Flip Flop
The market has been flip-flopping for a while now, and while most seem not to notice, I am really getting tired of it. If one pays attention only to the S&P 500 index, then it may not seem like there is any inconsistency as it just keeps going up each quarter, or at least it has over the last couple of years. However, it is what happens under the surface that really tells an investor what is happening.
In the first quarter of 2024, everything worked: Large growth had an 11.4 percent gain, but large value returned 9 percent, and small companies were up nicely as well. We had a broad-based market rally. Then the market flipped: In the second quarter of 2024, large growth was up 8.3 percent, and every other category actually lost money. Then, the market flopped: In the third quarter of 2024, small value stocks were the best place to be, up 10.2 percent, while small growth stocks were up 8.4 percent and large value stocks were up 9.4 percent. Large growth stocks were still positive, up 3.2 percent.
This trend lasted through November, but in December, the market didn’t just flip; it flipped out: The entire market dropped 7 to 8 percent, except for large growth, which was up just under a percent.
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