On Thursday, in a call with clients as well as the media, the chief global strategist of the Asset Management of JP Morgan stated that a lot of blame for the market volatility which is prevalent recently basically falls with two types of investors.
He further stated that the fundamentals of economics looking from the jobs to the earnings all appear to be positive.
This has led him to place the responsibility of the series of sharp sell-offs that has occurred this month on two groups.
These two groups include passive as well as the momentum investors. These are those which buy as well as sell via algorithms along with systems of automatic trading.
Kelly also stated that one of the impressions that they have got over is that the market is being decided as well as determined on a daily basis by little Warren Buffetts which are millions in number and who usually do a lot of careful thinking regarding the value of the stocks.
He further added that it was never like that earlier and it is not like that even today.
Kelly also said that despite the slowing of the growth rates there isn’t any sign of the weakening of the economy which is thus a promising signal.
Further he pointed out to the reality that during the holiday season, most of the active managers as well as executives are on vacations are therefore the trading volume is very thin.
The chief global strategist of the asset management at JP Morgan also highlighted an opportunity for the investors that as the market are down by 15 percent since the beginning of the quarter, it is probably the right time to buy.
Source: Business Insider, Consultant Insider
