What do junk bonds (JNK), high yield corporate bonds (HYG), small-cap (IWM) and biotech stocks (IBB) have in common? Answer: they represent part of a risk-based system that should be monitored, short, medium and long term as part of your toolset. We monitor these instruments daily.
Investors should monitor these asset classes when planning for retirement and the intermediate term trend.
Junk Bonds JNK, Small Caps IWM, Biotech IBB Risk Monitors
The indicators are all moving higher pointing to a bullish market short, medium and long term. Once short-term changes in December suggested entering equities again, the medium and longer-term trends improved.
Add crude oil (USO) and NYAD, the NYSE advancing vs. declining stocks index to round out your toolset. When one diverges, watch the others closely. Specifically, if bonds dropped suddenly its time to assess your risk. Monitor your positions and take risk off as necessary.
Being invested when markets are in your favor will make a huge improvement in your performance over time. Moving your positions to cash assets and/or adding to short positions/hedges when these indicators turn, as they did in October, will have an added benefit of helping you avoid major losses.
Futures are higher on China US trade developments. SPY (+1.44 pts).
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Our content is intended to be used and must be used for informational purposes only. It is very important to do your own analysis before making any investment based on your own personal circumstances. You should take independent financial advice from a professional investment advisor in connection with, or independently research and verify, any information that you find on our Website and wish to rely upon, whether for the purpose of making an investment decision or otherwise. Trades and or positions listed and taken from the watchlist are my own and should not be considered “advise” to enter any particular position or asset.
We would like to draw your attention to the following important investment warnings. The value of shares and investments and the income derived from them can go down as well as up; Investors may not get back the amount they invested – losing one’s shirt is a real risk; past performance is not a guide to future performance.
Live broadcasts are educational in their content. Proper risk management is considered on every trade or asset mentioned.
*** Stocks highlighted are for information purposes only and should not be considered as advice to purchase or to sell mentioned securities.
As always, the use of technical and fundamental analysis is encouraged in order to fine tune entry and exit points to average seasonal trends.
These mentions are stocks that we may or may not decide to trade as outlined in the watchlist. Always use a stop.