>Still Climbing the Wall of Worry

>Historically May brings cracks in the proverbial wall of worry. Equities have a contrarian bent to go up when on the surface things look bad. Political infighting, fear of inflation and Mideast turmoil has been the theme this month causing investors to still sit on the sidelines when the markets are undervalued. One of my indicators I watch, provided by Don Hayes of Hayes Advisory, the psychology of the market which suggests complacency in its highest form. The amount of cash sitting on the sidelines is still higher than it was at the 2002 bear market lows, and the highest it has been since the early 1990s. Currently the reading of cash to the S&P is 100.2%. What that means is that there is almost precisely enough money in the economy to buy all of the S&P 500 companies outright.

Various indexes are reaching an oversold level that we have not seen for several months, including muni bonds, commodities and currencies. The challenge to investors is if they have the wherewithal to take advantage of these windows of opportunity. We have raised some cash starting in early May due to relative strength fading in some sectors and locked in some profits, but we will be fully invested by the end of next week; if the market provides us the opportunity by correcting a little further.

Please forward me your comments. If you have someone that might be interested in working with us or receiving this information please let us know. Don’t keep us a secret!

Thanks for reading,



About Riley Wealth

We’re here to help you achieve your financial goals, manage your money, and make your life better. Our firm is not like most other investment advisors. We are an independent advisory firm, with no ties to a large Wall Street firm. You receive advice unblemished by the conflicts of interest that have plagued Wall Street firms. We are free to recommend the best financial products to help you meet your goals. And with no sales quotas, we can devote the time needed to properly research and monitor your investments. You also benefit from our size. As a boutique advisory serving high-net-worth individuals, every relationship is important to us. With no national ad campaigns, we rely on referrals from people in our community to grow our business. You won’t be treated like just another account number, and there is no corporate bureaucracy when you need an answer about your money. Our staff understands that you expect excellent service.
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