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Volatility Index a Sign of a Market Pullback?

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  • Description

    Palisade Capital Management CIO Dan Veru on the outlook for the markets.

  • Duration 3:13
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If you look at the markets.

Year over here -- -- up double digit percentages but guess what has fallen double digit percentages by a massive 58%.

The volatility index we talk about this all the time.

But it has fallen nearly 60% over the past 52 weeks and hovered around a level of about fifteen.

If you want to talk historical precedent the past five times its billionaire and we pulled us up we made this chart for you.

The markets IE DS and 500 had gotten ugly really fast so are we set for another pullback.

Dan Murray chief investment officer at palisades capital management is spending in the last hour of trading with us in a Fox Business exclusive illicit fool me once shame on you fool me twice shame on me.

This is five times we know exactly what five times yes so -- sixth time do you expect that to happen or will we buck historical precedent.

Well this time it it is different because I think most alligators like hedge funds are set up the wrong way they're -- mainly under performing because they've been short this market.

They're looking at exactly the same charts -- -- looking -- I think the key difference this time is Europe I mean I think Germany and France have had plenty of time.

To reverse course on.

-- these original comments about a unified Europe.

And I think that's that's a significant difference and could set up for this.

Dragging kicking and screaming type of rally mean everybody is so mad about this rally because it hasn't played out the way most people have set up.

-- -- today when you say set up have not participated -- it because they were so scared and everybody thought wind going to be Smart I'm going to prepare I'm not going to be in equities and sure enough.

Equities have jumped as I said anywhere from 18% to 25% here for years so I you look at that you say wait a minute.

All you have to see is the trend and that is the massive outflows a -- from stock and equity funds it's redundant I know and into bond fund.

It's right we -- -- -- -- our mutual friend Jason trenor he points out since.

Over since 06 you've had.

Over 500 billion dollars of net outflows out of equity funds but more importantly you've had more than one point one trillion dollars go into bond funds.

So that differential that's like a spring that's going to resolve itself -- -- the spring very very far.

And could there be a correction here.

Clearly there could be and -- Divx is telling us that there's there's a pause here but I just can't see that there's a big drop off in equities -- more put out a note saying they -- they were gonna.

That you we would see as much as a 25% correction in the S&P I just don't see that happening.

Well that that would be quite the snapped back yeah definitely but.

You have come here time and time again and said -- like stocks I'm picking certain stocks for example we should tell people the last time the -- was here back on June 1.

You could -- drill it's been one of your favorites since then it's up about 28%.

Right not including the dividend which is very tasty about 9% right.

So again you know we paid a lot of money taking the other side the other view the opposing view because when consensus relies too much on one side you have to go the other way what is dance next -- -- I know I'm -- to know and you're going to find out in just a.

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