The Monday Morning Twitch—Europe Surges while the VIX Whispers Secrets
Written by: Cosmo from The Smartin Team
THE AIR! It’s thick, people! You smell that? That’s the scent of a 1.37% JUMP in the Euro Stoxx 50 while we were SLEEPING! The continent is awake, they’ve had their espresso, and they are BUYING! But here? In the states? We’re looking at a VIX that crept up to 14.85. It’s a twitch! A low-level hum in the floorboards!
THE GREAT DIVERGENCE OF THE DINER
Last week was a MADHOUSE. A total split personality! The QQQ was up 1.73%—tech is flying, it’s soaring, it’s touching the satellites! But look at the DIA—down 1.41%! The blue chips are sinking into the swamp while the chips—the silicon ones—are throwing a party. AMD was up 13.5%! INTC up 11.7%!
My guy Lomez says the satellites are aligning, but I look at the numbers. You have to KNOW WHAT YOU OWN! If you’re chasing a 15.1% gain in MARA like a dog chasing a mail truck, you better check the plumbing! Peter Lynch doesn’t care about the hype—he cares about the LEAKY PIPES. If the debt-to-equity ratio looks like a phone number, YOU ARE IN TROUBLE!
STOP STARING AT THE TAPE AND SMELL THE PEG
Everyone is obsessed with the “vibe.” The vibe is for patio furniture! For your portfolio, you need a fundamental stock screener app that doesn’t lie to you! I see people buying WING even though it dropped 9.3% last week. Why? Because they like the sauce? Lynch says “buy what you know,” but he didn’t say “buy it at a P/E of a hundred because the ranch dressing is zingy!”
The PEG ratio! It’s the only thing keeping us from total ANARCHY! If the growth doesn’t match the price, you’re just buying a very expensive balloon that’s waiting for a needle. And the VIX is currently a very small, very sharp needle at 14.85.
THE LOMEZ PROTOCOL
You can’t just trust the “system.” The system is rigged for the guys in the shiny shoes! You need to be the detective! Last week, NFLX shed 10.6%—was it the content? The subscribers? Or was it just the gravity of a bloated valuation finally catching up?
Listen to me: the Euro surge of 1.37% is a signal, but the DIA’s 1.41% drop is the WARNING. We’re living in a bifurcated reality! One half of the market is at the disco, the other half is at a funeral! You need to know which room you’re walking into before you take off your coat!
Check the Latest Fintainment Roasts to see who else is wearing a tuxedo to a graveyard, and read The Hitchhiker’s Guide to Peter Lynch Investing before you let a “vibe” pick your stocks.
Bob says the moon is in the house of Jupiter, but I say the PEG ratio is in the house of “pay attention or lose your shirt!”
Before you let Lomez pick your next ticker, run it through this for a 15-second reality check!