Monthly Archives: July 2015

Commodity markets, Market outlook

When to buy gold in 2015/2016: Gold is a way to avoid the market crash in the near future

In early 2015, the gold price remained approximately $1150-1250, but as the Chinese economy slowed down, the price finally fell below $1100 in July.

As the Fed was going to rise the interest rate, the bear market itself was predicted by some investors. When the rate rises, the higher yield makes the dollar more attractive, and as a consequence, the gold price, traded in USD, decreases.

However, now we have another influential factor: the slowdown of the Chinese economy, which became more serious than before. So in this article, we contemplate on the two factors that affect the gold price and explain why gold is still a way to avoid the upcoming market crash in a few years.

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Market outlook, US stock market

Fed rate hikes will reverse portfolio rebalancing and end QE bubbles

The investors are trying to be prepared for the Fed’s raising the interest rate in late 2015 and 2016, worried about how much it could affect the markets, but they seem to have forgotten what has been supported the markets for several years.

Have we already overcome the termination of the Feds’ QE? The answer is no. Although the interest rates are kept relatively low, and the US stocks remain near the all-time high, the markets are just supported by QEs by Bank of Japan and European Central Bank.

The portfolios of the investors of all kinds have been distorted by the QEs. According to the paper by the Fed, due to the QE the owners of Treasury securities and MBS shifted their funds into riskier assets. For example, the households sold Treasury bonds and MBS to the Fed and bought riskier assets such as corporate bonds, commercial paper and municipal debt and bonds.

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Trading strategies

How to evaluate growth stocks with fundamental analysis

This article explains how to evaluate growth stocks with fundamental analysis.

First of all, growth stocks are stocks that are highly appreciated in the markets due to their expected future growth, even though at the moment they haven’t yet achieved any notable profit.

The P/E ratios of those stocks sometimes exceed 100. It seems that this kind of evaluation simply ignores the fundamentals, but the prices of the growth stocks are actually decided by evaluation based on the fundamental analysis.

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Stocks, US stocks

Iran nuclear deal and sanctions relief could boost oil tanker stocks

On 14 Jul, the West and Iran agreed to freeze Iran’s nuclear programme and, in exchange, gradually relieve the sanctions on the Iranian economy.

This agreement allows Iran to export oils and natural gas to the western countries to increase the oil supply of the world, which has already been greater than the demands. Iran has the 4th greatest oil reserves and the 2nd greatest natural gas reserves in the world.

The oil prices have already been declining due to the US shale oil and Saudi Arabia refusing to decrease its production, but the markets haven’t fully reflected the benefit that oil tankers would get from the increasing oil supply.

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