US stock markets have continued
their ascent, reaching new highs on four consecutive trading sessions. The
S&P looks poised to challenge the 1,900 level, almost 3x the level it
reached at the height of the financial crisis in early 2009. It now ranks
as one of the top 6 bull markets in history in terms of length as well as duration. Despite this amazing rally, it has a long way to go before
matching the strongest bull market in history. That honour goes to the
bull market that started after the market crash in 1987 and ended with the
burst of the dot-com bubble, a market that returned a whopping 582% and lasted
over 12 years!
With the mixed bag of economic
data we have been seeing combined with escalating geopolitical tensions, one
has to wonder how much more room this market has to run. It might not be
time to go to the sidelines necessarily, but being in a well-diversified
portfolio of blue chip names could partially shelter you from some of the
larger losses that could be incurred if the market does happen to pull
back. We continue to prefer writing calls on our equity holdings as
opposed to an outright buy and hold strategy at this point.
