Market Musings: Fund Flows & Historic Performance Data Is Bullish For 2020

Fund flows, for me, has acted as the biggest signal that there is a lot more upside ahead in equities. Looking at the chart below from Raymond James, it seems that equity fund flows have been persistent since 2015. This is a good sign for bulls. Euphoria is nowhere to be found, besides mini pockets in super small subsectors like crypto (late 2017) and pot stocks (early 2019).

               Source: Raymond James

Combine the outflows in equity funds with the historic data showing what happens in the year after a 20%+ return in the S&P 500? Hint: It's bullish.

        Source: Raymond James


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