This is the video recording of the May 12th Weekly Town Hall w/ Willie Delwiche.

05/12/22 2:00 PM ET

Technically, not everything can underperform.

There are always some groups of stocks that are doing better than the others. Whether that means going up in price faster, or going down in price slower.

In some cases, like more recently, some stocks do well on an absolute basis well others lose value altogether.

This year we've seen the largest dispersion of returns among US Sectors in over 20 years. The difference in returns between Energy and some of the Growth areas like Communications or Tech have been historic across the board.

Here's Energy relative to Technology, as well as Energy relative to the overall market, as defined by the S&P500:

Global markets have been in a mess for a while now. For some time there, India was displaying resilience when it came to the broader market indices. But that has changed over the past few days.

We have seen a selloff come through in the market and it is time to revisit the levels that could be crucial going forward.

From the desk of Willie Delwiche.

Volatility is on the rise and some of the reactions we’re seeing are entirely predictable.

For instance, I’ve seen multiple versions of this chart shared in recent weeks:

It claims to show how hard it is to effectively time the market. Advisors and strategists use this to scare investors with a seemingly straightforward message: If you miss just a handful of the best days in the market, your returns will suffer.

Good morning!

We're making an adjustment in the portfolio today.

It goes without saying the market's been carnage all week.

There's no shortage of noise out there.

So we want to keep it simple and share three key charts and the stories they're all conveying.

From the desk of Louis Sykes @haumicharts

This week has seen one of the largest blow-ups in crypto history.

I think the severity of the Luna collapse, in relative terms, can't be understated.

From trading at $100 a month ago to 2 cents today.

From being the 3rd largest coin in the asset class two weeks ago to currently testing support at zero.

From an 80% drawdown in a "stable" coin that's supposed to be pegged to $1 USD.

There's an incredible amount of wealth that's been lost in this blow-up.

There are a lot of charts that looks very similar to this one.

Tops are a process right?

This is what this one looks like:

Jan Barta of Pale Fire Capital revealed an additional purchase of roughly $23 million in Groupon $GRPN, as he continues to build a position.

The CEO and the president of OPKO Health $OPK revealed a purchase of approximately 400,000 shares of his company's stock in a Form 4 filing.

From the desk of Steven Strazza @Sstrazza and Ian Culley @Ianculley

Credit spreads are widening to their highest levels since late 2020.

If it feels like we just mentioned spreads and the falling HYG/IEI ratio, it’s because we did – and for good reason! They provide valuable insight into the overall health of the market.

High yield bonds $HYG rolling over faster than US Treasuries $IEI implies stress on credit markets and trouble for equities.

This is critical information.

We’ve been closely following the HYG/IEI ratio for months as it repeatedly tests the lower bounds of its range. It broke down to fresh lows in March, only to bounce higher with many risk assets.

Two months later, this crucial risk ratio is printing fresh 52-week lows again. The main difference is that the overall market environment has drastically changed since the last time we were at these levels.

Even the strongest stocks can’t catch a bid as investors...

From the desk of Steve Strazza @Sstrazza

Welcome to the 2 to 100 Club.

As many of you know, something we've been working on internally is using various bottom-up tools and scans to complement our top-down approach. It's really been working for us!

One way we're doing this is by identifying the strongest growth stocks as they climb the market-cap ladder from small- to mid- to large- and, ultimately, to mega-cap status (over $200B).

Once they graduate from small-cap to mid-cap status (over $2B), they come on our radar.

Likewise, when they surpass the roughly $30B mark, they roll off our list.

But the scan doesn't just end there.

We only want to look at the strongest growth industries in the market, as that is typically where these potential 50-baggers come from.

Some of the best performers in recent decades – stocks like Priceline, Amazon, Netflix, Salesforce, and myriad others – would have been on this list at some...

From the desk of Willie Delwiche.

Key Takeaway: The unwinding of a liquidity-fueled speculative bubble is weighing on investor sentiment, pushing many indicators into areas that signal excessive pessimism. The challenge in the current environment is the disconnect between how investors say they are feeling and what (if anything) they are doing about it. Popular sentiment surveys are so widely watched that they seem to be producing more noise than signal. This makes less widely followed surveys (like those from Consensus and NAAIM) more useful. ETFs overall have begun to experience outflows, but there is still plenty of evidence that investors are looking for ways to increase equity exposure.

Sentiment Report Chart of the Week:  Buying Weakness Isn’t Evidence Of Fear

Echoing the message from the AAII asset allocation survey is a Investor Movement Index from TD Ameritrade that shows investors were “net buyers of equities in April.” That’s an unlikely way to express the fear and pessimism that is evident elsewhere. A...