HORAN Capital Advisors

Entries for 2015

Buyback Strategy Continues To Lag Broader Market Return

 October 1 2015     David Templeton
Although S&P Dow Jones Indices reported second quarter 2015 buybacks declined 8.7% versus the first quarter of 2015, the twelve month total increased 3.8% versus the prior twelve month total that ended June 2014. As the below chart shows, this reduction in buybacks on a quarter over quarter basis might be tied to the declining trend developing in as reported earnings (blue line.) In spite of the d...

A Few Positive Equity Market Technicals

 September 26 2015     David Templeton
The equity markets have been anything but kind to investors long stocks. Nearly all the broad market equity indices are in negative territory for the year. The S&P 500 Index: -6.2%, Dow Jones Industrial Average: -8.5%, S&P MidCap Index: -4.4% and the S&P SmallCap Index: -4.6%. Simply reviewing social media comments from investors, one could be lead to believe the market has no where to go but down...

The Fed Is In A Pretty Tight Corner On Future Of Rates

 September 18 2015     David Templeton
So the Fed did not raise rates yesterday. To some this seemed to be a surprise; however, as we noted in our post a few days prior to the announcement we believed global economic factors could play a part in the Fed's rate decision. In fact, Janet Yellen cited issues in markets outside the U.S. as one reason for not moving on rates. Additionally, inflation in the U.S. remains well below the Fed's 2...

Fed Rate Decision More About The Economy Than The Rate Itself

 September 16 2015     David Templeton
Probably the most discussed potential Fed decision on rates is the one forthcoming on Thursday. When it is all said and done, the rate increase in and of itself is really not the issue investors should factor into their investment decision. As we have pointed out in prior posts, higher rates have mostly been a positive for stock returns. A primary issue is the state of the economy, both in the U.S...

A Potentially Weakening Consumer And The Fed's Predicament

 September 12 2015     David Templeton
One aspect of the market's recovery since the financial crisis has been the strength of the consumer discretionary sector. Within the sector itself the retail industry group has outperformed both the S&P 500 Index and the overall discretionary sector itself. This strength could not occur over this long of a period without an improving consumer. The second frame in the below chart, however, shows t...

Bullish Technicals Forming In The Midst Of The Correction

 September 10 2015     David Templeton
As is typically the case when the market is attempting to form a bottom, positive technical signs can be difficult to uncover in the midst of the bearish chatter. This time seems to be no different and the key is whether potentially positive technicals can win out in the face of some weakening fundamental factors.The below chart shows the daily price action for the S&P 500 Index along with several...

Market Timing Risk

 September 5 2015     David Templeton
Market timing, i. e., when attempting to trade into our out of the market, is a difficult strategy for nearly all investors. A Barron's article written in October of last year, The Timeless Allure of Stock-Market Timers, highlighted a few strategists' ill-timed calls and their confusion on why it did not work. The worst part of market timing is the fact the timing of getting out tends to occur nea...

Rising Interest Rates Historically A Positive For Equity Returns

 September 3 2015     David Templeton
The upcoming two day Federal Reserve meeting that concludes September 17th seems to have investors on edge. The million dollar questions is whether the Fed will raise rates or not. If one is a stock investor, they should hope the Fed raises rates and puts this extended anticipation to rest. Another reason investors may want to see the Fed raise rates is due to the positive impact a rate increase h...

Death Cross More Of A Buy Signal?

 September 2 2015     David Templeton
With the recent weakness in the equity markets, many stocks' and stock indices' chart patterns have traced out a death cross pattern in their moving averages. The Death Cross is a technical indication when the 50 day moving average crosses the 200 day moving average from above. As Michael Batnick of The Irrelevant Investor blog noted a few days ago, very few technical analyst use the death cross p...

Stocks Higher 10-Years From Now

 August 30 2015     David Templeton
Before the onset of the market weakness in the early part of last week and the end of the prior week, S&P Dow Jones Indices released a report highlighting rolling 10-year annualized returns for the S&P 500 Index. The report seems prompted by a response Warren Buffett made to a question on timing the market. Buffett noted he was not a market timer and simply responded, "Stocks are going to be highe...
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