How To Invest Long Term Without Losing Your Fannie … Mae

Reaping the windfall benefits of a sharp decline in Fannie Mae’s shares took patience, tenacity and some follow-up analysis. Here's how our EWI analysts prepared subscribers for Fannie's downfall, starting back in 2002.

The Power of Myth and Your Portfolio

When it comes to mutual funds, the truth is this: An ever-larger number of people give their money to an ever-smaller number of managers, who in turn oversee the taking of an ever-bigger slice of the pie.

6 Ways Elliott Wave Helps You Trade Better
Learning Elliott wave analysis may be a challenge, but it's well worth it.

Silver Standard Resources (SSRI): Clear, Unmistakable Opportunity
Does Elliott wave analysis work stock by stock?

Elliott Wave: It's All About "Fives and Threes"
Counting Elliott wave in real-time market charts can be a bigger challenge than it seems.

Regardless of how new you may be to Elliott wave analysis, you know that it's relatively easy to follow professionally produced wave counts in market charts. But if you've ever tried to do your own wave counts while trading, you know how big a challenge it can be. Well, here is a solution.

Smoke & Mirrors Hide Bigger Losses on Wall Street

Citigroup and Merrill Lynch use good old smoke and mirrors -- otherwise known as modern-day accounting -- to delay losses on their income statements. But there's a much clearer picture and forecast from The Elliott Wave Financial Forecast.

Mutual Funds: The Greatest Financial Irony in History
Can 90 Million People and $10 Trillion Be Wrong?

The author explains the big-picture reasons why the mutual fund industry amounts to a deck stacked against investors, including how "management companies are independently owned, separate from the funds themselves," and that "managers profit by maximizing the funds under management because their fees are based on assets, not performance." He also notes other curious facts -- such as how the years from 1980 to 2004 saw the rate of increase in fees in stock mutual funds exceed the rate of increase in fund assets....

Do Stocks Reflect The Economy?

"Earnings Season" for Some, "Stupid" Season for Others?
AKA, If losses are "good," big losses must be "better"

Literally hundreds of headlines today that said "Stocks surge on profit reports from Citigroup...", "U.S. stocks rally on Citigroup earnings...", etc., etc., etc. Those headlines would of course be plausible if Citi had indeed reported positive earnings. However and alas, the teeny-tiny detail that some of these stories didn't even see fit to mention was that Citigroup didn't HAVE any earnings in the previous quarter, because earnings are PROFITS. Instead, what Citigroup DID have were "negative earnings," which is a two-word definition for one word, namely LOSSES.

Gold Stocks: Buyer Beware?
What if you accepted (if only for a minute) the idea that markets are not random, but patterned?

If you happen to be a proponent of the “random walk” theory, let’s – for now – leave alone the debate about “random” vs. “patterned" markets and focus instead on the benefits of accepting (if only for a minute) the idea that markets are indeed patterned. The benefits are numerous and obvious; the main has to be this...

What's Worse Than Overestimating a Gain?
(Hint: An Estimate That Amounts to the "Biggest Miss Ever)

The overwhelming consensus of Wall Street's analytical opinion was bullish on earnings regarding the entire second half of 2007. As Q3 began, the average estimate was for an earnings gain of 5.7%, though by that quarter's end the estimate was cut to a 2.7% gain. The actual final earnings report showed a 2.5% decline. Undeterred, analysts began Q4 with an average estimate of 10.9%, though by that quarter's end the estimate was cut to a 7.9% decline. The actual final earnings report showed a decline of 22.6%. That's an overestimate of 33.5 percentage points, which Bloomberg described as "the biggest miss ever"...

Real Forecasts vs. Guesswork After the Fact
Or, How "Subprime" Makes Prices Go Up, Down, and Sideways

Logic and a heap of recent history be damned -- or, perhaps, it's the vain fondness for consistency which unleashed the hobgoblins into my little mind. "News" Flash: Bearish news isn't bearish if the stock market goes up. If you and I don't know the difference beforehand, well, too bad. It must be our fault.

The Anguish of A Lost Decade
Or, Why Buy and Hold Investing Can Steal in More Ways Than One

Which is to say, equity investors collectively nearly always underperform the major indexes. And that's a fact I did not glean from the Wall Street Journal, but instead from the March Elliott Wave Financial Forecast. And if you think that the article I quoted above made buy & hold investing look unappealing, here's what that issue of EWFF (published Feb. 28) said...

Fibonacci Numbers: Still Useful After All These Years
Elliott Wave International describes the concept of Fibonacci numbers and their use in forecasting the markets.

Leonardo Fibonacci of Pisa was the most important mathematician of the Middle Ages. In 1202, he wrote a landmark book on arithmetic, which popularized the decimal and Hindu-Arabic numbering system that we use today. His other discovery, what we now call "Fibonacci numbers," has had a profound impact on the analysis of modern financial markets.

Stocks: Running Scared, But Opportunities Still Present
Elliott Wave International tries to answer the question -- just WHAT, exactly, is the "economy" and "the markets"?

Most people talk about the economy like it’s something that exists separately from them. Like it’s a hot-air balloon floating up in the sky. That’s us, here on earth, feet on the ground, and there’s the economy – up there, see it? But just what IS economy? Or "the markets," for that matter? Let's take a closer look.

Do the Stock Indexes Actually Show How Investors "Are Doing"?
Stock Market Myths 101

After all, half the households in America own equities via 401k accounts, mutual funds, IRAs, common stocks, etc., etc. Whatever the vehicle, people who own equities get in for "the long term." The "rational" advice of nearly all financial "experts" is for people to "buy and hold" in bull and bear markets. So that's exactly what investors do.
Right?
If you believe that, dear reader, then have I got a Biscayne Bay condo for you. The "experts" may well drivel on about how people should buy & hold, but any claim that most investors actually do so during bull and bear markets is complete rubbish....

'Buy-and-Hold' -- A Bull Market Trait?
Do financial investors act "rationally" when making decisions about when to buy or sell stocks?

More times than we can count, financial investors act completely against reason. The harder stocks fall, and the worse the economic data, the stronger becomes the public's faith in the future of the overall market. "Rational"? We think not. Regular -- however -- it is very much so. Seeing is believing via our graphic illustration...

All the Bad News That's Fit To Print, & the Dow Still Heads Up

If ever there was a day when bad news should drag the financial markets down, Tuesday, February 26, 2008, was it. But instead, the markets all closed up, with the Dow leading the way, up nearly 115 points.

Bad News Delayed is Still Bad News

We suggest getting off the addiction to following the news and the delayed reporting from companies and getting ahead of the curve by following the Wave Principle.

What Next for our Humpty Dumpty Markets?

The U.S. President, the Fed and all the central bankers and financial whizzes in the world are trying to put our Humpty Dumpty economy and financial markets back together again. But they aren't having much luck.