Posts tagged 'BCA Research'

Bringing your A game

The chart to the right is the China A-share index in US$ terms, from BCA Research. (Why the presentation in a different currency to that it trades in, we’re not sure).

The aspect to appreciate, for those who only started paying attention to China’s recent stock market mania, is A-shares have behaved like rockets before, in 2007.

There was a lot to pay attention to in 2008, but the A-share crash was a severe one, a drop of 70 per cent. Lest you think this is some sort of warning, BCA point out valuations were much crazier eight years ago. In their words “the red-hot bull market has further to go.” Read more

Temporisation watch

That uneasy feeling when everything is going well. Is it deserved? Can it last? Should you cash in and go paint watercolours in that studio on the Pembrokeshire coast?

Strategists are not immune, with a summer bout of the temporaries upon us. Goldman is the latest, downgrading its view of stocks over the weekend but without really committing to it:

We also downgrade equities to neutral over 3 months. We are concerned that a sell-off in government bonds will lead to a temporary sell-off in equities in line with what we saw last summer, though the magnitude is likely to be smaller as the need for bond yields to correct is lower than it was back then.

 Read more

A small and significant problem

A small squall or a broad based pall? BCA Research have spotted that small capitalisation stocks have been under pressure all around the world, in the US, Europe, Japan Asia and even, say they, the UK.

The reason, BCA suggests, is wage costs. Read more

Five ways with valuation

A quiet reformation continues.

One of the central articles of investing religion — that a forward price earnings ratio is a useful indicator of stock market value — is under sustained intellectual assault. Read more