Insights on markets, emergent trends, history, innovation, risk management, global economics, strategy, policy, and other topics that catch our attention. Inspired by ongoing research, conversations and events. Written and edited by Osbon Capital Management and published every Thursday morning.
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2024 will bring more positive novel surprises. New years always do. In 2023, it was the dramatic acceleration in AI, which touches nearly every industry, and the early stages of an answer to the obesity epidemic with GLP-1s. Here is a list of what’s on our minds going into 2024.
Do they know something we don’t know?
What can we learn from fund flows – the movement of money in or out of securities? Do the recent outflows (see the Bloomberg article “Fund Outflows Top $75 Billion,”) signal a falling tide for equities, or an opportunity to buy? Or neither? Let’s take a closer look.
Cost is boss when it comes to performance
I often comment on how difficult it is to predict which securities will rise above their peers to deliver higher returns. Frustrating as it may be, there’s just no systematic way to consistently identify winners and losers in advance. However there is one data element, widely ignored by analysts and commentators, that has some predictive value: expense ratio.
Is diversification dead?
Recent violent swings in the equity markets – more down than up – have spawned familiar rallying cries from every corner of the investing world, including “Diversification is Dead!” and “Buy and Hold is Obsolete!” Is it really time to throw out the fundamental tenets of passive investing? John Bogle says No.
Where are the bond vigilantes?
At the department store when a product is perceived as overpriced or of questionable long-term value, sales typically decline. Shoppers vote with their feet and go to a different aisle or a different store. But that’s not happening in the US Treasury market. Even with record low yields and record high prices, bonds continue to move. Where are the bond…
“Why Don’t I Own (More) Apple?”
Pretty much everybody wants to own Apple (AAPL). And why not? AAPL is up 55 times since its March 2003 low of $7 and has greater cash reserves than the US government. Plenty of investors are lamenting that they didn’t take a bite of Apple years ago. But here’s the good news. If you are an indexer, chances are you…
A profoundly positive story for the American economy
Now there’s a headline you haven’t seen recently. It comes courtesy of Marc Andreessen, co-founder of Netscape and general partner of the venture capital firm, Andreessen-Horowitz. What does Marc see that so many others don’t? Find out in his very interesting article “Why Software is Eating the World.”
Markets change. Goals remain.
At times during the last two weeks, it’s seemed that the investment world has been spinning on its head. It can make you feel like everything has changed. But has it? First of all, did your goals change in the last two weeks? Possibly, but probably not. No matter what happens in the stock market day to day, most investors…
Amid market panic, remember your time horizon
All eyes, some red with market fatigue, are on the Dow and other benchmarks. After 10 days of staggering declines, I imagine there are still many investors with their fingers poised on the panic button, ready at the next sign of trouble to get out of stocks. Many have left the party already. Nobody wants to own stocks right now.
Dividends on dividends
Last week, some readers expressed surprise that stocks, as represented by the Dow Jones Industrial Average, had outperformed gold over the last 40 years. In that timeframe gold is up 45x while the Dow rose from 888 to 12,600 – a 14x return. Nice, but not the 53x we attributed to the Dow. What gives?
