Top Market Timers Still Bullish

Top market timers staying strong on stocks

The market-timing newsletters with the best long-term records remain as bullish today as they were following the sharp market break on Feb. 27.

he five are listed in alphabetical order, along with a brief summary of their current market timing opinions:

* Bob Brinker's Marketimer. Editor Brinker continues to be bullish on the U.S. stock market, as he has been continuously since March 2003. His most recent issue was published in early April, when the stock market had recovered some but not all of its late February/late March correction. In that issue, Brinker wrote that the "potential exists for the S&P 500 index (SPX : SPX1,494.07, -0.18, 0.0% ) to challenge its previous record high of 1527.46, which was recorded on March 24, 2000." As of Thursday night, when this column was written, the S&P 500 was 2.2% away from a new all-time high.
* Blue Chip Investor. Editor Stephen Check continues to believe the stock market is undervalued, based on his model that relates stocks' earnings yield to corporate bonds. The Hulbert Financial Digest calculates that his newsletter's model portfolio currently is 90% invested, vs. an 87% allocation at the end of February.
* The Chartist/Chartist Mutual Fund Letter. Two of the five newsletters with the best long-term market-timing records are edited by the same adviser: Dan Sullivan. He continues to advise a 100% invested position. In the issue of The Chartist published Thursday night, Sullivan writes: "Compared to the final stages of the previous bull market, which took place during the first quarter of 2000, this bull market is actually quite subdued, which is a good indication that it could stretch out for several more months despite the fact that from a time standpoint it is mature. The public has yet to embrace this bull market, and in essence, there is ample cash on the sidelines. The amount of cash from recent buyouts alone comes to a staggering $185 billion. On top of this, the recent buyout frenzy has reduced the supply of stock for sale."
* The Timer Digest. Editor Jim Schmidt bases this newsletter's market-timing model on a consensus of the newsletters he calculates to be the top market timers. His consensus of the top 10 based on performance over the past 52 weeks is bullish, with eight bulls and two bears; this represents a slight diminution in bullishness since late February, when this indicator stood at nine bulls and one bear. Schmidt's consensus of the top 10 for performance over the past two years is also bullish, with nine bulls and one bear; this represents a slight increase in bullishness since late February, when this indicator stood at eight bulls and two bears.

The bottom line: None of the top five newsletters for market timing performance over the last decade is any less bullish today than two months ago.