The post earnings nap occurs almost every quarter right after earnings are out. It is at that point that the market has already reacted to corporate earnings which typically flatlines or declines because there isn’t any more “new” good news available to drive stocks higher.
In fact, with an absence of good corporate news available, investors tend to focus on the headlines and current events, which are certainly not stellar at the moment. So, for the next couple of months, expect less investment talk and more negative political, ISIS, and Russia rhetoric.
August usually brings with it the summer doldrums. The traders and hedge fund managers are all in the Hampton’s, living the life of Bobby Axelrod, without the stress of the market on their mind. With the big money on the sidelines, unwilling to take on new large positions, stocks have a hard time going up.
The next few months could be tough. The best way to get through these dog days of summer is to have an extra bottle of wine or a few more beers with your family BBQ’s, and don’t panic at the headlines. And of course reading my book: Surfing the Retirement Tsunami – Your Guide to Staying Afloat and Retiring Comfortably.
As long as your portfolio is properly managed “Tactically” (never passively or buy-and-hope), and set up properly to get you the best returns with the least risk possible, you should get through these crossroads unscathed. If it isn’t, get on it before it’s too late!
If you have any comments or questions, feel free to drop me a line.