Another sentiment indicator turns Bullish: the Specialist to Public Short Ratio (60 year chart), is at a levels which in the past have been associated with intermediate lows.

Ratio: NYSE Specialist / Total Short Ratio
nyse_specialist_short_ratio.bmp
Source: Investech Research

Specialists themselves may not be bearish, but often turn out later to be right because the public or the “crowd” was wrong. In declining markets, it’s the public who is doing the selling (and shorting) and the specialists who must buy to maintain an orderly market – even if they are not bullish at all.

Random Items:
The myth about risky cyclical stocks
A Year After Iraq War
The Outsourcing Bogeyman
American vs. European Welfare
Geopolitical tensions ate my portfolio
Easy Al’s 1% Wonder

Quote of the Day:
“The CROWD is always wrong at market turning points but often times right once a trend sets in. The reason many market fighters go broke is they believe the CROWD is always wrong. There is nothing further from the truth. Unless volatility is extremely low or very high one should think twice before betting against the CROWD.”
-Shawn Andrew, Ricercar Fund

Category: Finance

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

Comments are closed.