Top advice from top U.S. investors
Many newcomers to the market dismiss the option of buying index funds. But, as statistics show, they are wrong. The S and P 500 chart live contains both high-priced and low-priced stocks. Because of this, the index better reflects the U.S. stock market, so it is even called a barometer of the U.S. economy.
The index consists of 11 sectors, with IT being the largest sector at 27.8% (as of July 30). The IT sector is far ahead of second and third place health care (13.4%) and consumer staples (12.1%). The top 10 companies account for 27.6% — mostly tech giants, among them: Apple, Microsoft, Amazon, Facebook, Alphabet (Class A and C), Tesla, Berkshire Hathaway, Nvidia, and JP Morgan.
Chart SP500 historical: analyst estimates
BTIG
Experts at investment firm BTIG point out that an “epic emotional” rally would begin if the S&P 500 index reaches 4,500 points. It could lead the market up 5% or more over the next week or two.
Moody’s and Morgan Stanley
However, not all investment houses are so optimistic. Moody’s and Morgan Stanley warned investors of the risks of a 15-20% correction in the S and P 500 chart live. As triggers, analysts cited a possible tightening of monetary policy from the Fed and inflated multiples on stocks.
Ray Dalio
Ray Dalio recommends the following asset allocation:
40% — long-term bonds (maturity of ten years or more);
30% — stocks;
15% — medium-term bonds (5-10 years);
7.5% — gold;
7.5% — commodities.
Peter Mulluk
Peter Mullan, president of Creative Planning Investment Fund: “With these 500 stocks, you will own about 80% of the market capitalization of the entire U.S. market. In addition, you will have a global presence because these companies get most of their revenues overseas: McDonald’s has stores in China and Walmart has stores in Europe. So you get an inexpensive diversified portfolio of investments in the global economy. \\
A “golden cross” has formed on the chart of the S&P 500. What does this mean for the market?
A “golden cross” indicator occurs when the short-term moving average of an asset crosses and exceeds the long-term moving average. This is usually considered a signal for further market growth.
The S&P 500 index rose more than 3% last week, peaking at 4,195.44 points. The U.S. Federal Reserve’s decision to raise its key rate by 25 basis points to 4.5-4.75% per year, as well as a slowdown in inflation sparked the surge in the U.S. stock market. The Consumer Price Index (CPI) fell from 7.1% to 6.5% year-over-year in December 2022.
The rally in the stock market led to the emergence of a rare technical analysis pattern called the golden cross.. This figure usually appears late in a recession or during signs of economic recovery, Bank of America experts noted.
“Golden Cross” is a graphical pattern that represents the intersection of short-term and long-term moving averages from bottom to top. Typically, the indicator uses the 50-day moving average as the short-term average and the 200-day moving average as the long-term average.
Ryan Dettrick, chief market strategist at Carson Group consulting company, pointed out that the S&P 500 index rose in the next 12 months 15 out of 16 times when the indicator charted a “golden cross. The average annual return on that rise was 15.7%, the average six-month return was 9.8%; the average three-month return was 6.7% and 1.9% for the month.
