20 November 2017: Filter bubble

Filter bubble (a):

The stock market’s ‘split personality’ could set off a correction at any moment. — CNBC
Stock Market More Correction Ahead? — The Market Oracle
JPMorgan Chase Is Worried About the Stock Market. — Motley Fool
Watch For Signs Of A November Correction. — Forbes
Today’s apparently calm market disguises a rapidly brewing storm. — The Globe and Mail
If bonds are right, a steep equity correction is underway. — FXStreet
Wall Street bull warns a major pullback is near, and here’s what could spark it. — CNBC
‘The Great Crash of 2018’ will start in bond market. — RT.com
Has The Plunge Begun? — Seeking Alpha

Filter bubble (b):

Rally on! Here’s why the stock market has at least another 10 percent to go. — CNBC
Why You Shouldn’t Worry About a Correction. — Daily Reckoning
Relax, the stock market’s end isn’t nigh. (You’ve got a year or so) — The Globe and Mail
There will probably be a pullback, but it won’t ruin the bull market… — CNBC
Bull Market Can Keep Going, Says Kleinwort Hambros — Morningstar
Why rate hikes won’t endanger this bull market. — Interactive Investor
Stock bull market far from over. — Reuters UK
Experts upbeat on stock market, economy in the year ahead. — InvestmentNews

Are you living in one of these filter bubbles? Then this could be a good time to step out of your filter bubble / echo chamber / comfort zone, and to stop reading content that reaffirms your view — it might enlighten you.

 

white-chapel-logo-smallThe S&P 500 and the Dow pulled back last week, losing their upward momentum as uncertainty surrounding tax reform prospects kept investors on guard. The S&P lost 0.26% on Friday, the Dow 0.43%. For the first time since August, both indices posted a two-week losing streak. The S&P 500 closed with a weekly loss of 0.13%, the Dow closed 0.27% lower for the week. The NASDAQ struggled on Friday (-0.15%) but managed to end the week higher with a gain of almost 0.5%. Volatility stayed at a higher level than average during recent weeks. The VIX didn’t see single digits territory last week, hovering between the level of 11 and 12 points, with the exception of Wednesday, when a short-lived spike pushed it above 14 points. The VIX closed Friday at 11.43 points, only marginally higher (1.2%) than the week before, but down for the day: -2.8%. UVXY ETFs took another step back because of this: -3%. XIV ETNs gained 1.6%.
Danny Daredevil stepped back a bit further Friday. His RSS now stands at 29%. Last Wednesday, it seemed he had shaken off his negative ‘Quarter-To-Date’ return, but apparently his time (still) hasn’t come yet. Easing volatility on both Thursday and Friday caused his QTD to slide back into the red: -7%. Adventurous Anny is still holding a cash position, so her RSS remains at 15%. Solid Suzy and Lazy Larry did well Friday. Their RSS rose with almost three percentage points, to more than 64%.
None of our models gave a trading signal at the end of Friday’s session. Due to a change in market momentum, a trading signal is now further away than last Monday, when we reported ‘there may be one just around the corner’.

Model Holds Start date

RSS

YTD

QTD

AAR

Danny Daredevil UVXY 1 January 2016

29.11%

-67.97%

-7.33%

15%

Adventurous Anny Cash 6 March 2017

15.37%

15.37%

6.34%

23%

Solid Suzy XIV 6 March 2017

64.52%

64.52%

12.47%

103%

Lazy Larry
XIV 6 March 2017

64.52%

64.52%

12.47%

103%

RSS = Return Since Start | YTD = Year-To-Date | QTD = Quarter-To-Date | AAR = Average Annual Return

 


Meanwhile in Japan

Sandan-kyō. The sign at the entrance of the gorge says: “Special Place of Scenic Beauty. Sandan-kyō is a gorge formed of approximately 16 kilometers of rhyolite and granite, spanning from Shiwagi to Hijiriko and Yokogoguchi. If the land protrudes, erosion by the river creates a waterfall at the tip of the valley. When the waterfall retreats upstream, a deep ravine is formed, and a waterfall appears at the boundary with a branch that has less carving force. At the upper stream of Nidandaki and Sandandaki are many waterfall groups which are still retreating, and a grand revine [sic] is formed at the downstream, with 40 degrees of inclination and 600 meters of height.”
To read the last sentence of this text before you start the long climb, is one thing. But to really grasp just how it feels to stand at the edge of a ravine ‘with 40 degrees of inclination and 600 meters of height’, with not much of a fence between you and the abyss, is quite another!