Tech Tail Risk

An investor can look at return on equity (ROE) to determine how well a company is using its assets to generate profits. Additionally, one can calculate ROE by dividing net income by shareholder equity. Is there a good ROE percentage? Acceptable ROE percentages tend to...

Three-Sigma Valuation Warning

When it comes to understanding the wackiness of the 2020 stock bubble, it may be instructive to look at valuation indicators that correlate highly with future investment returns. For instance, one might combine the data from the Q Ratio, Crestmont P/E, PE10 and...

‘Risk-On’ Reversal

Even in 2000, investors did not fall in love with far out-of-the-money calls on tech shares to juice gains. In 2020? The indefatigable upsurge in call options relative to put protection has been unrivaled. Naturally, this is the sort of nonsensical bullishness that...

Ketchup or Blood on the Street?

Extended periods of overbought conditions in relative strength (RSI) typically lead to market pullbacks. Equally telling? The RSI for the S&P 500 has hit 81 — a relatively rare feat in and of itself. In a similar vein, at 3567, the S&P 500 is trading 15%...