5 votes

JPMC's Guide to the Markets - 1Q 2022

4 comments

  1. HotPants
    Link
    Slides of Note 6: Suggests markets will return next to nothing over the next five years (most economists expect low returns) 17: Suggests that once the 10 yr treasury yields more than 3.5%,...

    Slides of Note

    6: Suggests markets will return next to nothing over the next five years (most economists expect low returns)

    17: Suggests that once the 10 yr treasury yields more than 3.5%, markets will significantly alter (it's a very limited dataset)

    31: Shows where fed funds are heading (up)

    2 votes
  2. [3]
    HotPants
    Link
    Slide 62 is stunning. It shows in 2021 there was a significant change in investor flows. Those earning less than $20k have investment flows six times higher than those earning $125k, even though...

    Slide 62 is stunning. It shows in 2021 there was a significant change in investor flows.

    Those earning less than $20k have investment flows six times higher than those earning $125k, even though they earn a sixth of the income.

    This aligns with the speculative frenzy in GameStop, Dogecoin, Ethereum, and other meme investments.

    There have been recent posts from newer investors showing their entire portfolio is down for the year, when the overall market went up, because they invested in some of the meme stocks that recently corrected.

    In general, the newer investors fail to understand that certain investments can get overhyped, and if you ignore price to cashflow ratios, future expected cashflows, and more recently the risks to the discount rate, you are likely to get burnt.

    2 votes
    1. [2]
      skybrian
      Link Parent
      I think you might be misreading the slide? That's "indexed to February 18, 2020", which means that those earning less than $20k are investing a lot more money than they did a couple years ago, but...

      I think you might be misreading the slide? That's "indexed to February 18, 2020", which means that those earning less than $20k are investing a lot more money than they did a couple years ago, but that's comparing them to themselves (probably a low base), not doing a direct comparing between people with different incomes.

      It tells us that $125k and above didn't change behavior much, but they probably started out investing a lot more.

      4 votes
      1. HotPants
        Link Parent
        You are right. Which makes way more sense. The stimulus checks would have had negligible effect on the investment habits on anyone earning $125k+.

        You are right.

        Which makes way more sense.

        The stimulus checks would have had negligible effect on the investment habits on anyone earning $125k+.

        3 votes