For today’s essay, it would be wise to remember the old investing adage: “The trend is your friend.”  As most investors already know, investing in trends is one of surest ways to success in the stock market. But while the phrase itself is simple enough to understand, we often find that most investors don’t know which trends to follow… or even worse, invest in the wrong ones.  Specifically, we generally find that investors want to focus on economic trends… things like interest rates and global debt/GDP ratios. Some investors go so far as to follow the cover model for the… Read More

For today’s essay, it would be wise to remember the old investing adage: “The trend is your friend.”  As most investors already know, investing in trends is one of surest ways to success in the stock market. But while the phrase itself is simple enough to understand, we often find that most investors don’t know which trends to follow… or even worse, invest in the wrong ones.  Specifically, we generally find that investors want to focus on economic trends… things like interest rates and global debt/GDP ratios. Some investors go so far as to follow the cover model for the current year’s issue of the Sports Illustrated Swimsuit Edition, believing that when the model comes from the U.S., the S&P 500 is likely to outperform.  Not to berate the homemade economists of the day, but these investors are most likely wasting their time. The truth is, economic trends can (and should) be mostly ignored by investors.  Even economists — people who have dedicated their entire lives to following macroeconomics — can’t accurately predict when a major economic event has (or will) occur. It took the National Bureau of Economic Research (NBER) 15 months to announce that the recession ended in… Read More

It was another perfect month for Income Trader’s Amber Hestla… A few weeks ago, three more “put” options Amber sold for her Income Trader portfolio expired worthless (when a put expires worthless, the seller keeps the premium they collected from selling the option as a 100% profit). The most recent victories mark Amber’s 26th, 27th and 28th (out of 28) profitable closed trades. If you’re a regular StreetAuthority reader, you’re likely familiar with Amber’s put-selling strategy. If not, you can read our previous issues explaining it in detail here and here.  In short, Amber collects extra investment income… Read More

It was another perfect month for Income Trader’s Amber Hestla… A few weeks ago, three more “put” options Amber sold for her Income Trader portfolio expired worthless (when a put expires worthless, the seller keeps the premium they collected from selling the option as a 100% profit). The most recent victories mark Amber’s 26th, 27th and 28th (out of 28) profitable closed trades. If you’re a regular StreetAuthority reader, you’re likely familiar with Amber’s put-selling strategy. If not, you can read our previous issues explaining it in detail here and here.  In short, Amber collects extra investment income by selling put options on stocks she thinks are undervalued. These “Instant Income” checks, as she calls them, usually range anywhere from $100… to $150 … to even $200. (And this is just for one put option. Many of her readers scale up to collect even more income.)  #-ad_banner-#Most of the time — 93% in Amber’s experience — the option expires worthless and the money she collects is hers to keep as pure profit. But if you read the above paragraphs closely, you’ll notice I said Amber’s current track record implies she’s yet to close an unprofitable trade… So if… Read More

Twenty-four billion dollars. That’s how much the political theater in Washington cost the American public according to Standard and Poor’s. The agency expects the loss will shave about 1% off fourth quarter GDP growth. But alas, investors can breathe a sigh of relief as it’s now apparent the U.S. won’t be defaulting on its Treasury payments — at least not yet. According to estimates by the Congressional Budget Office, the bill that raised the debt ceiling and reopened the government should keep the U.S. funded for at least another four months. While the short-term resolution is akin to the proverbial… Read More

Twenty-four billion dollars. That’s how much the political theater in Washington cost the American public according to Standard and Poor’s. The agency expects the loss will shave about 1% off fourth quarter GDP growth. But alas, investors can breathe a sigh of relief as it’s now apparent the U.S. won’t be defaulting on its Treasury payments — at least not yet. According to estimates by the Congressional Budget Office, the bill that raised the debt ceiling and reopened the government should keep the U.S. funded for at least another four months. While the short-term resolution is akin to the proverbial “kicking the can down the road” (setting us up for the same debate come February), the markets have nonetheless rejoiced on the news… #-ad_banner-#In the weeks that followed the debt agreement, the S&P touched a record level of 1,766… gold rallied 7% to $1,350 per ounce and the yield on the 10-year treasury fell to 2.5%. As the euphoria from the announcement wears off, the market is turning its attention to what will likely be the biggest financial event over the next few weeks… earnings season. In case you didn’t know, third quarter earning season is alive and well… And… Read More

The “Bond King” has issued a dire warning for income investors. If he’s right, it could affect how much money people earn from dividend and interest payments for the next two decades.  The “Bond King” is Bill Gross, one of the biggest names on Wall Street. Not only is he co-founder of Pacific Investment Management Co. (PIMCO), one of the largest investment firms in the world, but as money manager of the PIMCO Total Return Fund, he’s directly responsible for over $270 billion in assets.  So what is the “Bond King” predicting?  In short, Gross thinks interest rates could stay… Read More

The “Bond King” has issued a dire warning for income investors. If he’s right, it could affect how much money people earn from dividend and interest payments for the next two decades.  The “Bond King” is Bill Gross, one of the biggest names on Wall Street. Not only is he co-founder of Pacific Investment Management Co. (PIMCO), one of the largest investment firms in the world, but as money manager of the PIMCO Total Return Fund, he’s directly responsible for over $270 billion in assets.  So what is the “Bond King” predicting?  In short, Gross thinks interest rates could stay low — ridiculously low — for a long, long time. According to his analysis, interest rates could stay as low as 1% until sometime around 2035.  #-ad_banner-#The reason for the perennial low-rate environment, as Gross explains, is the government’s desire to create a “beautiful deleveraging” — which is financial lingo for saying the U.S. wants to lower its dependency on debt without sacrificing the health of the overall economy.  As Gross explains in his most recent Investment Outlook letter:  “If the Fed’s objective is to grow normally again, then there is likely no more beautiful or… Read More

Investors are getting nervous about the events going on in Washington…  As the United States shutdown continues to drag on, Congress is no closer to reaching a resolution than they were when the debate began. #-ad_banner-#While we think that the shutdown is nothing more than “political theater” and should have… Read More

And so it begins… As the clock struck midnight Monday, Congress failed to reach an agreement on a short-term budget resolution. As a result, for the first time in 17 years, the United States has entered a shutdown, and thousands of government employees have been furloughed. Depending on how long… Read More

Things are turning around for one of the largest companies in the world… After falling 11% in the first half of September, Apple (Nasdaq: AAPL) has rebounded from its monthly low of $450 a share. Before the rally, shares of Apple were down due to market concern that demand for… Read More

During the past five months, natural gas has been on a tear… Yet nobody has seemed to have notice. Earlier this year, due to a warm winter and above average inventory levels, natural gas prices fell to as low $1.90 per thousand… Read More

It finally happened. Gold stocks are breaking out… Gold stocks — or gold miners to be exact — are the companies that physically remove gold bullion from the ground and bring it to market. How much money a gold-mining company makes is… Read More

Next time you go to the grocery store, check the price of your favorite cereal… Is it more expensive than the last time you bought it? Chances are, it is… In the past few months, food prices have surged. Take a look at the chart below. As… Read More