Are late-day ETF buy/rebalancing programs and the proliferation of price momentum (quant) strategies the 2017 equivalent of 1987’s portfolio insurance?
And does it end badly?
Yes, it probably does!
“I have learned through four decades of experience that once most market participants are conditioned to one way of action, the other way quickly may surprise them as rising markets brings rising expectations, and vice versa.
Those expectations can be argued to be at their highest level at any time in this bull market that started in the first week of March 2009.
Optimism in and of itself is not…

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