Vine Investing
  • Home
  • Home
Search by typing & pressing enter

YOUR CART

7/20/2010 0 Comments

A stressful Friday

The stress test for the European banks is due out at the end of this week.  I believe that the stress tests will remind people of the dangers within the Euro zone.  Should the results come back showing that Spain, among other countries' financial systems, aren't doing as well as people thought the Euro is likely to suffer.  European and US companies that have significant business in the Euro zone will most likely be hit more than the overall market.  Should the results of the stress tests be less severe than expected I think they will be looked at with a degree of skepticism and the validity of the stress test process will be questioned.  The safest way I can see playing this news is to short the Euro to a safe currency before Friday, there could be a pullback in the currency going into the news (flight to safety) where you can build a profit and then place a stop with a good margin of safety so you will either make money or break even when the stress test results are revealed.  This would provide a good hedge against your long positions as well.
0 Comments

7/19/2010 0 Comments

Euro pain = Euro gain?

Ireland's credit rating was downgraded and the IMF has pulled from the talks to provide funding to Hungary, yet the euro climbs against the dollar.  Despite the market movements this is not good news for the shared currency because it will further stem lending and lead to more downgrades throughout the region.  Austerity measures will have to be taken by Hungary and other nations to instill confidence back into the markets which could lead to civil unrest.  The disregard for the bad news by the Euro should be watched closely, if sentiment changes there are plenty of reasons for the Euro to drop as fast as it strengthened.  Also the US will have to be watched for signs of relative strength or weakness to Europe.
0 Comments

7/12/2010 0 Comments

Mixed earnings season

With the start of earnings season an hour away, it is unclear whether it will be good or bad for stocks.  Overwhelming upside surprises will put confidence back into the markets showing that earnings can grow despite high unemployment.  A series of disappointments will erode the confidence of the recovery further and bring the market lower.  I believe that the actual outcome will be somewhere in between with certain sectors performing better than others.  The best outcome from a mixed earning season will be the potential for individual stocks and sectors to break the high correlation with the index and perform on their own merits for better of for worse.  Look to replace bad positions that have been performing better than they should have with good positions that were performing worse than they should have.
0 Comments

7/9/2010 0 Comments

The US embraces export recovery

With the US looking towards exports as a way to stimulate growth and keep the recovery going, I think it would be beneficial to look into stocks that could benefit long term from this trend (should it become a trend).  There are a lot of factors that would help an export led recovery, rising Yuan, little sign of inflation in the US, and cheap transportation costs.  A few ways to play this would be transports such as rail, container shipping, or port operating companies.  For a more direct approach you could choose US companies that represent a large portion of US exports (aircraft, autos, semiconductors) or companies that are the fastest growing exports (fuel, coal, fertilizers, food stuffs).  This is not a trend that will occur overnight but it would pay to keep an eye out for a good entry point over the next few months to see if this trend develops. The examples above are based on 2008 export data.
0 Comments

7/2/2010 0 Comments

Unemployment Benefits = Rate Increases?

Congress is not going to vote on the extension of unemployment benefits until after the holiday recess, this means that many Americans unemployment compensation will run out.  Even after the recess there is no guarantee that Congress will get enough votes to pass the bill, this could lead millions to start looking for jobs that could pay less than unemployment was offering.  If the bill isn’t passed or takes a long time to pass, this could create a drop in the wage market that would reinforce the Fed not raising interest rates due to tame inflation and even the threat of deflation.  Not to mention the lower spending power by consumers will be a drag on the recovery as well.
0 Comments

7/1/2010 0 Comments

Perfect Storm

The negative data coming out of the US is creating a negative environment for the Vine strategy.  With the combination of the recovery experiencing setbacks and the light (read volatile) summer trading, I think the Vine strategy could experience more days like today where the Euro moves opposite of the US markets.  It would be wise to at a minimum lighten the 2nd segment of the strategy during any weakness in the Euro.  With markets as volatile as they are and the FX portion of the strategy containing leverage, it would be better to sit out on some profits and wait for a clearer picture of the overall economy.
0 Comments

    Archives

    June 2020
    April 2020
    March 2020
    December 2019
    November 2019
    October 2019
    September 2019
    June 2019
    May 2019
    April 2019
    March 2019
    February 2019
    January 2019
    December 2018
    November 2018
    October 2018
    September 2018
    August 2018
    July 2018
    June 2018
    May 2018
    April 2018
    March 2018
    February 2018
    July 2017
    June 2017
    May 2017
    March 2017
    February 2017
    January 2017
    December 2016
    November 2016
    October 2016
    September 2016
    August 2016
    July 2016
    June 2016
    May 2016
    April 2016
    March 2016
    February 2016
    January 2016
    December 2015
    November 2015
    October 2015
    September 2015
    July 2015
    June 2015
    May 2015
    April 2015
    March 2015
    February 2015
    January 2015
    December 2014
    November 2014
    October 2014
    September 2014
    August 2014
    July 2014
    June 2014
    April 2014
    March 2014
    January 2014
    December 2013
    November 2013
    October 2013
    September 2013
    August 2013
    July 2013
    June 2013
    May 2013
    April 2013
    March 2013
    February 2013
    January 2013
    December 2012
    November 2012
    October 2012
    September 2012
    August 2012
    July 2012
    June 2012
    May 2012
    April 2012
    March 2012
    February 2012
    January 2012
    December 2011
    November 2011
    October 2011
    September 2011
    August 2011
    July 2011
    June 2011
    May 2011
    April 2011
    March 2011
    February 2011
    January 2011
    November 2010
    October 2010
    September 2010
    August 2010
    July 2010
    June 2010
    May 2010
    April 2010
    March 2010
    February 2010

    Categories

    All Chinese Debt Commodities European Disunity Inflation Policy US Earnings

    RSS Feed