This 1st Week of January 2022 Thoughts
A picture, or chart, is worth a thousand words
So, why did we hold onto cash in 2021: either the Schwab Money Market or SWVXX…Schwab Value Advantage. This chart is the best the best way to demonstrate why!
The chart below is the % return for different bonds, for the 4th Quarter of 2021…for all of 2021 and for the last 3-Years.
Focus on the middle column: the numbers under Return % 2021: this is the total return for 2021. NOTE how many bonds are “red” AKA they have lost money if you owned them for 2021. For example: the 1st number, Core Bond -1.61% means that you lost 1.61% if you held these bonds all year. Look a little lower: you lost 2.28% if you held U.S. Government Bonds all year.
I believe that 2022 will be a different story and we will see higher dividends…and be able to buy bonds at better prices. It is no fun to sit and wait…believing that bond yields would go up…but this week was worth it! I’ll be looking to FINALLY start adding to your bond holdings over the coming weeks!
Required Disclosures: Always read the fine print! This content reflects the opinions of Julie Skye and is subject to change without notice. This content is for informational and entertainment purposes, and it is not a recommendation regarding the purchase or sale of any security. There is no guarantee that any statements, opinions, or forecasts provided herein will prove to be correct. Past performance may not be indicative of future results. Securities investing involves risk, including the potential for loss of principal. There is no assurance any investment plan or strategy will be successful. Registration with the SEC does not imply a certain level of skill or training.
It is no secret that I spend a lot of time down in the weeds: that I love details, and charts. If we have worked together on one of your stocks…about how to know when a stock might be a good buy…or time to take profits, then you know that these stock charts are like old friends to me. There is so much information in these “tea leaves” and we totally ignore all the noise coming from the gurus who have opinions on what is going to happen.
Today, lets look at Apple…and see if it is a good time to buy…or maybe a time to take some profits. Start by “visually” drawing a line through the data…all the little “dashes” are the average weekly stock prices. When you position the line correctly, you will have as much space above, as below…and this is the trend line. Once you get used to drawing this line, you will easily be able to see trend lines for any stock…and if the the stock is in an up-trend or a down-trend.
With the Apple chart, look at the yellow trend-line I’ve drawn and at the green circles around a group of dashes. If you can put your finger OVER or BELOW this space above / below trend line, then you know something very important: a stock may be “too high” or may be bottoming. Pop Quiz: is Apple a Buy, here, or a Sell?
😲 Why does this matter to you? Look at the top, right of this chart: there is a “bulge” you can put your finger on, above the trend line for the last few weeks and Apple is trading at a high price. Now, look at the bottom right…and you see little red dashes BELOW the line. This is telling you that even though Apple stock is trading at all-time highs, the “Smart Money” is moving out...selling. I love technical analysis…looking at charts, or the Ouija Board, as one client calls them. I start each day looking at charts and I watch dozens of stocks for clients. Email me if you have a stock that you are interested in. Over the coming months, we’ll have lots of chances to buy… 😊