2020 • The Mad Hedge Fund Trader - Insights

Very interesting, thanks!

He’s certainly madly optimistic! I get all excited when I read his tips… I need to balance that by going back to look again at the forecasts from people at the other end of the optimism spectrum, like Rob Arnott’s Research Affiliates who are forecasting negative real returns for US equities over the next ten years (their model is calling for -0.3%). How are we little guys to know which guru to follow?

I do find some of what John Thomas says convincing in areas like tech, e-commerce, and non-fossil-fuel energy, and I am buying in those sectors. I’ll need to look into his arguments on banks more before I am convinced there, though – with interest rates headed for sub-zero, I don’t see how banks are supposed to make a living, though I admit I haven’t done my own research on that. As for the rest… not sure!

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The link indicates over 5% returns for equities from the UK, Spain, South Korea, Russia, etc :slight_smile:

Oh, yes, Research Affiliates are rather bullish on the rest of the world. But they are very negative on the USA, while ‘Mad’ John is fleeting about a ‘new American Golden Age’. I think the contrast is ‘interesting’. I’m sure they both think they’re right, but one of them isn’t!

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I see an option for both to be correct:
Industrial & cyclical firms such as banks and car manufacturers rally but tech does not.
This would case the the Dow Jones to rally (excluding tech firms like Apple) wilst the Nasdaq does not. Also, as the FTSE and other European Indices (Dax, Ibex, Cac, etc) are heavily weighted towards cyclical and manufacturing stocks, particularly financials so could rally heavily. Also, I seem to remember that european banks have currently got lower P/E multiples than banks from the USA.

Any thoughts on this?

I am not saying that it will happen, but just that it is a option that might fit in with both hypothesis somewhat. It would still result in USA markets rallying overall, but it would lead to lower rises compared to european stocks.

You heard it hear first

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Stock market strength is building

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Tonight’s insights

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He seems bullish on Visa.

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I’m just surprised that contactless wasn’t a a big thing in the USA until covid19
I had a friend come over the previous summer and they were amazed when I bought a round with a quick tap

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I can confirm contactless payments were not rly a thing in the USA until covid.

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UPDATE: these insights expire once new insights are issued, so you can not re-read them once a new batch of insights are released.

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(October 14 Biweekly Strategy Webinar Q&A)

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He is a bit obnoxious but great insights :rofl:

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So backwards with dip and swipe there until Covid.

So he is bearish on the S&P for the next month?

I thought he was bullish on cyclic stocks…

If anyone understands please explain :slight_smile:.

A bit contradictory given his commentary

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I was of the understanding he suggested US banks are looking good value - should your time horizon be much further in the future.

Mixed thoughts

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The Market Outlook for the Week Ahead, or Why the Next Two Weeks are a Write-Off

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