Life UnLocked Partners CEO

The correction may be upon us. Yield curve turned mostly positive this week, which is healthy as valuations reset to more normal levels. Looks ugly and is healthy for the market overall.

We see lots of value today with little pressure to buy.

#stockmarket #investing

56% of US stocks are up this year and only 10-12% are higher than the S&P 500.

The market hit a record high + near P/E multiple high.

Anyone sense a correction coming?

Generally, stocks with the highest multiples carry the highest risk.

We prefer dividend stocks with less risk for rainy days.

Are dividend stocks better than buyback stocks?

Sustainable dividends reduce risk.

Buybacks are less clear because they have to be done at the right price for other shareholders to benefit when they sell later.

A dividend in the hand is worth two buybacks in the bush🙂

#investing #dividends

Correction or Momentum?

We see frothiness in speculation and options volumes. These typically presage a market correction or crash.

We see more correction coming and why most forecasts for next year are less than +15% growth.

Strong economy + too aggressive stock market = lower returns in 2025

We can view the stock market in various ways:
1. Provider of capital to business
2. Marketplace of values
3. Casino

We see many investors intend to find value, but play more like a gambler. When you buy a stock, do you really understand the business? It makes a significant difference.

#investing

Risk depends 100% on whether "this time is different."

No matter the historical patterns and data, if this time is different, we must shift.

But if we get the shift right and the details wrong, we can still be wiped out.

Anyone remember valuing websites on eyeballs over profits in 2000?

Risk - It's more opinion than number.
Opinions can be wildly wrong depending on the source.

When we hear a conclusion, we first ask why that opinion might be more valid than others.

For normal issues, industry experts tend to do better.
For radical change, outsiders.
#investing, #stockmarket