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ECNFINWinners and Losers for the Week of May 26–May 30, 2025
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During the week of May 26–May 30, 2025, the best-performing asset classes were (see Table 1):
U.S. Treasury Long-Term Bonds (ticker: TLT), which rose by 2%
Technology-heavy NASDAQ-100 ETF (ticker: QQQ), which gained 1.9%
U.S. Equities S&P 500 ETF (ticker: SPY), which increased by 1.8%
The worst-performing asset classes for the week were:
iShares Bitcoin ETF (ticker: IBIT), down 3.8%
MSCI China ETF (ticker: MCHI...
2025-06-0203 minECNFINWinners and Losers for the Week of May 12 – May 16, 2025
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During the week of May 12 – May 16, 2025, technology stocks experienced significant positive appreciation, driven in part by relaxed export restrictions and deal-making initiatives by President Trump (see Table 1).
Top-Performing Asset Classes:
NASDAQ 100 (QQQ): +6.9%
Total US Market Index (VTI): +5.3%
S&P 500 (SPY): +5.3%
The biggest loser for the week was gold, which experienced a decline after a period of record-setting gains. The...
2025-05-1802 minECNFINWinners and Losers for the Week of May 5 – May 9, 2025
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During the week of May 5 – May 9, 2025, the major economic news was that the Federal Reserve maintained its interest rate range between 4.25% and 4.5%. The Fed emphasized that while the current economy appears stable, the future remains highly uncertain. This uncertainty is driven by concerns about U.S. tariffs and the reliability of economic data from the first quarter, which was distorted by temporary pull...
2025-05-1004 min
ECNFINThe Federal Reserve Holds Interest Rates Steady: What Does It Mean for Investors?
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The Federal Reserve announced today that it will maintain its short-term interest rate within the range of 4.25% to 4.5%. Federal Reserve Chair Jerome Powell described the economic outlook as “highly uncertain” but also noted that the economy remains stable. On the positive side, unemployment is low at 4.2%, which Powell characterized as being near maximum employment, fulfilling the Fed’s first mandate. The second mandate...
2025-05-0808 min
ECNFINAsset Allocation Based on 20 Years of Market Data
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Is there a preferred asset allocation that can consistently deliver positive risk-adjusted returns across all market environments? This paper analyzes 20 years of market data to answer that question.
In this research paper, I analyze 20 years of stock market returns, divided into four periods of five years each, spanning from 2005 to 2025. For each period, I derive the optimal asset allocation based on...
2025-05-0709 min
ECNFINInvesting Principle #14: The stock markets are informationally efficient and may provide opportunities for long-term investors.
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The stock market is informationally efficient. It reflects nearly all available public information in stock prices. You have an opportunity to know about the company and the stock price as much as anybody else can legally. For beginner investors, selecting broadly diversified ETFs with low costs is probably the best way to start investing. Eugene F. Fama won Noble Prize in...
2025-05-0205 min
ECNFINIs the S&P 500 Fairly Valued as of April 30, 2025?
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The stock market has been highly volatile. As of April 30, 2025, the S&P 500 Index has recovered 62% of its losses from the year’s low, yet remains approximately 9% below its year’s high. With new Gross Domestic Product (GDP) data released today, this presents an opportune moment to assess whether the S&P 500 is expensive or cheap relative to the broader U.S. econom...
2025-05-0106 min
ECNFINInvesting Principle #13: Information travels near the speed of light. Do not try to overrun it.
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The financial markets are pretty efficient. High-frequency traders have fiber-optic cables in close proximity to major US stock exchanges. Many trades are done using computer algorithms. These trades are executed near the speed of light. Whenever you hear or see new information, it is already incorporated in the stock price. All the news you hear on CNBC or Bloomberg is already reflected in...
2025-05-0102 min
ECNFINInvesting Principle #12: There are no shortcuts. If it is too good to be true, it probably is.
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You may remember a hype around GameStop and stories of investors turning $500 into $200,000. Stories like this can cause the investor to fall victim to the cognitive bias – bandwagon effect. Just because more and more people are buying GameStop, you may want to join the group and be included in making a lot of money fast. The cognitive bias makes it easy to jump...
2025-04-3004 min
ECNFINInvesting Principal # 11: Select the right financial advisor who will represent your best interest
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At some point, you may want to seek the help of a financial advisor. A financial advisor can provide education, guidance, and personalized strategies to help you reach your financial goals. They can also conduct research, manage your investments, and monitor your portfolio, allowing you to focus on enjoying life.
But how should you select the right financial advisor?To...
2025-04-2803 minECNFINWinners and Losers for the week April 17-25, 2025.
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From the market close on April 17th to the close on April 25th, the best-performing asset classes and sectors were:
Bitcoin led the gains, rallying 12.5% over the week and overtaking gold in performance.
The NASDAQ-100 Index, weighted heavily toward technology companies, rose 6.4%.
Latin American equities advanced 6.2%, making them the third-best performer.
The MSCI China Index posted a 5.3% gain.
Most other major eq...
2025-04-2603 min
ECNFINInvesting Principal #10: Be aware of individual company risk and do your homework
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Investing in individual company stocks may provide an attractive potential return, but it comes with both company-specific and market risk combined. Most investors like to brag about the high-performing stock picks they made during cocktail parties; it is very exciting to pick the winner and tell stories. Nobody is excited to talk about investing in a well-diversified Exchange Traded Fund (ETF). An ET...
2025-04-2502 min
ECNFINInvesting Principal 9: Diversification may lower volatility and help you achieve your financial goals.
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A diversified portfolio can create a more comfortable environment for investors to weather the ups and downs of the stock market. A well-diversified portfolio typically carr...
2025-04-2408 min
ECNFINInvesting Principal #8: Understand your risk tolerance before you invest.
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The first step in building an investment portfolio is to understand your true risk tolerance before investing. How much risk can you tolerate both in theory and in practice? It is easy to fall a victim of being a risk taker on paper but realize risk aversion in reality. When the stock market enters a correction territory by falling more than 10%, the fe...
2025-04-2307 min
ECNFINInvesting Principle #7: How investment returns may improve your quality of life?
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By now, you understand what it takes to build a sizable investment portfolio over time. John began investing $100 per month, with an assumed 12.5% annual return, he was able to accumulate $510,000 by the age of 50.
But what can you do with $510,000?
You could use this portfolio to supplement your salary or potentially live entirely off your investments. Let’s say...
2025-04-2203 minECNFINWinners and Losers for The Week April 14–17, 2025
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During the week of April 14–17, 2025, U.S. equities lagged, while international stocks, oil, and gold outperformed.
The worst-performing categories were:
Dow Jones Industrial Average: –3%
Nasdaq 100: –2%
S&P 500: –1%
The top-performing categories included:
Oil (West Texas Intermediate): +5%
MSCI EM Latin America: +4%
MSCI Canada, India, Japan, and Europe: each +3%
Gold: +3%, continuing its upward momentum
Fixed income held up well, with price...
2025-04-2003 min
ECNFINInvesting Principal #6 – Start Early and Contribute Regularly to Your Investment Portfolio.
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You can open an investment account with as little as $100 today. Making regular contributions may significantly enhance your investment returns. Time is one of the most...
2025-04-1904 min
ECNFINInvesting Principal #5 – Patience may pay off in the long run.
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You should allow enough time for your investment strategy to succeed. Assuming your original investment thesis is sound, the longer you stay patient and avoid reacting impulsively to market news, the better your performance may be over time.
However, it’s important to distinguish between patience and pride. Sometimes, it’s necessary to recognize when a mistake has been made and to...
2025-04-1803 min
ECNFINInvesting Principal #4 – Smart cash management may decrease risk and increase returns for investors.
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Investors should keep cash savings in their bank accounts for rainy days. Cash reserves can serve as a hedge against unexpected future expenses (Ivan Sichkar, 2012). This is a prudent risk management strategy that may also enhance overall investment returns.
The need for unexpected cash often rises during economic downturns, when the risk of job loss and prolonged unemployment is higher. Wi...
2025-04-1703 min
ECNFINInvesting Principal #3 – Open the right type of investment account for your needs.
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Selecting the right type of investment account may improve your after-tax investment returns. Most of the time, you will need to choose between taxable, tax-exempt, or tax-deferred account types. In many cases, it may be beneficial to have both taxable and non-taxable accounts.
What are the benefits of taxable and non-taxable accounts? Below is a brief description of a few av...
2025-04-1606 min
ECNFINForecast the Future Standard & Poor’s 500 Index for the 1st Quarter 2023
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This is the forecast of the S&P 500 Index for 1Q 2023. It is based on the linear regression model, where I use the Gross Domestic Product (GDP) to predict the value of the S&P 500 Index. This forecast tries to predict a general pattern and direction of the stock market in the near future. When the forecast calls for a negative return, it...
2023-03-0309 min
ECNFINImpact of High Oil Prices, Inflation, Debt and Restrictive Monetary Policies on the Health of the Economy
Podcast: Impact of High Oil Prices, Inflation, Debt and Restrictive Monetary Policies on the Health of the Economy.
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It is a combination of multiple negative factors that creates a worrisome diagnosis for already fragile economic health of the US economy. A sharp increase in oil prices from $22 in April 2020 to $120 in June 2022. The highest inflation since 1981 which is likely to stay elevated fo...
2022-06-1516 min
ECNFINEconomic Recession Maybe Around the Corner in the US and Europe
Podcast: Economic Recession Maybe Around the Corner in the US and Europe
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Inflationary pressures are becoming less transitory and more long-lasting. Even before the horrific events in Ukraine, inflation was already very high. Additional sanctions on Russia added additional fuel to the fire of already hot inflation. Sanctions on Russia will also have a significant negative economic effect on the world economy an...
2022-03-2100 min
ECNFINForecast the Future Standard & Poor’s 500 Index for the 1st Quarter 2022
Podcast: Forecast the Future Standard & Poor’s 500 Index for the 1st Quarter 2022
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This is the forecast of the S&P 500 Index for the 1Q 2022. It is based on the linear regression model where I use the Gross Domestic Product (GDP) to predict the value of the S&P 500 Index. This forecast is trying to predict a general pattern, direction, of the stock mark...
2022-02-1110 min
ECNFINFifteen Investing Principles
Podcast: Fifteen Investing Principles
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Why should you invest? By investing today, you invest in your future with the hope of a better quality of life. Investing has become more accessible than before. Commission free trading provided access to financial markets for investors of all sizes, it created a greater opportunity to profit even for small investors.Open the right type of the investment accou...
2021-04-2745 min
ECNFINThe analysis of the stock market volatility and ways to mitigate the risk
Podcast: The analysis of the stock market volatility and ways to mitigate the risk.
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Abstract:
Oftentimes a successful investing requires the time commitment, ability, and wiliness to take...
2021-03-0100 min
ECNFINHow will the new US Secretary of the Treasury Janet Yellen effect the Economy and the Stock Markets?
Podcast: How will the new US Secretary of the Treasury Janet Yellen effect the Economy and the Stock Markets?
President elect Joe Biden nominated Janet Yellen as the 78th United States secretary of the treasury. In my opinion, Janet Yellen will support aggressive fiscal stimulus of the US economy at the beginning of her new job. Her prior experience as the chair of the Fed will create a bridge and very favorable relationship between the current Fed chairman Jerome Powell and the US Treasury Department. Both Yellen and Powell share similar interests in helping the economy and unemployment first a...
2021-01-2710 min
ECNFINForecasting the Future Standard & Poor’s 500 Index for the Year-End 2021
Podcast: Forecasting the Future Standard & Poor’s 500 Index for the Year-End 2021
This is my 9th annual forecast of the S&P 500 Index return for the year. This forecast tends to predict a general pattern, direction, of the stock market in the future. When the forecast calls for a negative return, it is a warning sign. It means that the market is ahead of itself and may see a poor performance and volatility in the next 12 months. My forecast does not predict an absolute number rather it gives an overall feeling for the general direction of the stock market in th...
2021-01-1112 min
ECNFINValuation of Government Bonds
Podcast: Valuation of Government Bonds
Current valuation of government bonds became expensive. In this paper, I compare the total return on the iShares 20+ Year Treasury Bond ETF (ticker TLT) with the real yield on the 10-year US treasury bonds. By investing in the long-term US government bonds when the real rates are negative, makes such investment speculative and risky.
The daily real yield on the 10-year US treasury bonds is at the historical lowest level. The real yield on the 10-year US Treasury bonds was -0.96% on December 10, 2020, according to the Federal Reserve Bank of St. Louis d...
2020-12-2107 min
ECNFINHow did the international stock markets perform during the Covid-19 recession?
Podcast: How did the international stock markets perform during the Covid-19 recession?
The effect of the Covid-19 on the stock markets around the world was widespread. Most major equity markets around the world witnessed a steep decline in the stock prices. However, the degree of the stock market correction and recovery was different from one country to another. How did various stock markets around the world weather the Covid-19 pandemic?
The Covid-19 originated in Wuhan, China. By being the ground zero, you may expect the Chinese stock market to suffer the most from the Covid-19 pandemic. Surprisingly, t...
2020-10-0707 min
ECNFINHow much home can you afford to buy due to the decrease in interest rates? Analysis of today’s housing market.
Podcast: How much home can you afford to buy due to the decrease in interest rates? Analysis of today’s housing market.
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Mortgage interest rates have been declining for the last 2 years. There is indirect relationship between the interest rate and home affordability. As rates decrease, the among of money one can borrow increases. With a significant decline in rates, home buyers can borrow more while keeping the monthly payments the same.
Mortgage rates have been in decline since October 2018 until September 2020. On Oct...
2020-09-2811 min
ECNFINThe Simple 50/50 Asset Allocation Model – Proven to Withstand the Financial Crisis of 2008 and Covid-19 Pandemic
Podcast 3: The Simple 50/50 Asset Allocation Model – Proven to Withstand the Financial Crisis of 2008 and Covid-19 Pandemic
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The stock market in 2020 can be described as unexpected and highly volatile. With a sharp sell off in February-March to an equally impressive V-shaped recovery. High volatility increases anxiety and can force investors to make poor decisions about investments. Investors may not be able to control their emotions, but they can control how they invest. For risk averse investors, selecting a model with lower volatility is a prudent decis...
2020-09-1608 min
ECNFINStructural Wage Stagnation Causes Economic Weakness
Podcast 2: Structural Wage Stagnation Causes Economic Weakness
Wage stagnation is not a new phenomenon but a structural change in the US economy. Looking over the last 34 years, real income remained almost unchanged. Because of the wage stagnation economic growth in the US grew moderately. As disposable income remains relatively unchanged, people have little room to increase spending. Because of low spending growth, there is a limited upside potential for the economy to grow. At the same time, any disruptions to personal income can cause abrupt decline in consumer spending. Since consumer spending explains 70% of Gross Domestic Product (GDP) in...
2018-07-2211 min
ECNFINPassively Managed Funds and Heuristic Biases: New Challenges and Opportunities
Podcast 1: Passively Managed Funds and Heuristic Biases: New Challenges and Opportunities
The structure of financial markets has changed with the rapid growth and popularity of passively managed funds. Passively managed funds can have a similar effect on the economy as systemically important financial institutions. Trading in passively managed funds may directly affect thousands of securities and have an additional indirect effect across different asset classes. Recently, the correlation among different asset classes has increased making it difficult for investors to diversify. It is fair to say that due to a greater popularity of passively managed funds their influence to...
2014-07-0916 min