2020 Outlook — The Year in Headlines
Our 2020 Bespoke Report market outlook is the most important piece of research that Bespoke publishes each year. We’ve been publishing our annual outlook piece since the formation of Bespoke in 2007, and it gets better every year! In this year’s edition, we’ll be covering every important topic you can think of that will impact financial markets in 2020.
The 2020 Bespoke Report contains sections like Economic Cycles, Economic Indicators, The Fed, Sector Technicals and Weightings, Stock Market Sentiment, Housing, Commodities, and more. We’ll also be publishing a list of our favorite stocks and asset classes for 2020 and beyond.
We’ll be releasing individual sections of the report to subscribers until the full publication is completed by year-end. Today we have published the “The Year in Headlines” section of the 2020 Bespoke Report, which recaps all of the year’s major financial headlines overlaid on a chart of the S&P 500 on a month to month basis.
To view this section immediately and all other sections, become a member with our 2020 Annual Outlook Special!
2020 Outlook — Seasonality
Our 2020 Bespoke Report market outlook is the most important piece of research that Bespoke publishes each year. We’ve been publishing our annual outlook piece since the formation of Bespoke in 2007, and it gets better every year! In this year’s edition, we’ll be covering every important topic you can think of that will impact financial markets in 2020.
The 2020 Bespoke Report contains sections like Economic Cycles, Economic Indicators, The Fed, Sector Technicals and Weightings, Stock Market Sentiment, Housing, Commodities, and more. We’ll also be publishing a list of our favorite stocks and asset classes for 2020 and beyond.
We’ll be releasing individual sections of the report to subscribers until the full publication is completed by year-end. Today we have published the “Seasonality” section of the 2020 Bespoke Report, which looks at long-term seasonal trends for the equity market, individual sectors, and asset classes, as well as a rundown of which periods and time of year have been the most positive and negative for equities.
To view this section immediately and all other sections, become a member with our 2020 Annual Outlook Special!
Worst Stocks of the Decade
While there have been a lot of big winners in the stock market in the past decade, there have been a number of big losers as well. The table below lists the 15 stocks that are down the most over the last decade but still haven’t been booted from the S&P 1500. The worst performing stock on the list is Frontier Communications (FTR) which is down over 99%! At the end of the last decade, FTR was a $117 stock, but in the span of ten years has managed to shed over $116 of that share price! After FTR, nearly all of the biggest losers are from the same sector. You guessed it! Energy. The only non-Energy stocks shown are JC Penney (JCP) and Acordia Therapeutics (ACOR).
What’s really unbelievable about the fact that the remaining twelve stocks on the list are from the Energy sector is that there are just 89 stocks in the S&P 1500 Energy sector. In other words, one out of every eight stocks in the sector is down 90% over the last decade. Who would have thought ten years ago that in the early stages of an Energy revolution in the United States and one of the longest bull markets in stock market history that so many stocks in the Energy sector would lose nearly all of their market value. It wouldn’t be the stock market if it didn’t surprise as many people as possible! Click here to join Bespoke Premium with a special offer and gain access to our full 2020 Outlook report.
Fixed Income Weekly – 12/18/19
Searching for ways to better understand the fixed income space or looking for actionable ideas in this asset class? Bespoke’s Fixed Income Weekly provides an update on rates and credit every Wednesday. We start off with a fresh piece of analysis driven by what’s in the headlines or driving the market in a given week. We then provide charts of how US Treasury futures and rates are trading, before moving on to a summary of recent fixed income ETF performance, short-term interest rates including money market funds, and a trade idea. We summarize changes and recent developments for a variety of yield curves (UST, bund, Eurodollar, US breakeven inflation and Bespoke’s Global Yield Curve) before finishing with a review of recent UST yield curve changes, spread changes for major credit products and international bonds, and 1 year return profiles for a cross section of the fixed income world.
In this week’s report we discuss falling yields for emerging markets.
Our Fixed Income Weekly helps investors stay on top of fixed income markets and gain new perspective on the developments in interest rates. You can sign up for a Bespoke research trial below to see this week’s report and everything else Bespoke publishes free for the next two weeks!
Click here and start a 14-day free trial to Bespoke Institutional to see our newest Fixed Income Weekly now!
Chart of the Day: Average = Abnormal
S&P 1500 Best Stocks of the Decade
As the year and decade winds down, no recap would be complete without a discussion of the best-performing stocks of the decade. Since the S&P 1500 is up close to 200% in the last ten years, there have been a number of big winners. In the table below we list the 25 best-performing stocks that are currently in the S&P 1500 that were also around in their current forms ten years ago. Topping the list of biggest winners is a company most people have never heard of – Patrick Industries (PATK). Ten years ago, the stock was a microcap with a market cap of just $22.3 million, but during the last ten years, PATK’s stock has rallied more than 4,500%! So what cutting edge technology is PATK involved with? 5G? AI? The Cloud? No, no, and no. According to the company’s website, PATK is a major manufacturer and distributor of component and building products for the Recreational Vehicle, Manufactured Housing and Marine industries. There you have it. Not every big winner in the stock market has to be a tech company.
While you may have never heard of PATK, the next two stocks on the list are much more of household names. Netflix (NFLX) has rallied just under 4,000% in the last decade while Domino’s (DPZ) is up over 3,300%. Can you think of a better way to spend a cold winter afternoon than watching Netflix and dialing up some Domino’s? Besides these three names, other notable stocks on the list of biggest winners include Broadcom (AVGO), United Rentals (URI), Regeneron (REGN), Ulta Beauty (ULTA), and Amazon.com (AMZN). Although AMZN already had a market cap of $58 billion ten years ago, it has defied all growth expectations and still managed to rally more than 1,200% this decade.
When it comes to market cap, AMZN is clearly the exception more than the rule. So if you are looking to score one of the biggest winners in the next decade, you’re unlikely to find one among the FANG stocks or in the mega-cap S&P 100 for that matter. Besides the 25 names listed below, another 17 have rallied more than 1,000% over the last ten years. Of those 42 total names, only three had market caps above $10 billion (Amazon.com, NVIDIA, and Mastercard), and just 15 even had market caps above $1 billion. Overall, the average market cap of the 42 ten-baggers was $3.3 billion at the start of the decade, while the median market cap was just $565 million.
The fact that most of the biggest winners of the last ten years weren’t large caps to begin with certainly doesn’t mean that large-cap stocks are a bad investment. There are plenty of stocks that, even though they weren’t the best performers, still performed admirably over the last ten years. Additionally, while the last decade has been great for the stock market, in the event that the next decade isn’t as good, large-cap stocks are likely to collectively provide a lot more stability than their small and micro-cap peers. Click here to join Bespoke Premium with a special offer and gain access to our full 2020 Outlook report.
Bespoke’s Global Macro Dashboard — 12/18/19
Bespoke’s Global Macro Dashboard is a high-level summary of 22 major economies from around the world. For each country, we provide charts of local equity market prices, relative performance versus global equities, price to earnings ratios, dividend yields, economic growth, unemployment, retail sales and industrial production growth, inflation, money supply, spot FX performance versus the dollar, policy rate, and ten year local government bond yield interest rates. The report is intended as a tool for both reference and idea generation. It’s clients’ first stop for basic background info on how a given economy is performing, and what issues are driving the narrative for that economy. The dashboard helps you get up to speed on and keep track of the basics for the most important economies around the world, informing starting points for further research and risk management. It’s published weekly every Wednesday at the Bespoke Institutional membership level.
You can access our Global Macro Dashboard by starting a 14-day free trial to Bespoke Institutional now!
Bespoke’s Morning Lineup — 12/18/19 — The Drift Continues
See what’s driving market performance around the world in today’s Morning Lineup. Bespoke’s Morning Lineup is the best way to start your trading day. Read it now by starting a two-week free trial to Bespoke Premium. CLICK HERE to learn more and start your free trial.
The Closer – Greatwill, Strike Rebound, JOLTs Surge, Permits Perfect – 12/17/19
Log-in here if you’re a member with access to the Closer.
Looking for deeper insight on markets? In tonight’s Closer sent to Bespoke Institutional clients, we provide some insights into the goodwill of S&P 500 companies before turning to today’s very strong economic data including very positive housing results, industrial production, and job openings.
See today’s post-market Closer and everything else Bespoke publishes by starting a 14-day free trial to Bespoke Institutional today!