Seana Smith and I go back over 5 years. She used to book me on After The Bell at Fox Business. Now she is in the driver’s seat hosting Yahoo! Finance’s morning show Market Movers. We covered a few key topics, but all we really want to know is where the market is heading. Spoiler alert: over time it goes up.
The cold reality is that after months of quite markets, big Wall Street firms are seeing a big drop in trading revenues. So what is a pig to do? Well, if you have no material fundamental damage to the market, just tell people is has to go down or get more volatile because it hasn’t in months. Is that how you want to manage your money?
Our firm took a more realistic approach in which I outline in this interview. We rebalanced and took profits from the last 9 months. This period had significant gains in certain assets classes, especially international stocks. If we get a mild pullback (my opinion, but who cares) or a correction (the fear Wall Street is peddling), we have fresh capital to reinvest.
Just remember that the big dogs out there aren’t selling stocks, they are hedging their portfolios using complex and costly derivatives to try and make some money while the market goes sideways. Let them have their side game all to themselves.