Maverick Charts - March 2023 Edition #5
Cherry picked charts for interesting insights via short reads. This edition: S&P 500 & Rates, FED pricing, ETF flows, Stocks & Bonds, Retail Investors & Big Tech
Dear all,
welcome to the 5th edition of Maverick Charts, a dedicated section from Maverick Equity Research where I cherry pick 20 various charts from various contributors with the goal to provide interesting research insights via short reads. Enjoy it!
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The most recent on Macro & General:
Via Maverick Equity Research: S&P 500 at least priced in already last year a / 'the' most anticipated recession in history, even a mini-rally in 2023, or? Overview:
👉 40 years of US interest rates with red bars recession
👉 S&P 500 quarterly returns & drawdown
👉 via Avery: Great to see all the tenors lined up with drawdowns and the periodic returns - I think this gives a better view as to what investors might expect with regards to rates/equity correlation
👉 Complementary given was asked via DMs: same but replaced S&P 500 drawdown with it's mighty Price Return (bottom blue): +2,217%
👉 N.B. that's ‘just’ price return, guess how much bigger with dividends reinvested? 6,000% for a 11.18% compounded annual growth rate (CAGR) … Let that sink in! …
Side note: it was great to see the one and only Danielle DiMartino Booth liking & retweeting …
Via Capital Flows: Fed Funds Futures pricing rate cuts
Via & Luis Torras & Citi: Even as the central banks have told us they’re going to be tightening, it turns out that on at a global level, they’ve just added $1 trillion worth of liquidity over the past three months
Via The Mad King: Central banks boxed in! No way out but to revive QE
Via Kurang Patel: Notional ETF flows to monitor sector rotations within US Equities : currently the sectors experiencing the largest inflows compared to their averages include Treasury and Telecommunications, while outflows are being seen in Large Cap and Small Cap
Via Michael A. Arouet & Pictet: Have US banks really assumed that people will happily keep their money as deposits earning 0,5% given all the alternatives?
Via Refinitiv & Fathom Consulting: EU consumer confidence rose again after its trough in September
Via Michael A. Arouet & Reuters: At least one piece of all the various inflationary pressures has already normalized
Via Le Sideline Shrub & Bloomberg: New Orders compared to Inventories have only been as depressed as the oil embargo in 1973, at the worst of GFC in 2009 and Covid in 2020 …
Via Joey Politano: People really, really, really do not like high mortgage rates
From the world of Stocks & Bonds:
Via Maverick Equity Research, VC & BofA, a great visual with 90+ Years of combined Stock & Bond portfolio returns!
👉Best, Worst & Average returns via various ways to mix stocks & bonds
👉check the classic 60/40
Bonds typically serve as a hedge against portfolio losses thanks to their negative historical correlation to stocks. Outliers are always interesting:
👉 2022 was quite one - correlation got back!
👉 the last time stocks & bonds moved together in a negative direction was in 1969
Over the last century, cycles of high interest rates have come & gone. Both equity & bond returns have been resilient for investors who stay the course ... . The 60/40 portfolio set for a comeback? Hard to have 2 big outliers 2 years in a row imo. How is 2023 looking so far a key question, no? As of February, rebound is here ...
Via Edelweiss Capital: Great businesses tend to remain great, or they become good businesses (combined probability of 79 percent).
Via Anne Cronin & Lu Wang (Bloomberg): All those stock market pessimists may actually be helping this year's rally. For more, link.
Oktay Kavrak, CFA & BofA: S&P 500 in 20th bear market past 140 years. On average: Duration is 289 days & Decline 37.3% peak to trough. We are now in a longer-than-normal bear market
Via AlessioUrban & FT: Retail investors have piled into US markets this year
Via Ayesha Tariq, CFA & MS: Morgan Stanley cut Schwab's rating to equal weight based on the fact that cash sorting not improving as they had hoped, more intense regulation and pressure on earnings. It's not a deathblow/ This is the most interesting part of the report ⤵️
Via Maverick Equity Research: Apple 2022 total sales = $394 billion. Breakdown: 👉 52%from iPhone
👉17.6% Mac & iPad
👉10.5% Wearables, Home and Accessories (Apple Watch, Airpods etc)
👉20% from Services
~20% from Services = small/big? Bigger than Nike & McD combined. Let that sink in!
Via The Transcript & GS: Relative to the market, banks’ equity volatility is already nearing previous crisis levels
Via jeroen blokland: The market cap of 'Big Tech' is up a whopping 24% since the start of the year. This is the sole reason why US equities are holding up. However, the total market cap of Big Tech is still down a whopping 32% from its peak.
Via Athanasios Psarofagis: Big win for QQQ this week not having any financial exposure. Best week over SPY going back to 2008.
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Have a great day!
Maverick Equity Research
Definitely Maverick Charts! Great job 👏
Thanks