here was no parallel in history! It was the best month in the world for risky assets

category:Finance
 here was no parallel in history! It was the best month in the world for risky assets


Also in this month, after nearly a year of holding back in the epidemic situation, the good news about the new crown vaccine has been repeatedly bombarded. The data of phase III clinical trial of new crown vaccine of many pharmaceutical companies is better than expected. Two companies have applied for emergency use right, which brings hope for economic recovery.

In addition, the dust of the U.S. election has settled, and uncertainty has also contributed to the global risk market.

At present, the fear & green index, which reflects market sentiment, has pointed the greed indicated in the graph to extreme greed.

Of course, if you tell people in March that there may be no jobs in the coming year, restaurants and entertainment venues will not be open, but the index may reach a new high, and people will think you are paranoid, but these conditions do happen at present.

Stock index soaring

U.S. stocks performed well in November, with the Dow up 11.8%, the biggest gain in 33 years, and the NASDAQ and the S & P 500 also rose more than 10%, the best month performance since April this year. The size of ETF funds also increased by $77 billion, a record.

From the valuation point of view, the S & P 500 indexs market rate reached an all-time high.

In addition, European stocks also had their best November performance ever.

Carnival of small cap stocks

Among them, the Russell 2000 index, which represents small cap stocks in the United States, rose 18% in November, its best performance since records began. Small cap focused ETFs increased by $8 billion in November, the highest level in 2016.

In addition, US small cap stocks have outperformed large technology stocks for three months in a row, reaching the biggest three-month performance since 2002.

The rise of cyclical stocks

While big tech stocks have enjoyed a good rally, U.S. cyclical stocks have continued to soar.

In November, the bundleof energy index, which represents U.S. energy stocks, surged by more than 25%, the biggest month since April, while the industrial and financial sectors of the US stock market also saw their highest gains since April.

New high in value stocks

In addition to the rise of U.S. cyclical stocks, value stocks continued to rise in November. As the good news of the vaccine raised expectations for recovery, people began to shift their targets from growth stocks to cyclical stocks.

In November, the Russell 1000 value index, which represents the value stocks of US stocks, rose 13%, the best performance in history. At the same time, growth stocks were up 10%, with a gap of only 3%, the smallest monthly record in 20 years. At the same time, the growth of ETFs in November was the highest since 2013.

The US energy sector was the best performing sector in November, surging 31% (slightly higher than Aprils increase), the biggest monthly performance ever.

Matt forester, head of investment at Lockwood, a bank of New York Mellon, said if the economic recovery takes hold, more and more money will flow into value stocks, which are currently undervalued relative to growth stocks.

During the month, Facebook, Amazon, apple, Microsoft and Google grew by a weighted average of 5.9%, less than a fraction of the Russell 2000 index.

Bitcoin boom

In addition, bitcoin has nearly tripled in 2020 for the whole year, up 97% since early September.

Panic index down

Gold price falls

Under the continuous influence of risk preference, the demand for gold continued to decline, driving the price of gold to fall below $1800 / oz, the largest drop since 2016.