2014 is over and we now enter year 6 of a truly historic bull market, which has stemmed from the worst recession since the Great Depression. Record low interest rates have bolstered financial assets to extremely high valuations, while slowing Chinese growth and a dismal European economy has sent commodities prices spiraling downwards, pointing to potential deflation. Many market participants seem to have the blinders of short-termism impacting their decision making, as the consistent ascension of both stocks and bonds has been met with only mildly volatile spells, which have subsided harmlessly in most cases. History tells us, these conditions won’t last forever and it is those investors’ that focus on the areas of the market where values are still attractive that will ultimately succeed.
At T&T Capital Management (TTCM), we utilize a deep value-based investment approach similar to that used by the likes of Warren Buffett and Bruce Berkowitz. We perform extensive research and analysis to identify the intrinsic value of a business and we only buy them when we can acquire shares at a 40-50% discount to our appraisal. In addition, we employ strategies such as covered calls, cash-secured puts and distressed debt investing to generate higher income streams than are currently available to most traditional strategies. With 10-year Treasury bonds yielding around 2.2% and stocks trading in excess of 17.5 times TTM earnings, there is little margin for error for risk-averse investors. Sectors which have been market leaders, such as utilities, healthcare and technology, now seem quite rich and are likely to be leaders moving forward.
Join us on Thursday, Janaury 22nd 1:00pm Eastern Time for a webinar hosted by Chief Investment Officer Tim Travis, where he will outline where the opportunities are in today’s market and just as importantly, what areas to avoid moving forward!
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