• 657 days Will The ECB Continue To Hike Rates?
  • 658 days Forbes: Aramco Remains Largest Company In The Middle East
  • 659 days Caltech Scientists Succesfully Beam Back Solar Power From Space
  • 1,059 days Could Crypto Overtake Traditional Investment?
  • 1,064 days Americans Still Quitting Jobs At Record Pace
  • 1,066 days FinTech Startups Tapping VC Money for ‘Immigrant Banking’
  • 1,069 days Is The Dollar Too Strong?
  • 1,069 days Big Tech Disappoints Investors on Earnings Calls
  • 1,070 days Fear And Celebration On Twitter as Musk Takes The Reins
  • 1,072 days China Is Quietly Trying To Distance Itself From Russia
  • 1,072 days Tech and Internet Giants’ Earnings In Focus After Netflix’s Stinker
  • 1,076 days Crypto Investors Won Big In 2021
  • 1,076 days The ‘Metaverse’ Economy Could be Worth $13 Trillion By 2030
  • 1,077 days Food Prices Are Skyrocketing As Putin’s War Persists
  • 1,079 days Pentagon Resignations Illustrate Our ‘Commercial’ Defense Dilemma
  • 1,080 days US Banks Shrug off Nearly $15 Billion In Russian Write-Offs
  • 1,083 days Cannabis Stocks in Holding Pattern Despite Positive Momentum
  • 1,084 days Is Musk A Bastion Of Free Speech Or Will His Absolutist Stance Backfire?
  • 1,084 days Two ETFs That Could Hedge Against Extreme Market Volatility
  • 1,086 days Are NFTs About To Take Over Gaming?
How Millennials Are Reshaping Real Estate

How Millennials Are Reshaping Real Estate

The real estate market is…

The Problem With Modern Monetary Theory

The Problem With Modern Monetary Theory

Modern monetary theory has been…

Zombie Foreclosures On The Rise In The U.S.

Zombie Foreclosures On The Rise In The U.S.

During the quarter there were…

  1. Home
  2. Markets
  3. Other

Want To Do Better? Invest in Areas Where You Have Better Odds

Many investors say they do that by looking at the strong and weak Sectors and then playing them accordingly.

But, few investors take the next step and ask the following question: "Does one price level have a decided advantage over another price level?"

It sounds like a simple question, but it really isn't. What the question is really asking, is about whether it is the larger or smaller investor that is bullish at a given point in time.

Let me explain ... Imagine that you took a count at the close yesterday, of how many stocks reached a 1 month high and a 1 month low. Let's take that another step further and split the counts by how many stocks were above $10 and how many stocks were below $10.

If you ran the data last night, you would have had these counts:

how many stocks reached a 1 month high and a 1 month low

Sometimes the counts like those above are a little harder to interpret, so we recalculated the above data in terms of the percentages for each group and came out with this chart:

percentages for each group

Now, it becomes clearer what is going on ... The stocks above $10 were making New Highs by a factor of 62.9% versus 37.1%. The stocks below $10 were making New Lows 56.6% of the time.

So, the majority of the stocks above $10 were making new monthly highs, while the majority of the stocks below $10 were doing the opposite ... making new monthly lows.

The message here, is that the investing advantage is for stocks that are over $10 in value now, and there is a clear disadvantage to investing in stocks that are below $10 in value.

Since larger investors such a Institutional Investors, mutual funds, and hedge funds prefer the higher priced stocks, this suggests that the bigger players are more bullish than the smaller players are ... who focus on cheaper stocks.

 


If you are not currently one of our paid subscribers, why not give it some thought this weekend?

 

Back to homepage

Leave a comment

Leave a comment