I keep hearing people say that there is "too much negativity out there."
Investors should understand that the way this is typically presented, it is merely an opinion. ("I think, I feel, I believe").
However, I prefer quantitative metrics — hard numbers — to feelings/opinions. Dougie Kass sends along these two data points:
• The cash positions in mutual funds stand at 3.8%, slightly below the 3.9% low established in 1972.
• Margin debt as a percentage of the S&P market cap has
climbed to 2.4%, an all-time high. The previous peak? Early 2000, at the height of the Internet bubble.
Data always trumps anecdotal evidence.
What’s in your
wallet sentiment model?