How You Can Make Money From Market Volatility

Matt Thalman - INO.com Contributor - ETFs


Based on a number of recent reports indicating the major indexes could end the year flat from where they sit today, I offered a few ideas on how investors could still profit during the last four months of 2017.

One of those ways was using Exchange Traded Funds that invest in the futures of the Volatility Index. For most investors, the CBOE Volatility Index or VIX or even the 'fear gauge,' is a rather complicated and confusing market measuring stick. So, today we are going to go through the 'ins' and 'outs' of the VIX and go into a little more detail on how the average investor can use the VIX ETF's to turn a little profit from time to time.

The CBOE Volatility Index (VIX) was designed to put a number on market volatility so investors could trade and make money based on the volatility of the stock market. This is achieved through the use of the futures market and options prices. The VIX tells investors the square root of the risk-neutral expectation of the S&P 500 variance during the following 30 calendar days.

The VIX is often quoted as a number, say 10, 20, 25. That number represents the expected annualized change, with a 68% probability of being true, of the S&P 500. So for example if the VIX is at 20, it would be predicting the S&P 500 will change up or down by 20% over the next 12 months. Continue reading "How You Can Make Money From Market Volatility"

Market May End The Year Where It Is Today, But You Can Still Make Money

Matt Thalman - INO.com Contributor - ETFs


A number of market participants have begun making year end predictions about where they believe stocks will finish. The predictions have the market finishing higher, lower, a lot higher, a lot lower, and right where it is today. Basically, no one really knows how the stock market will finish 2017 because no one can accurately predict the future.

But, when we look at the past, predictions have been made which aren’t as optimistic. Based on historical data a Goldman Sachs analyst has noted that when stock valuations have been where they are today, the market returns have been in single digits or negative.

Year-to-date the S&P 500 is already up 10.5%, which again compared to historical averages is an above average return. Furthermore, history tells us that we have market pull backs of 5%, 10%, and 15% rather often; about every 3 months, 8 months, and 14 months. We have not seen a 10% or 15% pullback in 2017. Continue reading "Market May End The Year Where It Is Today, But You Can Still Make Money"

Tech Stocks On a Run; ETF's To Buy 'IF' you Think It Will Continue

Matt Thalman - INO.com Contributor - ETFs


The NASDAQ (NASDAQ:COMP) has hit a number of new all-time highs in 2017. This has many analysts and investors wondering if the market and especially technology stocks are getting over-heated.

The Bulls will tell you that we are entering a new time of economic expansion and that technology is leading us forward. They say the higher than normal P/E ratios are due to the massive growth opportunities these companies still have moving forward.

The Bears, which I spoke about a few weeks ago, disagree and believe we are heading toward the next dot.com bubble. They say the 'Bulls' growth expectations are already built into tech stocks so much so that these companies are priced to perfection, which we all know is unlikely to happen.

Personally, I sit in-between both camps because I do believe some technology stocks will fail to meet expectations but others are completely changing how commerce is done, and because of their disruptive businesses, they will succeed. Continue reading "Tech Stocks On a Run; ETF's To Buy 'IF' you Think It Will Continue"

Tech Stocks On a Run; ETF's To Buy 'IF' you Think It Will Soon Come to An End

Matt Thalman - INO.com Contributor - ETFs


The Bears have been referring to the current situation with technology stocks as the building up of the next dot com collapse. Price to earnings ratios are high, earnings expectation may be overinflated, and the unknown that surrounds all aspects of the current political landscape and how that could affect businesses are all reasons to be doubtful that technology stocks can continue on their massive run.

One analyst believes you should buy any of the technology stocks that garner a large portion of their revenue from advertisements. The analysts noted that companies like Facebook (NYSE:FB) and Alphabet (NASDAQ:GOOG) are likely to experience a revenue slowdown in the future because, at the end of the day, there is only so much money that can be thrown at web-based advertising.

Others think Amazon.com (NASDAQ:AMZN) may be getting too big and trying to do too much, and it could end up destroying itself. Sounds similar to what the bears say about Tesla (NASDAQ:TSLA).

At the end of the day, a negative case can be made about every single technology stock. If you agree with those cases and you want to start looking for some opportunities to make money when technology stocks start falling, then let's take a look at some or your options I have outlined below. Continue reading "Tech Stocks On a Run; ETF's To Buy 'IF' you Think It Will Soon Come to An End"

How To Profit From The Amazon-Whole Foods Deal Before It Happens

Matt Thalman - INO.com Contributor - ETFs


The announcement that Amazon.com Inc. (NASDAQ:AMZN) had made an offer to purchase Whole Foods Market Inc. (NASDAQ:WFM) sent the grocery stocks plummeting. While some experts think Amazon's move into the grocery business is a great idea, others aren’t so sold on the idea.

Regardless of whether this move by Amazon is good or bad for Amazon, the grocery sector was punished by this news and I don’t think stocks like The Kroger Co. (NYSE:KR) deserved to fall nearly 10% on the news. Or even Wal-Mart Stores Inc. (NYSE:WMT), Target Corporation (NYSE:TGT), Costco Wholesale Corporation (NASDAQ:COST) all losing billions in market capitalization just because Amazon is buying Whole Foods.

Really? Continue reading "How To Profit From The Amazon-Whole Foods Deal Before It Happens"