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On My Radar: Investors Behaving Badly

The first link below presents two interesting graphs. They may be of interest to those who are ruminating about making changes to their portfolios....and to others who are simply curious about long term stock market trends.

The first graph presents the historic annual relationship between the percent of household financial assets already invested in equities and the rolling 10-year annualized total return for the S&P 500 index. The graph uses this data to "project" the annual average stock market return looking forward 10 years from today. This data says that -- if this time isn't different -- the annual average return will probably wind up having been between about 2% and 3% when we look back 10 years to 2015 from the year 2025.

The second graph makes a similar statement about probable future market returns in a different way. It says that the amount of household liquidity currently available to put into the stock market is lower in 2015 than it has been in almost all years since 1952. This leaves limited additional domestic resources available to drive stock prices higher.

Here is the link to the 2 graphs:

http://www.cmgwealth.com/ri/on-my-radar-big-mo-still-says-go/

Also, here is a second link that presents the Trade Signals associated with the momentum strategy the author mentions at the end of his article.

http://www.cmgwealth.com/ri-category/trade-signals/
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