The Greatest Danger For Stock Investors Today [SPDR Gold Trust (ETF), SPDR S&P 500 ETF Trust, iShares MSCI Japan Index (ETF)] - Seeking Alpha

The Greatest Danger For Stock Investors Today [SPDR Gold Trust (ETF), SPDR S&P 500 ETF Trust, iShares MSCI Japan Index (ETF)] - Seeking Alpha



Eric Parnell has written another excellent article about 2014 stock market conditions and where stocks might be going next.  He compared four great asset classes to each other:  Stocks (SPY), Gold (GLD), Bonds (TLT), and Volatility (VXX).  The ETFs represented here are all up for 2014, and stocks are surprisingly lagging in spite of all the bullish conversation going on.  You could have made the most money on VXX or TVIX if you had bought at the lows around the first of the year and if you had taken profits somewhere near the highs.  I made 37% on TVIX from the end of January to the first part of February.  Unfortunately, volatility cannot be predicted, though.  I recently thought the Ukraine situation would turn into something really bad, but it did not.



The bottom line is that investors need to have allocations in different areas.  When I sold part of my position in TVIX back in February for a profit, I held onto some of my TVIX shares because I am expecting volatility to pop up at various times in 2014.  I am also long on many stocks like SPY, XLU, DVY, PSEC, RSO, and NYMT.  It will be difficult to know where the top of the stock market will occur.  We just have to be ready for any situation.  Profits should also be taken at various times.