A Sample of November’s Edition of The Big Picture

By Stephen Sutherland, author of Liquid Millionaire.
Posted in the Category of ISAS, SIPPS, Investing, Stock Market on 6th November, 2011.
Tags: bull market, institutional investors, isaco, liquid millionaire, market health, market indexes, nasdaq composite, russell indexes, s & p 600, stock market, stock market summary.

A Sample of November’s Edition of The Big Picture

In last October’s edition of The Big Picture, I made a bold statement contrary to what most so called experts were saying about the market.

I said:

“Even though September has been a horrible month for investors, my take on the market still remains the same. My research and analysis tells me the correction we are in right now is a healthy bull market correction.”

It’s still too early to say if I was right because the correction is still in play and it will only be over when the market indexes hit new highs. However, my view still remains the same – we are in a healthy bull market correction. A month ago the common view from market pundits and financial media was that we had entered a new bear market. However as the market keeps climbing higher, more and more red cheeked individuals are putting the term ‘bear market’ back on the shelf.

ISACO’s new business team report back to me how people are ‘feeling’ about the current market environment. I get this feedback on a daily basis and it’s very puzzling to us when we hear from individuals who have firm beliefs that the market is currently doing much worse than it was back in 2008. Because these people unfortunately watch too much TV, believe everything they read in the newspapers, and don’t look at charts to see what’s really going on, they convince themselves that the market has been going down over the last few years – which of course is totally false.

Charts, especially long-term ones are extremely helpful to look at because they give you a great idea on how healthy the stock market is. As you will see in November’s edition of The Big Picture, the market is doing much better than most would have you believe. And even though year to date my portfolio is showing a -15.3% loss, I’m confident that by the end of the year this loss will be lessened. If the market is as strong as I think it will be over the next two months, my current loss will probably turn into a small gain.

I expect the last two months to be strong because we are just entering the three strongest market months of November, December and January. I also believe that many fund managers who missed the recent three week super rally are now waiting for a pullback so that they can ‘get in.’ I’ve heard many investors mention this ‘waiting for a pullback’ to enter on financial stations such as CNBC. However, the market might not pullback at all. What are they going to do then?

I see my current year to date loss of 15.3% as normal and natural. In 2009, I managed to make a return of 56.3% and in 2010 27.2%. When you look at things in a ‘big picture’ view, making close to 100% in two years, pulling back 15% appears perfectly rational. Remember the stock market does not go up in a straight line. Instead you take a few steps up and then you take step back. It’s a long-term game. People who focus on short term performance are totally missing the point.

Please remember, past performance is not a guide to future returns. The value of investments and the income from them can go down as well as up and you may not get back the amount you invested.

Until the next time my friend.

If you like how I think you might like the idea of shadow investing me. Shadow Investing is a new concept that allows you to get almost identical returns to the ones I get.

To find out more about Shadow Investing click here.

Would being able to have a conversation each and every day with me to ask what I’m invested in so that you could copy me? Imagine, when I quickly swoop in on opportunities to profit, you could too!

Today you can take a sample of my take on the market for free, without obligation and make up your own mind.

You can take a look at The Big Picture, November Edition or if you prefer you could look at ISACO’s 2011 ISA Guide.

That means if I get a 12% annual return, so do you.

You can email us or call 0800 170 7750 if you prefer.

If you do contact us you are under no obligation to do anything, buy anything or sign up for anything.