The biggest under-performers in 2013 have been those who invest according to hackneyed market truisms.
The Hindenburg Omen: Stocks are up 9% since the first sign of the dirigible of doom on April 5th. The sell signal has appeared many times since over the last six months, each of which coming below where the market sits today.
Sell in May and go away: The S&P500 (^GSPC) is up just under 7% since May 1st.
Sell Rosh Hashanah, buy Yom Kippur: Not this year. Stocks rose more than 2%
September is terrible for stocks: Again, not this year. Despite weakness into the end of the month, stocks rose more than 3.5%.
So here comes a double whammy for markets. October is legendary for the crashes of 1929, 1987 and a month-long deluge of pain that was September 2008. Add to that the notion that government shutdowns are bad for markets and many investors are battening down the hatches.
Simon Baker of Baker Ave Asset Management would be happy to buy whatever stocks you'd care to sell. "The big mistake everyone has been making the last 18 months is not being long the market" Baker points out in the attached clip. Baker isn't going to strenuously argue against the notion of some profit taking here but he's running out of the frying pan and into the fire on the risk side.
"If you want to steer clear because you think there's going to be volatility over the next couple weeks we like the emerging markets," Baker chirpily offers. For bears it's advice akin to recommending avoiding the dangers of cocaine by switching to meth. The iShares MSCI Emerging Market ETF (EEM) is down 8% year-to-date and has gotten there in a much more volatile way than the U.S. market.
For those looking to stay at home, Baker likes Cisco (CSCO), Apple (AAPL) and some of the social media stocks he's been favoring this year such as Facebook (FB) and LinkedIn (LNKD). Buy the dips, offers Baker, because he thinks the market is going to be higher by the end of the year.
Now is the time for those of you who always do the opposite of what talking heads say to make those feelings known in the space provided below.
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