October 25, 2013 at 16:58 PM EDT
Are Trader Margin Levels A Sign Of A Stock Market Bubble?
INDEXDJX:.DJI, INDEXSP:.INX, NYSEARCA:SPY, NYSEARCA:DIA, DJI:DJI, CBOE:SPX, NQ:COMP, NY:XAX Related posts: S&P 500: Spike In Margin Debt Could Signal A Stock Market Crash Ahead S&P 500 Crash Warning: Margin Debt Surpasses 2007 Danger Levels Stock Market Margin Debt At All Time High S&P 500: The Final Euphoric Parabolic Phase Of A Stock Market Bubble Stock Market Bubble vs. Impressive Bullish Breakout

stock-bubbleETF Base:  Are we looking at a stock market bubble here? Take a look at this chart and consider.

On one hand, I was astounded by the almost perfect correlation between investor margin levels and actual S&P500 Index (INDEXSP:.INX) valuations. It should be a pretty good fit I suppose, assuming people use margin to go long, but I wouldn’t have thought the fit is that tight. Anyway, from an overall market valuation standpoint, it’s easy to see how one could call this market frothy, but at the same time, the same argument could have been made months or years ago and you would have missed some major upside.

Other Market Bubble Signs?

  • Twitter IPO – Need I say More?
  • Bull Market Without Any Corrections – Up 22% this year and running, the market has yet to undergo any serious corrections in years.
  • People are actually talking about the market again.  This is never a good sign.

The hard reality for traders and investors alike is you need to be in it to win it. Nobody can predict the up days and down days and unfortunately, just a few major up days per year end up comprising a good portion of the total returns in a given year.

This article is brought to you courtesy of JT from ETF Base.

You are viewing an abbreviated republication of ETF Daily News content. You can find full ETF Daily News articles on (www.etfdailynews.com)

Related posts:

  1. S&P 500: Spike In Margin Debt Could Signal A Stock Market Crash Ahead
  2. S&P 500 Crash Warning: Margin Debt Surpasses 2007 Danger Levels
  3. Stock Market Margin Debt At All Time High
  4. S&P 500: The Final Euphoric Parabolic Phase Of A Stock Market Bubble
  5. Stock Market Bubble vs. Impressive Bullish Breakout

Stock Market XML and JSON Data API provided by FinancialContent Services, Inc.
Nasdaq quotes delayed at least 15 minutes, all others at least 20 minutes.
Markets are closed on certain holidays. Stock Market Holiday List
By accessing this page, you agree to the following
Privacy Policy and Terms and Conditions.
Press Release Service provided by PRConnect.
Stock quotes supplied by Six Financial
Postage Rates Bots go here