I make no guarantees or claims, but I believe that by being in the right asset classes and individual investments at the right time, at least increases your probability to better than mediocre returns over the long haul.
So let’s see where the market is at currently. We have to worry about today. Where would I invest Melissa’s money today?
Let’s begin with our market timing. Is this a time to be in or out of stocks?
One-year chart of the S&P 500
I think I will pass on the one-year CD’s right now. The STOCK MARKET continues to hit new highs.
Those 1% annual CD’s may come in handy in a bear market, but this bull is now 4.8 years old and the FES is still behind us.
The market has hardly paused since November of last year, and for now it is still going strong. 1800 is a new all-time high for the Standard and Poor’s index.
One-year chart of the NASDAQ:
The NASDAQ is ever so close to 4,000. It makes little sense to sell here.
One-year chart of the DJIA
This is a fresh, new breakout for the Dow that has carried it above 16,000 for the first time. I predicted that it would breakout out again just two weeks ago. Where will the Dow be 87 years from now? Over one million? I guess I will never know. It looks like all systems are still go on the stock market for now, however.
Let’s check the current ranking of the asset classes. I rank 45 different asset classes (including a lot of stock and bond oriented ones) on a daily basis. I generally focus on the top 8-10. Here is how they currently stack up:
Top 8 (3 wks. ago)
Top 8 (2 wks. ago)
Top 8 (This week)
These small and mid-cap, domestic stock trends have been in place all year long. Nothing has changed this week. THE TOP TEN OUT OF 45 ASSET CLASSES ARE STILL STOCK ORIENTED!
Stocks continue to rule the roost. Now let’s look at the worst-ranked asset classes.
Bottom 8 two weeks ago
Bottom 8 last week
Bottom 8 this week
BEING SHORT THE MARKET is still the worst place to be. Gold is down 25% year to date; interest rate sensitive investments and bonds continue to be very poor places to be invested. In fact the bond market is in a BEAR MARKET. Why would I put money in bonds right now?
So where would I put the money today? This bull market is now almost five years old. It will end at some point in time, but stocks are still the best play—preferably American small, and mid-caps!
Dow one million here we come. Who wants to be a millionaire?