Darrell Bryant Retirement Blog

Wednesday, November 18, 2015

(Extended) 15-Minute Market Update

By Darrell Bryant

Comments from Jason Wenk, Chief Investment Strategist at Formula Folios Posted November 16, 2015– I am happy to present this week’s market commentary from FormulaFolio Investments. The goal is to give our clients and friends a simple way to see everything they need to know about the financial markets on a weekly basis, in 5 minutes or less.  After all, finances should be simple, not complicated.

Market Update

Markets were broadly down last week, and most are now negative YTD and over the past year. The market is on a roller coaster at the moment, with weekly changes starting to get investors unnerved. Be sure to watch this weeks special video update for some wisdom and reassurance if you’re not feeling financially confident.

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Lesson to be learned: One week up, one week down. Markets can do this in the short term, which is why we have to invest for the long term.

FFI Indicators

FormulaFolios has two simple indicators we share that help you see how the economy is doing (we call this the Recession Probability Index, or RPI), as well as if the US Stock Market is strong (bull) or weak (bear). In future posts I’ll write more about how these indicators are built and why we feel they are important.

In a nutshell, we want the RPI to be low on the scale of 1 to 100. For the US Equity Bull / Bear indicator we want it to be at least 67% bullish. When those two things occur our research shows market performance is strongest and least volatile.

There were no changes to our economic or Bull/Bear indicators this week. Historically, this means our models think there is a slightly higher likelihood of stock market declines in the near term future (think <18 months).

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Weekly Comments

Given the wild volatility of the last few months, we’re extending the 5-minute commentary to 15 minutes, via the video posted below. Be sure to watch the video to the end as it contains two crucial investment lessons that can benefit every investor.

*No chart, graph, or replication of prior market patterns is a guarantee of future market outcomes. 

More to come soon. Stay tuned.


Jason Wenk
Chief Investment Strategist