Were you aware that the bond market is more than double the size of the stock market?
Most people are surprised by this simple truth. Now, factor in the reality that if you include loans into the numbers it is close to four times the size of the equities market.
What does that mean for us as investors? And, more importantly, how do we leverage this information to our advantage to create an edge in the markets?
If we take a quick look at the chart below of the 30-year bond futures, we can see a few interesting bits of information if we understand how to read Price. What I would like to focus on specifically is how the buyers (purple highlighted bars) blast through the previous area of sellers (pink highlighted bars) -- note how vertical the bars are on the decline and rise. This type of velocity represents one of the most valuable insights we can gain from a chart, the supply vs. demand imbalance. Can you see it?
Now, lets take a look below at what happened after the buyers tried to continue the rally higher after the initial surge through where the sellers had bailed in late 2016. Can you see how Price paused for a few weeks, then all of a sudden slammed back through the zone only to head right back the original launch zone in a similar vertical fashion? This is invaluable information that can truly only be read on a chart.
Knowing that the domestic bond market is roughly $40 trillion and the US stock market is less than $20 trillion...which piece of data should we prioritize as investors? In other words, which market is holding or controlling more gold?
Let me know what you think and PLEASE don't take my word for it or judge me based upon a single qualification on a CV, or something I accomplished in middle school or even something from last year...we are only as good as our last challenge bested.
The truth is, if a so-called professional can't show you in real-time where a particular stock or market is headed, then they are guessing (and sadly most are because they have mastered a skill set in sales, relation building, or just a slick haircut, as opposed to reading the markets which can take a lifetime to develop).
If you don't believe investing can be this simple -- then set up a time on our calendar for a "7 minute non-pitch" where you can pick any stock and we'll show you how to buy, sell or hold it like a hedge fund manager (a really savvy one, not the guy in his parent's basement writing code for an algo that works for a month then blows up).
Or just keep making the same mistakes so the pros can keep eating your lunch. Either way ----> It's Your Time, Your Money and Ultimately Your Choice.
We wish you the best on your journey to becoming a more opportunistic investor!