No Market Action. NASDAQ New Highs. Fabulous Guest Comments.

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Holy Concentrated Portfolio “BatTrader”. A longtime friend (hi Bill Ulivieri) passed along a very interesting market piece. I am VERY bearish (as readers know) so I am going to use these comments today so I can knock off early;

Over the past 10 weeks – so since March 1, 2017 – five stocks in the S&P 500 index have gained a total of $260 billion in market value, the infamous FAANG stocks: Facebook, Apple, Amazon, Netflix, and Google (now Alphabet). By any measure, $260 billion is a massive surge in valuation for just five stocks, or 1% of the S&P 500, in just 10 weeks. And the rest of the S&P 500? On March 1, the index closed at 2,394. Today it closed at 2,397. In those 10 weeks, it went absolutely nowhere. Which means this: the remaining 495 stocks in the index lost as much in total market capitalization as the FAANG stocks gained.”

“The five FAANG stocks combined have a market value of $2.4 trillion. That’s the size of the GDP of France. And just forget the rest of Corporate America and its struggles. On the other hand, a decline of 30% – not unheard of with these stocks – wipes out $720 billion. But we’ve been reassured: that’ll never ever happen again.”

These past few weeks are just plain boring. Markets (except for the Fab 5) are exhausted. Be forewarned. Have a nice evening.


*https://indexes.nasdaqomx.com/index/Overview/KFTX
** http://www.cmegroup.com/trading/cf-bitcoin-reference-rate.html