The Russian/Ukraine ordeal is dominating the action right now.
The market is also in the process of pricing in some interest rate hikes and QE tapering.
We’ve had wars before.
The Fed has raised rates in the past.
There is really nothing new under the sun.
The S&P 500 is down -11.34% YTD.
The Nasdaq is down -16.67% YTD.
The small caps are down -13.27% YTD.
ARK innovation fund (ARKK) is down -35.64% YTD and -56% from its 52 week high.
Some of these stocks ARKK stocks will never come back.
Like always, individual stocks have fair a lot worse than the indices.
46% of Nasdaq stocks are down at least -50% from their 52-week high; that’s astonishing.
53% of S&P 500 stocks are down at least -20% from their 52-week high.
83% of Small Caps are down at least -20% from their 52-week high.
The market is a forward pricing mechanism. Eventually, the market will find a level where it feels comfortable with all the headlines and headwinds. It always does.
As for us, we have been weathering the storm pretty well, with heavy cash and timely shorts. Most accounts are around the flat line, give or a take 1%. That’s not bad, considering that most accounts have about 25% of their assets in market ETF’s.
The good news is that everything has an ending. And this correction, like all the other corrections, will eventually end.
In the meantime, we will continue to protect the accounts.
Great graph from @charliebilello
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