Examining past market behavior across the cycle, Citi's Robert Buckland shows how we could be entering a three-year phase where the stock market moves in a gut-wrenching roller coaster fashion, that moderately rises over time.
Citi:
So, if global equities have followed previous cycles remarkably closely so far, what do those cycles say will happen next? Figure 16 tracks the performance of the MSCI AC World benchmark through previous market recoveries. Month zero marks the bottom of the market. We then index 12 months after the low (ie now) to 100. The general message is that global equities surge higher in the first 12 months of a bull market, but in months 12-36 they grind higher — up 13% on average.
One year into a strong rally, we're starting the 'Equities Grind':
(Via Citi, Global Equity Quarterly, Robert Buckland, 7 April 2010)
To embed this post, copy the code below and paste into your website or blog.
• How Maria Bartiromo Became The Most Famous Business Journalist In The World
• Why Maria Bartiromo Quit Her Awesome Job At CNN
• Maria Bartiromo Talks Weight Gain And Living In A Fishbowl
• Maria Bartiromo: Here's Why I Don't Sucker-Punch My Guests With Brutal Questions
Win A Signed Copy Of Maria Bartiromo's New Book
You'll never lose sleep holding gold.
No wonder speculators are freaking out.
The next bear market begins mid-2011.
Panic over Goldman Sachs, the China bubble, and European debt will push gold higher and higher.
Is Goldman a good buy at 9x earnings? Not a chance.
* Copyright © 2010 Business Insider, Inc. All rights reserved. Registration on or use of this site constitutes acceptance of our Terms of Service and Privacy Policy. | Disclaimer
Redesign by Intersect, Inc. | Powered by MongoDB | Hosted by Datapipe | Analytics by Empirical Path
Read Full Article »