Hedge Funds Waiting for the Next Bear Market

“No  one is more eager for the next bear market than long-short hedge funds,” reports a recent Bloomberg article. These funds, the article explains, are not designed to keep up with the bull market. “Instead,” it says, “their ability to short stocks provides shelter during the occasional bear markets and by extension less volatility and higher risk-adjusted returns than the broad market over time.” Over the last nine years, however, these funds have lagged the… Read More

Shiller: Another Bear Market Could Happen

The kind of panic that ensure thirty years ago, on October 19th, 1987, could happen again. This according to Yale professor Robert Shiller in his recent New York Times article. While Shiller points out that regulatory and technological progress has ruled out an exact repeat of that day, the results of a survey he conducted within four days of the event revealed that “fundamentally, that market crash was a mass stampede set off through viral contagion.” … Read More

In a High Market, Investors Should Prepare for a Downturn

A recent article by Jeff Sommer of The New York Times poses the question: “Is this the top of the market? Is it time to sell?” “Simply put,” writes Sommer, “my answer is this: If you’re a stock investor, be prepared for a major decline, not because one is necessarily coming soon but because no one can predict where the markets are heading.” The article points out that the current economic expansion is the third… Read More

George Soros is Feeding the Bear

In recent years, 85-year-old billionaire George Soros hasn’t done much investing of his own. He has instead focused on public philanthropy and public policy (and is a large contributor to the super PAC backing Hillary Clinton). That changed earlier this year when he began spending more time directing trades at his firm Soros Fund Management LLC, which manages $30 billion for Mr. Soros and his family. Some close to him say that his resurfacing has… Read More

Sonders: Market Most Likely in Post-Echo Bull Phase

Liz Ann Sonders, chief strategist for Charles Schwab, outlines the four phases of the stock market over a full market cycle. Since 1960, the market can be seen following the four distinct periods: recession bear, post-recession bull, echo bear and post-echo bull. Recession Bear: these are the big bear markets, usually lasting a few years and averaging declines of 30%. The 2007-2009 bear market, as Sonders points out, fell by 54% so that was a… Read More

We May Be More Than Half through A Bear Market

Mark Hulbert writes in MarkWatch: “not infrequently, a bear-market declaration often amounts to little more than closing the barn door after the horses have left.” A bear market is typically defined by a 20% or greater decline in stock prices. In the last U.S. bear market (2011), for example, “the early-October day when the S&P 500 fell to 20% below its late-April high turned out to be the day that the bear market breathed its… Read More

A Flat 2015 is Not Predictive of Coming Bear or Bull Market

Barry Ritholtz, Bloomberg columnist and founder of Ritholtz Wealth Management, points out that 2015 has been essentially flat and, looking to history, concludes: “by itself, a flat market does not tell us very much of anything about the following years’ subsequent returns.” He notes that two opposing views are common in predicting markets after flat returns, one bearish (“flattening indicates that markets are setting up for a major correction or worse”) and the other bullish… Read More

Ramsey Predicts 20-25% Bear Market

Doug Ramsey, CIO of Leuthold Weeden Capital Management, predicts a bear market. Although he expressed similar concerns in August, his past calls have been remarkably accurate and not consistently bearish. For example, he correctly called the rally beginning in 2011 and remained an advocate of bullish positions until 2014. “The odds are very high that the top was in May,” he said,”“I think we’re looking at a cyclical bear market.” He predicts the S&P will… Read More

Jim Rogers Sees A Global Bear Market Coming

  Jim Rogers, known for the 4,200% gain he and partner George Soros secured over a decade in the 1970s, told a Barron’s interviewer that he sees a significant bear market coming. “In America we’ve had economic setbacks every 4 to 7 years since the beginning of the Republic and chances are that we’re certainly getting closer to being due . . . and the next bear market is going to be worse than most… Read More