Category: DAILY INSTAGRAPH

Consider the chart below and imagine reviewing it five years from now. Wouldn’t it appear evident that this was an opportune moment to diversify your portfolio and reduce the concentration of megacap technology stocks, especially given their valuations at the time? We firmly believe that defensive stocks and cyclicals are undervalued in the current stock … Continued

Investors in bonds face two primary risks: duration risk and credit risk. Duration risk measures a bond’s sensitivity to interest rate changes, with higher durations indicating greater sensitivity. For a 30-year U.S. Treasury bond, credit risk is minimal due to the relatively strong creditworthiness of the U.S. government. On June 26, 2020, the 30-year U.S. … Continued

The Buffett Indicator, a simple ratio comparing a country’s total stock market capitalization to its GDP, is frequently referenced by Warren Buffett as a measure of overall market valuation. Presently, this indicator stands at an all-time high compared to its historical trends over the past 50 years, diverging significantly from global norms. This discrepancy can … Continued

Since 1990, the US Debt-to-GDP ratio has surged from 55.6% to 126.9%, a staggering increase. In stark contrast, Germany’s public debt level began at 59.3% but rose modestly to 64% over the same period. These figures prompt two crucial questions: Is the US economy overly reliant on leverage, akin to being on steroids? And has … Continued

Looking for reasons of why the copper price is up 30% over the last 6 months and copper mining stocks, like our portfolio holding Boliden AB, are up 26.2% over the period ? Our take: 1/ Manufacturing PMIs in expansion territory above 50 show that industrial production is recovering 2/ Not only the energy transition … Continued

The S&P 500 trades at 4.8 times book value, a free cash flow yield of 3.3% and 20.6 times 12 months forward earnings. This is far higher than the 10 year average and looks difficult to sustain longer term in the current interest rate environment. 2 comments however: 1/ High valuations alone are not a … Continued

The S&P 500’s top 10 companies, led by stalwarts such as Microsoft, Apple and Nvidia, command considerable attention from both media and investors, representing a substantial portion—approximately one-third—of the index’s weight. However, sustaining their positions at the summit proves to be a formidable challenge. Historical data illustrates a dynamic environment, with four of these industry … Continued

The age-old stock market axiom, “Sell in May and walk away,” reflects the historical trend of weaker stock performance from May to October compared to the rest of the year. While the precise reasons for this phenomenon are elusive, numerous academic studies have substantiated its validity over extended periods. Nonetheless, recent shifts in the landscape, … Continued

The “Magnificent 7” stocks have indeed dominated the S&P 500’s performance since the onset of the COVID pandemic, enjoying significant earnings growth while others fell behind. However, looking forward, it’s evident that this dynamic is poised for a change. In the coming quarters, we foresee a resurgence in earnings across diverse sectors and companies, potentially … Continued

At the end of Q1, the cash position of Berkshire Hathaway reached 189 bn USD. Warren Buffett does not appear to have a problem holding so much cash as he does not see many investment opportunities that move the needle for his holding. In his own words: “I don’t mind at all under current conditions … Continued