Investing.com investing.com 20 Dec, 2020 07:15 am

Overly Bullish Speculators Front-Run 'Santa Claus'

Overly Bullish Speculators Front-Run 'Santa Claus'
Stocks Analysis by Lance Roberts covering: S&P 500, SPDR S&P 500, S&P Composite 1500. Read Lance Roberts's latest article on Investing.com

An excellent example of this dichotomy is the Yale Stock Market and Valuation Confidence Indexes.Valuation Confidence, from both individual and institutional investors, is at the lowest levels on record.(Index is inverted) Confidence In Valuation Levels - Composite The chart below shows the combined average of institutional and individual investor valuation confidence subtracted from future returns confidence.Market Less Valuation Confidence Composite Such is the same phenomenon famously described by former Fed Chair Alan Greenspan in a December 1996 speech on “Irrational Exuberance.

It looks at market performance over a seven day trading period – the last five trading days of the current trading year and the first two trading days of the New Year.3% on average during the 7 trading days in question since both 1950 and 1969.

Read full story at investing.com