(1888PressRelease)
October 30, 2008 - Los Angeles based boutique wealth management firm, Martin Asset Management, LLC is calling the bottom and suggesting to allocate towards equities during the next pullback.
"Bad news have been already factored in, that was especially evident during today's session when US consumer confidence plunged to a record low in October as consumers felt the bite of the credit crisis sounding alarms over the year-end holiday shopping season. The Conference Board, a business research firm, said its consumer confidence index plummeted to 38.0, its lowest reading since the index was launched in 1967, down from 61.4 in September. Nevertheless, the Dow gained more than 11% which indicates that this extreme reading was factored in. There is no doubt, we will retest the lows sometime during the fourth quarter earnings season but we believe most of the bad news stemming from a very weak 4th quarter is already figured in. We are waiting for the next pullback to get our equity exposure up to 50% to 65%. This is truly a once in a lifetime opportunity to do very well, especially if you have a long term perspective of at least five years", Francisco Martin says.
Francisco Martin, Founder and Chief Investment Officer of Martin Asset Management is no stranger in the game of calling extreme bottoms. He called the exaggerated sell-off after the 9/11 attacks (see Los Angeles Business Journal of September 24, 2001 with the title "Fundamentals, Not Events, Determine Final Stock Fate. stock market will rebound following terrorist attacks").
"Calling bottoms is probably one the most controversial things a money manager can do since most will wait and call it when the market is already up by 15% to 20%. We like to at least participate 50% in that early stage recovery. To clarify things, nobody can with 100% certainty call a bottom but one can get clear signals (fundamentally as well as technically) from the markets if such a bottom is close and we believe we are very close to one," Martin says.
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