Nathan Geraci

Stock Market ≠ Economy

The S&P 500 followed one of its worst quarters ever with one of its best. After experiencing a nearly 20% drop in the first quarter, including a harrowing 34% decline from February 19th through March 23rd, the S&P 500 jumped 20%+ in the second quarter. This despite the fact that yet another wild card was dealt… civil unrest. In the midst of confronting a once-in-a-generation pandemic, the country faced social discord on a level not seen since the 1960s. It’s no stretch to say the last six months have felt more like six years. Incredibly, stocks are somehow only a

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Bulls, Bears, & Swans

U.S. stocks experienced their worst first quarter ever, with the S&P 500 dropping nearly 20% as the world grappled with a pandemic.  Notably, from its February 19th record high through March 23rd, the S&P 500 shed 34%, the fastest such decline ever.  International stocks fared even worse. Of course, the impact of COVID-19 extends well beyond the stock market realm.  The economy has effectively ground to a halt, with many businesses shuttered indefinitely.  A record 17 million Americans filed for unemployment over the past three weeks.  Our daily lives have been significantly altered.  Social distancing, face masks, working remotely, schools

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10 Years Older, but 10 Years Wiser

The 2010s marked the first decade since immediately prior to the Civil War that the U.S. economy didn’t suffer at least one recession.  The S&P 500 went the entire decade without experiencing a single 20% drawdown, or bear market.  That hasn’t happened in 120 years! These facts are made even more remarkable when you consider the events of the past ten years:  Greek bailout, U.S. debt downgrade, European sovereign debt crisis, “fiscal cliff”, Cyprus banking crisis, “taper tantrum”, Ebola virus, Syria, Chinese currency devaluation, Brexit, 2016 U.S. Presidential election, trade war, yield curve inversion – to name a few (or

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Market “Signs”

Most will recall the 1970s hit song “Signs” by Five Man Electrical Band.  Even if you don’t initially recognize the tune, the iconic refrain will likely jog your memory: “Sign, sign, everywhere a sign Blockin’ out the scenery, breakin’ my mind Do this, don’t do that, can’t you read the sign?”   The song was written by the band’s lead singer, Les Emmerson, after a California road trip.  From Songfacts: “Emmerson wrote the song after taking a road trip on Route 66 in California, where he noticed a plethora of billboards that obscured the beautiful scenery.  This posed a question:

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Fed Keeps the Party Going

Nathan Geraci is President of The ETF Store, Inc. and host of ETF Prime. Despite hitting a speed bump in May, U.S. stocks continued rolling along in the second quarter of 2019 and posted their best first half of a year since 1997.  The S&P 500’s 6%+ decline in May was fueled by concerns over an ongoing U.S.-China trade war and slowing global economy.  Those fears proved temporary with the Federal Reserve striking a dovish tone in June, providing a confidence boost to investors wondering how much longer the current bull market run can last.  The S&P 500 gained 7% in

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Headlines, The Fed, & Investor Behavior

If 2018 was noteworthy because nothing in an investment portfolio seemed to work, 2019 is striking in that nearly everything is working.  Most major asset classes were positive in the first quarter, in stark contrast to last year when only cash and select areas of the bond market offered salvation. Most investors will vividly recall the S&P 500 declining 20% from September 20th to December 24th of last year.  Since that time, it has risen 21% through the end of March. The wild stock market action over the past six months provides yet another crash course (pun intended) on the

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Investors’ Two Best Friends: Time & Diversification

Nathan Geraci is President of The ETF Store, Inc. and host of ETF Prime. After hitting record highs on September 20th, the S&P 500 dropped 20%+ through December 24th.  A less than spirited holiday week bounce only somewhat salvaged the carnage.  Up 11% late into the 3rd quarter, the S&P 500 ended 2018 down 4.5%.  The swoon ended a streak of 9 consecutive years of gains following the global financial crisis, tied for the longest such streak in history.  The contrast between the first three quarters of 2018 and the fourth was stark: Source:  Tim Edwards, S&P Dow Jones Indices  

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Embrace Diversification

Nathan Geraci is President of The ETF Store, Inc. and host of ETF Prime. After limping to a 2.5% gain during the first six months of the year, the S&P 500 surged more than 7% in the third quarter to all-time highs.  Stocks posted strong gains despite global trade concerns, rising interest rates, partisan political discourse, and a bull market some view as long in the tooth.  Underpinning the market’s ascent was a healthy economic backdrop, with the latest measure of GDP showing a 4.2% annual growth rate and unemployment near 50-year lows.  U.S. companies are riding the wave of an

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Stock Market – The Ride

Nathan Geraci is President of The ETF Store, Inc. and host of ETF Prime. Every investor knows the old cliché that the stock market is like a roller coaster, up and downs, twists and turns, both an exhilarating and scary ride. However, the roller coaster analogy doesn’t always quite fit. A roller coaster never really goes anywhere, always ending-up right back where it started. Meanwhile, stocks tend to march higher over time, though certainly not without a few adventures along the way. However, with summer vacations and trips to amusement parks in full swing, it occurs to us the first

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Changing Back to Normal

Nathan Geraci is President of The ETF Store, Inc. and host of “The ETF Store Show“. A key theme in the stock market last year was a lack of volatility.  For the first time ever, stocks were positive in all twelve calendar months and experienced only eight days with up or down moves exceeding 1%, one of the least volatile years on record.  2018 began on a similar note, with stocks racing out of the gate and volatility nonexistent.  The environment shifted abruptly in early February as stocks plummeted 10%+ with a historic spike in volatility.  Since then, the ride

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