Stocks are now on borrowed time.
Corporate buybacks have been the single largest driver of stock prices in the last quarter. Institutional investors have been net sellers for 15 weeks. And individual investors have been pulling capital out of stock funds in record amounts.
This leaves corporate buybacks as the sole driver of stocks. But now that is ending.
Announced buybacks plunged 34% in 1Q16. This is the single largest plunge in announcements since 2009.
Now, this does not mean buybacks are drying up all at once. As you can see in the chart above, there were a record number of buybacks announced in 2015. Those plans are beginning to be implemented.
———————————————————————-
The Single Best Options Trading Service on the Planet
THE CRISIS TRADER has produced an astounding 172% return on invested capital thus far in 2016.
We have a success rate of 72% meaning we make money on more than seven out of 10 trades. And thanks to careful risk management we’ve seen triple digit returns on invested capital every year since inception.
Our next trade goes out this morning… you can get it and THREE others for just 99 cents.
To take out a $0.99, 30-day trial subscription to THE CRISIS TRADER...
———————————————————————–
So there will be a significant degree of corporate buybacks going forward.
However, buyback announcements and actual purchases are not the same thing. Many times companies announce buyback programs that they later fail to complete. So the buying power here is much less than most realize.
Meanwhile, earnings are collapsing, while stocks remain near all-time highs.
Either earnings need to erupt higher in the next few months (highly unlikely given lack of growth) or stocks need to drop at a minimum 20%.
We’re currently preparing for a similar situation today.
Indeed, subscribers of my Private Wealth Advisory newsletter just closed out THREE more winners last week: gains of 10%, 12% and 15% produced in just a few weeks’ time.
This brings our winning trade streak to 81 straight winning trades.
Indeed, we haven’t closed a single loser since November 2014.
81 straight winners… and not one closed loser… in 18 months.
However, I cannot maintain this kind of track record with thousands of investors following our recommendations.
So we are going to be raising the price on a Private Wealth Advisory subscription from $199 to $249 at the end of the month.
However, you can try Private Wealth Advisory for 30 days today, for just 98 cents.
If you find that Private Wealth Advisory is not for you, just drop us a line and you won’t be charged another cent.
To take out a 30 day trial to Private Wealth Advisory for just 98 cents…
Best Regards
Graham Summers
Chief Market Strategist
Phoenix Capital Research
Our FREE e-letter: http://gainspainscapital.com/
Follow us on Twitter: http://twitter.com/GainsPainsCapit
