Fox Business
Expand
Browse All Video
Watch Live

You're watching...

Low Vix a Concern for Investors?

Details

  • Description

    Bespoke Investment co-founder Paul Hickey on the outlook for the markets.

  • Duration 5:30
  • Date

Clips

Also in this playlist...

Latest Video

Auto-advance: ON

Auto-advance
View All

Transcript

This transcript is automatically generated

-- Well these so called fear index you've heard all the time we -- we -- a -- it is the next.

Kind of peddling along in a low peer range so how can we put this type of complacency -- lack of volatility.

On our side as investors somebody that we talked to all the power like Paul Hickey -- -- investment co-founder he joins me on the Fox Business explicitly -- Connecticut yes I was just talking to -- -- -- but the fact that it's just so quiet right now.

And a perfect example about Paul is the vex are we too comfortable right now too complacent.

Yeah hi Sheryl.

Did Divx below -- of the -- in and of itself doesn't necessarily such a bad thing we can get that in a minute but.

What we saw the start out the year.

Is of record weekly decline in the -- dropped 37%.

Which we'd gone back to 1990 we've never seen.

We have seen 30% weekly declines -- but what we.

Consistently see in the market following these sharp sudden drops in the -- Is below average short term returns that over the -- next week.

Month end and may even -- to three months you you tend to see below average market returns -- an average returns that are negative so.

When you suddenly see everybody.

Real quickly decide -- everything's good there's no need to worry that's time when you may wanna start worrying as a -- as a trader also.

As if you're looking at there -- looking at the chart of the -- again you can see it since that's the Washington volatile -- spike thank you very much which you know -- effective -- of course.

Everyone still -- at the same time.

On the side of the -- no I'm curious about you know if you look at how the ball -- of the mix if you will you really wanna track and -- chart I would -- -- talking to you.

If you look at that chart.

Does -- tell you something -- does it do you interpret what you seen in the last six months three must live next.

As something is on its way whether it's a major correction or it -- be the other side Paul they could be ready for huge bomb.

And all that cash that's been on the sidelines meet flood the market what do you say well you know -- I think.

May be your second point may be sort of what is more likely.

You know in the -- started getting low last fall -- -- started worrying because the last two times it had gotten below fifteen.

We saw an immediate pullback in the market but.

We if you think those during the you know the aftermath of the credit crisis things you know a lot of uncertainty but.

If you look back it historically you know in the early 1990s we had a multi year stretch where.

80% of they -- days the market close Divx close below fifteen offered you know three year period in the S&P 500 was up 50% over that period.

You saw another period earlier departed in earlier in the last decade.

Where we again we saw it close to 80% of all days the vick's close below fifteen.

And the SP is up almost 30% over that period so.

The fact that the low -- -- it just.

In and of itself isn't necessarily such a bad thing it's when you see.

A spike up which it tends to be accompanied by a correction or -- spike down when you wanna look at.

You wanted it -- deal little bit concerned over the short term but for a long in mustered a short term trader here we don't see much be worried about with the -- that.

Well when you see that 2007 levels anyway I'll remember how happy at that happy -- -- back in 2007 and then came 2008.

Let me ask you this about different sectors they are watching again this is from a chart perspective especially but -- -- certain sectors they are watching that you think at this point here.

-- overextended we've gotten too far.

Out of ourselves.

-- -- right now you know the health care sector is one of the most overbought sectors.

The material sectors overbought.

Even the financials they had they've had a strong run to start the year.

You know there's a lot of you know optimism and you know some of the rules regarding that Dodd-Frank and they're not be as restrictive as.

As originally thought to their summer her relief rally there now -- -- into earnings the -- Wells Fargo are released last weekend it you know.

Expectations were so high leading up to the east you tend to see a lackluster response market we could see that with the big banks on its earnings season.

-- so you could see a pullback in the short term help but you know we're using the get pullbacks as buying opera.

Our health -- -- like you wanna go back to a company that they know they're watching right -- -- Boston scientific and this is one of the companies that has had a nice run up.

Over the last your -- about 15% year over year.

The same time back in 2006.

You had investors running from this name.

Because -- in bad acquisitions that they made are you thinking that this company particulars back in favor.

Yet and we do think -- it's gonna be back in favor with investors out.

What they do is a big part of their business is implantable.

Pacemakers and defibrillators yeah.

And out of Boston Scientific -- purchased a company called Cameron health last year.

Which makes.

A new patented.

Defibrillator technology the big problem with these implanted devices.

Is there leads which can be.

Prone to failure in extracting the leads friends go into the heart can be a costly and risky procedure.

This company has a patented technology where they don't go into the heart it's all done outside the heart which.

It would be a lot less costly and it they just recently received.

-- approval from the FDA -- the process so we think it could really propel earnings here for the company and put the stock back into favor.

Paul Hickey of bespoke investment co-founder somebody I've been here on Twitter -- -- to my viewers follow -- thank you very much sense because the nugget currently.

Load More