact, some of the data looks more promising than it has since the sell off started last summer. Below are some of the statistics they sent us in our update.

The Philly Fed’s general business index surprised economists with a big positive jump of 26.2 points to 8.7. It was the biggest increase in 31 years and the 4th largest on record. Optimism about the future also improved.  The future activity index rose to its best level in six months.

The conference board’s Leading Economic Index (LEI) rose 0.2%, up for the fifth straight month.  The CEI rose 0.1%, as all four of its components picked up.  According to the Conference Board, all composite indexes suggest “the expansion in economic activity should continue, but at a modest pace in the near term.” Overall the Board sees about 50% chance of recession in the next six months.

The Ned Davis Research Economic Timing Model rose to +16 from +12, which is historically consistent with moderate growth. Overall, the indexes were mixed but the positive news on the Philly Fed’s General Business Activity Index was very interesting.

Disclaimer
Paragon Wealth Management is a provider of managed portfolios for individuals and institutions. Although the information included in this report has been obtained from sources Paragon believes to be reliable, we do not guarantee its accuracy. All opinions and estimates included in this report constitute the judgment as of the dates indicated and are subject to change without notice. This report is for informational purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of any security. Past performance is not a guarantee of future results.

From Bear Market Territory To Market Rally

Posted October 13, 2011 by admin. tags:Tags: , ,
Fall Colors in the Utah Desert

Written by Nathan White, Chief Investment Officer, Paragon Wealth Management

The markets have moved up about 12% from the low on October 4th. That’s a huge move for one week! If you were paying attention to the headlines you probably missed the rally, but that’s been the nature of the market for the last two months. Twelve percent is what people used to expect in a decent year from equities! Trying to trade this market has been very painful to a lot of people.

Just as sentiment got really bad and the market dipped into bear market territory what did the market do? Go up. The market rallied as the Europeans started to talk the right talk and the prospect that corporate earnings will be relatively resilient. Now it comes time to walk the walk. The rally has been on light volume and from short covering which means it could be just short-lived. What is crucial now is to hold these levels near the upper end of the range.  That will depend mainly on the Europeans actually implementing actions to deal with their sovereign debt problem rather than just talking. It will also depend on corporate earnings holding up for the most part in terms of results and forecasts. If we hold these levels we could have a nice fourth quarter to end the year. The set-up is forming now will see how the follow through goes….

Disclaimer
Paragon Wealth Management is a provider of managed portfolios for individuals and institutions. Although the information included in this report has been obtained from sources Paragon believes to be reliable, we do not guarantee its accuracy. All opinions and estimates included in this report constitute the judgment as of the dates indicated and are subject to change without notice. This report is for informational purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of any security. Past performance is not a guarantee of future results.

A Doom Boom?

Posted September 2, 2010 by admin. tags:Tags: , , ,
Storm Coming


photo by eflon

Written by Nathan White, CFA

I think the current sentiment about the investment environment and the economy is about the worst I have ever seen.

It seems nearly impossible to find anyone that is optimistic! It amazing how the media exaggerates the slowdown in economic data to mean Armageddon.

Every time I look at something like the Drudgerport, I see someone new coming out with a book on how to profit from the coming depression or market crash. Even political pundit, Dick Morris, has a book like this out!

Now, I’m not a rabid bull, nor do I believe that there aren’t concerns and real risks out there. I just wonder how much has already been priced into the market, and that is always the trick with investing.

Investor actions have been confirming their negative view as seen by the record amount of money just piling into bond funds at historically low interest rates.

Do people buying the 10-year Treasury at this price realize that a one percent increase in interest rate could mean a 9-10 percent loss on their investment and take about four years just to “break even” with interest payments; and this is a “risk-free” investment?

Longer-term bonds would produce even worse results!

A report that came out the other day that said hedge fund managers indicated that just 17 percent were bullish, and around 47 percent were short ahead of the historically bad month of September. Perhaps September came a month earlier in the form of August this year?

I’ve been in this business just long enough now to see what happens when everyone is thinking negative and have positioned themselves in the same manner; the market likes to do the opposite.

I agree that things are not great, and the recovery has been so-so. It should have been better, but we are by no means in a depression.

Instead we are feeling the consequences of government bail-out and intervention in the economy in the form of limited upside growth. It is just simply impossible to grow very robustly when the government is creating so much uncertainty and making it harder for businesses to conduct business.

Bail outs and government interventions in the market may help to put a temporary floor on a market slide or economic downturn, but only the cost is giving away the upside later on. This is what we are feeling now.

This produces a Jekyll and Hyde environment where some things look good and others bad, which results in a great degree of uncertainty and markets that bounce around. Choppy markets can be very hazardous to investors’ health as it produces a lot of buy high, sell low activity.

The current economic conditions seem to resemble the early 80’s with few opposite ironic twists. Instead of interest rates at extreme highs, the current rates are at extreme lows and the economic approach of the Obama administration is the “opposite” of what the “Reagan” was. We’ll see how this shakes out…

Paragon Wealth Management is a provider of managed portfolios for individuals and institutions.  Although the information included in this report has been obtained from sources Paragon believes to be reliable, we do not guarantee its accuracy.  All opinions and estimates included in this report constitute the judgment as of the dates indicated and are subject to change without notice.  This report is for informational purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of any security.  Past performance is not a guarantee of future results.

Stock Market Update

Posted November 20, 2009 by admin. tags:Tags: , ,

Below is a short 5 minute video. Dave Young, President of Paragon and Nathan White, Paragon's Chief Investment Officer, discuss what has been happening in the stock market.

Paragon Wealth Management
is a provider of managed portfolios for individuals and institutions. 
Although the information included in this report has been obtained from
sources Paragon believes to be reliable, we do not guarantee its
accuracy.  All opinions and estimates included in this report
constitute the judgment as of the dates indicated and are subject to
change without notice.  This report is for informational purposes only
and is not intended as an offer or solicitation with respect to the
purchase or sale of any security.  Past performance is not a guarantee
of future results.

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