Market Strategist Jeff Saut on Investor Sentiment ~ market folly

Tuesday, June 5, 2012

Market Strategist Jeff Saut on Investor Sentiment

Given the volatility in markets as of late, we thought it'd be prudent to check in with market strategist Jeff Saut.  His latest missive, entitled "1-800-Get-Me-OUT?!" obviously hints at the prevailing investor sentiment at the moment: sell sell sell.

Saut examines the psychology behind why and when investors sell, which is definitely worth the read below in his commentary. 

But what's funny is how he points out that, "Since last October 4th's 'undercut low' the chant from most investors has been, 'We want a pullback to become more fully invested.'  Now that we have the pullback, everyone is in panic mode (again)."

In order for a rally from oversold levels to commence, Saut points to the 1290 level on the S&P 500.  If the market can recapture and stay above that level, things are looking up (it currently trades around 1281). 

However, if it fails, he argues it would be time to acquire more hedges or raise more cash.  We've also previously highlighted Saut's approach to risk management.

Embedded below is Jeff Saut's weekly market commentary:

You can download a .pdf copy here.

For more from the strategist, head to his thoughts on why it's time to dip into stocks.

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