On the fifth of February 2018 the Dow Jones Industrial Average saw its largest single day drop in history. This drop coming off a market sell-off at the end of January has caused many investors to call for the start of a bear market. Are these claims well founded, or just good headlines?
Firstly, dollar amounts are likely the worst way to look at market changes as they skew the data. In 1929 the Dow fell from around 300 to 230. A 70 point move means nothing in today’s market environment.…
It would make sense if a company’s share price increased roughly in time with earnings and profits. It’s simple, logical, and based purely on the core fundamentals of the company. This logic even worked between 1995 and 2012 as shown below.
Most everything moved in line with the overall performance of the screen. They may have larger movements in either direction, but the general shape matches up pretty well.
So what does it look like after 2012?
There is no rhyme to this rhythm. There is honestly no way to explain this sort of behavior from simply looking at the fundamentals of the company.…
As people become more jumpy when it comes to the market, I decided to take it upon myself to build a screen that we could use in order to protect ourselves in the event that we do enter another recessionary period. Now, I want it to be known that I don’t necessarily believe that another recession is imminent; rather, I just like being prepared for any situation.
Sadly, there are only two recessions over the past 20 years, so we don’t have a ton of data to work with which results in a lot of guesswork and relying on fundamental factors to find companies that are secure rather than trading via speculation.…
In the words of Yahoo Finance, CHD “develops, manufactures, and markets household, personal care, and specialty products in the United States.”
Church & Dwight Co is an interesting company to analyze for a few reasons: