The Celtics won the NBA Championship last night in what seems like one of the weirder NBA finals I can remember.From Doc Rivers' point of view the most important aspect was defense. The Celts d'd up the Lakers and just took away what the Lakers wanted to do.
By playing menacing defense they mitigated any potential periods of poor shooting.
This works in portfolio management too. By now you know about this RBS call by Bob Janjuah in the Telegraph calling for SPX 1050 by September.
There was a reader email waiting for me when I woke up asking whether the Janjuah call was cause for concern. For me it is not the least bit concerning or worrying.
Certain things are in our control and certain things are not. As a matter of life (as opposed to just market) philosophy it does not make sense to worry about things beyond our control.
Clearly whatever the stock market does this summer is beyond our control. What is within our control is the recognition that demand for equities has been unhealthy by several measures for many months now. Demand became unhealthy in late 2007 in the neighborhood of SPX 1500.
If demand is unhealthy for equities how aggressive should you be with equities? Heeding the warning that demand is unhealthy provides the opportunity to be spared the full brunt of down a lot which if done successfully can be more important than other parts of the stock market cycle that call for more offense.
Again, recognition that demand is unhealthy is within your control.
Alphaville has some more coverage of the RBS call.
A couple of comments came in about the Celtics, including a link to the Globe's front page, so thank you to those folks. Irregardless, ahem, this has been a helluva decade for Boston sports fans.
3 comments:
S&P 1050 would have been a nice call in December.
1050 wouldn't surprise me, but neither would 1500 (this year). The sentiment models I watch are getting closer to excessively pessimistic levels. I'm guessing the market will be in the process of putting in another bottom in the next month or two.
It's funny, I came on here to post that RBS link and you have it highlighted. I was also going to show this one as well on the writedowns:
http://tinyurl.com/437fno
Post a Comment