If you think the migration of trillions of dollars into passive investing strategies has put volatility to sleep, you’re absolutely right – for the most part it has.
But what if blanket indexing isn’t the dream investment it’s cracked up to be?
What if the mad rush into passive investing vehicles merely casts a shadow over volatility?
What if passive investing is a black swan and it unleashes the volatility that crashes markets?
We’re going to find out – maybe sooner than later.
Here’s how passive investing masks real volatility and what to do to protect your investments from the inevitable return of volatility with a vengeance.
Passive Investing Is Indexing
Instead of trying to beat the market by being a stock picker, an increasing number of academics, Wall Street advisors, and product pushers are telling individual investors and some institutional clients that simply tracking the market by buying index funds is cheaper, less risky, and guarantees you won’t do worse than the market.
equity market: Wynn Resorts, Limited(WYNN)
- [By Travis Hoium]
But Las Vegas Sands Corp. (NYSE:LVS) may not have had as strong a quarter as competitors like Melco Crown Entertainment Ltd (NASDAQ:MPEL) and Wynn Resorts, Limited (NASDAQ:WYNN). We’ll have to wait until the latter two report earnings to see how market share is trending, but Las Vegas Sands left a lot to be desired from a growth perspective.
- [By Jason Hall, Travis Hoium, and Brian Feroldi]
In our ongoing search for just such quality growth stocks, we asked three of our contributors to pick out ones they think have high growth potential from here, and tell us why. They gave us a unique retailer that’s carving out a huge following in Duluth Holdings(NASDAQ:DLTH), a recovering fast-casual dining darling inChipotle Mexican Grill (NYSE:CMG), and a gaming and resorts giant,Wynn Resorts (NASDAQ:WYNN).
- [By Ben Levisohn]
Wynn Resorts (WYNN) soared to the top of the S&P 500 today after its earnings fell short of the Street consensus but sales beat.
Wynn Resortsgained 7.9% to $103.08 today, while the S&P 500 dipped 0.1% to 2,294.69.
Gabelli’s Adam Trivison argues that Wynn’s earnings weren’t that bad:
On January 26, 2017, Wynn Resorts reported 4Q16 results in-line with our expectations, but after accounting for a $6 million negative hold impacted to EBITDA, underlying performance looks better than expected. Commentary on January-to-date performance at Wynn Palace and Wynn Macau was promising. We have adjusted our estimates to account for a more even balance between Wynn Macau and Wynn Palace than we had previously anticipated.
Wynn Resorts’ market capitalization rose to $10.5 billion today from $9.7 billion yesterday.
Barron’s Teresa Rivas recommended buying Wynn Resorts last May, when it was trading around $90 a share.
- [By Rich Duprey]
The big casinos certainly want to spend big. Las Vegas Sands (NYSE:LVS) says a new integrated resort in Japan will cost anywhere from $6 billion to $10 billion, two to three times more than it spent on building its brand new French-themed Parisian resort in Macau. MGM Resorts (NYSE:MGM) says it, too, could spend $10 billion for a new casino in Japan, quadruple the cost of its MGM Cotai that’s scheduled to open later this year. Wynn Resorts (NASDAQ:WYNN) hasn’t put a price tag on it yet, though it spent over $4 billion to open the Palace in Macau last August, but CEO Steve Wynn says the opportunity is “thoroughly delicious.”
- [By Wayne Duggan]
Bernstein maintains Outperform ratings on Melco Crown Entertainment Ltd (ADR) (NASDAQ: MPEL) and the China units of Wynn Resorts, Limited (NASDAQ: WYNN) and MGM Resorts International (NYSE: MGM).
equity market: Paradise, Inc. (PARF)
- [By SEEKINGALPHA.COM]
Paradise Inc. (OTCPK:PARF)
This company is focused on producing candied fruit, which is the basic ingredient of fruitcakes a dessert popular during Thanksgiving and Christmas in the US. They also produce their own plastic containers for these. While this product might not be wildly popular or its demand increasing, the company has a commanding portion of the market share (as mentioned by the management) and its sales have been stable and the company is able to be profitable.
equity market: Apple Inc.(AAPL)
- [By WWW.KIPLINGER.COM]
Despite being the second-largest company in the world by market cap, Alphabet doesnt pay a dividend at all. Apple Inc. (AAPL) and Microsoft Corporation (MSFT), who are first and third on the list, respectively, have become very reliable dividend payers in recent years. In fact, Id go so far as to call both dividend-raising machines.
- [By Paul Ausick]
Apple Inc. (NASDAQ: AAPL) traded up 0.74% at $144.77. The stock’s 52-week range is $89.47 to $144.89, a new 52-week set this afternoon. Volume was about 35% below the daily average of around 27 million shares. The company said it will launch revamped versions of its desktop Mac Pro computer in 2018.
- [By Jack Delaney]
Snapchat already has the software in place for users to share images and videos. But it also wants to control the hardware to create an ecosystem like Apple Inc. (Nasdaq: AAPL) and Amazon.com Inc. (Nasdaq: AMZN).
- [By Paul Ausick]
Apple Inc. (NASDAQ: AAPL) and Qualcomm Inc. (NASDAQ: QCOM) began slugging it out in courtrooms around the world early this year when Apple filed suit against the chipmaker seeking a rebate of nearly $1 billion in patent royalty payments. The relationship has gone downhill ever since.
- [By Paul Ausick]
The DJIA stock posting the largest daily percentage loss ahead of the close Tuesday was Apple Inc. (NASDAQ: AAPL) which traded down 2.63% at $170.41. The stock’s 52-week range is $114.76 to $177.20. Volume was nearly 10% above the daily average of around 26 million shares. Some analysts said iPhone X sales would be down sharply from quarterly.
- [By Vikram Nagarkar]
Shares of Cupertino, California-basedApple Inc (NASDAQ:AAPL)have been making new highs lately. On the 15th of March, AAPL stock closed the day above the $140 mark for the first time post its 2014 stock split, recording its all-time closing high of $140.46 a share. Apple shares are now up by close to 10% in March alone, and as it appears, the stock seems to have entered overbought territory. In fact, multiple technical indicators currently suggest that a correction could be on the cards.
equity market: Diageo plc(DEO)
- [By Jayson Derrick]
Given this less than favorable outlook, the analysts downgrade Diageo plc (ADR) (NYSE: DEO)’s stock rating from Buy to Hold with a price target on the U.K.-listed stock of GBP25.50.
- [By Leo Sun]
Retirees should generally invest in companies with wide moats and solid dividends. In a previous article, I noted that AT&T and Unilever were easy-to-understand companies that were ideal for most retirement portfolios. Today, I’ll add two more companies to that list — alcoholic beverage giants Diageo (NYSE:DEO) and Anheuser-Busch InBev (NYSE:BUD).
- [By Mark Fritz]
Brown-Forman Corporation (NYSE: BF.B): Hold.
Price Target: $46.00.
Davide Campari Milano SpA (ADR) (OTC: DVDCY): Buy.
Price Target: 7.40 euros.
Diageo plc (ADR) (NYSE: DEO): Hold.
Price Target: 25.50 pounds.
PERNOD RICARD EUR1.55 (OTC: PDRDF): Hold.
Price Target: 98 euros.
REMY COINTREAU EUR1.60 (OTC: REMYF): Hold.
Price Target: 99 euros.
The authors relied on U.S. Census data, industry sources and the National Survey on Drug Use and Health.