Major Stock Market Correction in 2013 for S&P 500 Predicted by REO Capital
Genuine Trading Solutions President and CEO, Dwayne Strocen announced today "The stock market indices of the United States and ultimately world markets are poised for a major correction in 2013".
by john denes Monday, January 28, 2013
Genuine Trading Solutions President and CEO, Dwayne Strocen announced today "The stock market indices of the United States and ultimately world markets are poised for a major correction in 2013". He cites his reasons as follows:
The CBOE Volatility Index or VIX is widely considered the best gauge of fear in the market and has an inverse relationship with the major indices such as the S&P 500. On Friday January 18, 2013, the VIX closed at a five and a halfyear low of 12.46, indicating optimism and good times ahead. A level not previously seen since April 2007, one year prior to the great recession of 2008. Traditionally known as the euphoria phase of an economic cycle, it is also the harbinger for a stock market correction, catching by surprise both the professional and amateur investor alike.
While the economy is far from firing on all cylinders the Stock markets are now flirting close to all time highs. It is then with no surprise that inverse to the VIX, the S&P 500 closed Friday at 1480.94. A level itself not previously seen since December 2007, though still shy of its all-time high set two months previous. While in over-bought territory, the S&P is not yet considered dangerously over-bought. It all comes down to too much too fast. Yetthe long term indicators seem to indicate there is more to be concerned about.
The technical indicators are not suggesting an imminent correction within a matter of days. They do suggest a more likely scenario of possibly sometime in the spring of this year. “While we are not contrarians”, Says Mr. Strocen. “It would be imprudent not to stand-up and take notice of the obvious.” “We believe there is still some profits for the taking, but we are doing so cautiously always aware that when corrections do materialize, they tend to do so without much warning and always taking investors by surprise. As a firm concerned with managing market risk, we are doubly cautious going forward and managing our USA Index accordingly.”
The stimulus for any large correction could come from any number of sources. As we experienced with the Greek crisis, the catalyst for such an event may not be within the control of local government or within the ability of regulators to forecast or foresee. Such events tend to exceed international borders and if occurs, will likely affect global markets and their exchanges.
To diversify your Institutional portfolio into Private Equity & Hedge Fund Investments email us at REO Capital to discover which funds we represent that could increase your ROI.
REO Capital, LLC
Johndenes at reocapitalllc.com
Prior to Starting REO Capital, John was the Chief Development Officer of a Leading Technology company where he ran the Private Equity Department for the firm. John was also with a Clean Tech Private Equity firm where he was the Director of Capital Development raising capital from Institutional Investors for their Biofuels funds. John also served as a VP of Institutions for a Global Macro Long Short Hedge Fund. John is also the Managing Partner of DeBere Partners US operations and jointly manages the company''s fundraising and investment business with a joint venture betweens firms. John has been personally involved in raising capital for various projects with institutional investors for the past 13 years. John was a Quantitative Portfolio Manager at Prudential Securities and was a frequent speaker at various colleges for the "Fundamental & Technical Analysis of Equities". John graduated from the Harvard of Aviation - Embry Riddle Aeronautical University in Daytona Beach, Florida with honors and recieved his Bachelors of Science in Aeronautical Studies. Later went on to recieve his MBA in Finance.
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