5 Things To Ponder: Variegated Contemplations

“Twas the week before Christmas, when all through markets

Not a trader was stirring, because they already left for the Hamptons.

Which left  the “inmates running the asylum” with very little care

As everyone hoped a ‘Santa Claus Rally' would soon be there.”

Yes, it is that magical week leading up to Christmas and the subsequent low volume push into the new year. For individuals, it is “magic time” as hopes are high that “Santa Claus” will come to WallStreet.

Of course, as mutual funds window dress portfolios for the end of year reporting, it tends to elevate the most popular stocks in the markets. However, investors should also be wary of the rotation of the calendar as those same managers then sell positions for tax purposes in the New Year.

This weekend's reading list is a smattering of articles that cover a wide range of topics from to oil. As always, I try to provide opposing points of view to give readers a complete picture of the topic. As a portfolio manager, it is important to remember that our fundamental beliefs can lead us into making poor investment decisions. Therefore, it is crucial for long-term investment success that we eliminate the emotional biases that affect our decision-making processes. 

With that said, here are the things I will be reading this weekend.

1) Be A Good Loser by Mebane Faber via Meb Faber Research 

“One of the biggest challenges of investing is long periods of underperformance,or outright negative performance and losses. Cliff Asness has a fun piece out on his blog where he talks about 5 year periods in stocks, bonds, and commodities and basically how anything can happen.

So if you're going to be an investor, get used to being a loser!”

Faber-Drawdown-121814

2) An Unconventional Way Of Looking At Valuations by GaveKal Research

“An unconventional way of looking at valuations is to place companies into different “buckets” based on their absolutely valuation level. This gives you a simple way of understanding where the majority of stocks lie in terms of valuations levels

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