The overall economy continues to push along and make new highs, and confidence is still in the equities market as valuations continue to rise. Now may be the time to look at taking profits as the market has been bullish for a long period of time. Beyond that, look at the PE ratios of the companies in the respective market you are researching to see how the compare in value.
Other factors that can begin affecting the market are geopolitical events such as North Korea or comments from the Trump administration. Certainly people have a close watch on what President Trump says because it can cause fear in the marketplace. Right now, the North Korea and United States feud has settled but that doesn’t mean people have forgotten. For a measure of fear in the market, look the VIX, which is the volatility index and can tell you if people are taking note.
Oil is beginning to stabilize post hurricanes, but many still think there is an oversupply in the market. This hurts oil producers or companies that sell an oil commodity. Low oil prices benefit airlines and the average consumer because of lower fuel prices. In theory, there is a happy medium and that is the goal of every market, to find where buyers and sellers are happy with the margins.
Overall, the market continues to be solid and show no signs of slowing because the Dow has opened at an all time high today. It is important to evaluate portfolios on an annual basis because it will allow you to keep tabs on market movements. Now would be a good time to see because depending on your situation, it may be time to take some profits off the table and the bull market has been going for almost 10 years. Long term buying and holding is still the preferred method of investing by most, and can prove to give you the best return.
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Try AI Portfolio ArchitectNathan Young is a Senior Member of Macroaxis Editorial Board - US Equity Analysis. With years of experience in the financial sector, Nathan brings a diverse base of knowledge. Specifically, he has in-depth understanding of application of technical and fundamental analysis across different equity instruments. Utilizing SEC filings and technical indicators, Nathan provides a reputable analysis of companies trading in the United States.
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