S&P500

Are You Aggressive or Conservative? Better Check Your Beta..

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By: Harvey Sax   A lot of that depends on the beta of your portfolio.  But before we get into all of that, let’s go over just what beta is. Stock Beta is a ratio that indicates how a stock fluctuates with relation to the market.  Beta is an indicator of market risk also called volatility.  When you research a stock, look at the beta to get an idea as to how choppy the returns on this stock will be with relation to the market.  If this doesn’t align with your risk tolerance, this stock may not be for you. … Read more

Pension Pulse: Hidden Burden of Ultra-Low Interest Rates?

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Guest Post By: Leo Kolivakis via Pension Pulse: Hidden Burden of Ultra-Low Interest Rates?.   Matthew Philips and Dakin Campbell of Bloomberg report, Banks Join Pensions in Squeeze as Federal Reserve’s Low Rates Erode Profit:   The Federal Reserve, which cut its target for the federal funds rate to a zero-to-0.25 percent range on Dec. 16, 2008, said last month that rates would remain “exceptionally low” at least through late 2014. While the unprecedented period of near-zero rates is meant to aid an ailing economy, it poses challenges for banks, insurers, pension funds, and savers. The hope is that by making mortgages and … Read more

Chart of the day: Rolling 3-Month Correlation Between Oil & S&P500

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Over the past few years the correlation between oil (especialy WTI Crude Oil) and the S&P500 has been remarkably consistent with an average of about 0.75 (scale from -1 to 1).  However, over the past month that strong correlation that traders had become acustomed to has diminished at an exponential rate.  Over this past month, the rolling 3 month correlation (rolling windows give a much more accurate measure) has fallen to its lowest level since the early 2000s (less than 0.20). Basically, the Energy sector and oil have been moving less in tandem with each other on a day to day basis than they have in years.  Source: Bespoke Investment … Read more