Big bull Tom Lee admits: 'August scares us' and here's why
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Big bull Tom Lee admits: 'August scares us' and here's why
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Big bull Tom Lee admits: 'August scares us' and here's why
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| Big bull Tom Lee admits: 'August scares us' and here's why |
Big bull Tom Lee admits: 'August scares us' and here's why
Big bull Tom Lee admits: 'August scares us' and here's why - here are the reasons??
Strategist Tom Lee is known for perennially serving as one of the biggest bulls on Wall Street, but when asked about the month ahead, he's striking a markedly cautious tone.
"August scares us," the co-founder of Fundstrat Global Advisors said Monday on CNBC's "Trading Nation." He pointed to two troubling stats in particular.
Lee observes that going back to 2009, the S&P 500 has fallen an average of 6 percent during the month of August — a stat that jibes well with the "sell in May and go away" line of thinking.
This adds up to a "pretty scary" outlook for next month, Lee said. However, after an August slip, Lee expects a fall rip.
Or, as the strategist memorably put it in a recent note to clients: "sell the beach, buy the teach."
More specifically, Lee says that once the S&P falls to 2,100, "we think you should buy it," in anticipation of a substantial rally to Lee's 2,325 year-end price target. It closed Monday at 2,168.48.
Indeed, the long-term minded "shouldn't do anything, because a 2 to 3 percent sell-off isn't enough to warrant a big shift in a portfolio. But 2 to 3 percent for an active manager is relative performance."
Further, the odds of a slip could be even greater this year, given that "the bond market has become a lot more volatile than equities, and whenever this happens, 68 percent of the time, the stock market falls in the following month."
Here is a daily chart of BONDS....man, Oh, Man, what a rollercoster ride ey? You can see the rising support line has been touched a few times but now. Hmmmmm. So its safe to say we are at a make or break area.
Big bull Tom Lee admits: 'August scares us' and here's why - here are the reasons??
Strategist Tom Lee is known for perennially serving as one of the biggest bulls on Wall Street, but when asked about the month ahead, he's striking a markedly cautious tone.
"August scares us," the co-founder of Fundstrat Global Advisors said Monday on CNBC's "Trading Nation." He pointed to two troubling stats in particular.
Lee observes that going back to 2009, the S&P 500 has fallen an average of 6 percent during the month of August — a stat that jibes well with the "sell in May and go away" line of thinking.
This adds up to a "pretty scary" outlook for next month, Lee said. However, after an August slip, Lee expects a fall rip.
Or, as the strategist memorably put it in a recent note to clients: "sell the beach, buy the teach."
More specifically, Lee says that once the S&P falls to 2,100, "we think you should buy it," in anticipation of a substantial rally to Lee's 2,325 year-end price target. It closed Monday at 2,168.48.
Indeed, the long-term minded "shouldn't do anything, because a 2 to 3 percent sell-off isn't enough to warrant a big shift in a portfolio. But 2 to 3 percent for an active manager is relative performance."
Further, the odds of a slip could be even greater this year, given that "the bond market has become a lot more volatile than equities, and whenever this happens, 68 percent of the time, the stock market falls in the following month."
Here is a daily chart of BONDS....man, Oh, Man, what a rollercoster ride ey? You can see the rising support line has been touched a few times but now. Hmmmmm. So its safe to say we are at a make or break area.
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| Big bull Tom Lee admits: 'August scares us' and here's why |
WHAT IF YOU KNEW WHICH WAY THE MARKET WAS ABOUT TO MOVE BEFORE IT HAPPENED? CLICK HERE To Join Our VIP ELITE GROUP -- FREE!
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