There are currently three main drivers that make investing in stock at this moment a good opportunity. The first is the fact that we are entering a rate hike cycle. The second is because the S&P 500 has reached correction territory (a decline of more than 10% from its peak). The third and final reason is because the market seems to be very pessimistic on stocks given the first / second reasons and the conflict between Ukraine and Russia.
Striving to Consistently Outpace The S&P 500 Index
0% Management Fee, Performance Fee Only.
Return On Equity
At Cavallini Capital, we stress the importance of Return On Equity (ROE). No single metric is perfect when evaluating a stock and no single metric can tell an investor if a stock is a buy or not. However, ROE is probably the most consequential metric in terms of evaluating the efficiency and potential growth of how a company invests its profits for long term growth.
Striving to Consistently Outpace The S&P 500 Index
0% Management Fee, Performance Fee Only.
The Importance of Dividends
Dividends have always played an important role for investors. Taking a step back, we can see just how important dividends are for not only growth in investments, but also the health of a company. Automatically reinvesting the dividends produces enormous advantages for the investor.
Striving to Consistently Outpace The S&P 500 Index
0% Management Fee, Performance Fee Only.
Why Do Investors Fear Volatility?
In the investment industry, volatility is seen as enemy number one. The professionals talk about Beta, Delta, Standard Deviation etc. These terms can be confusing and intimidating to not only the average investor, but sophisticated investors as well. The industry has ingrained into people’s heads that volatility is to be avoided and minimized as much as possible.
Striving to Consistently Outpace The S&P 500 Index
0% Management Fee, Performance Fee Only.
2021 Outlook
As you may know by now, I do not spend much time on predictions in the short term regarding the market. However, we have some unique circumstances in the market that could give us some clues to how 2021 could shape out.
Striving to Consistently Outpace The S&P 500 Index
0% Management Fee, Performance Fee Only.
Why March 2020 Created A Once in A Decade Opportunity for Stocks
First and foremost, I hope everyone, and your families are healthy and safe during this tough pandemic.
Financial markets in the month of March not only plummeted but had incredible swings not seen since the late 1920’s and early 1930’s (outside of Black Monday in 1987). These gyrations have caused fear in investors when it comes to investing and/or holding stocks.
