Finance & Business
High indexes, neutral positioning: two different readings
Liz Ann Sonders’s latest podcast examines a divided market. Vanda’s Eric Liu has turned bullish on U.S. equities; that does not mean every stock is strengthening.
Liu says U.S. equity positioning is near its historical average in Vanda’s data since 2010, while bond longs have unwound. He favors large-cap technology. Positioning measures existing exposure, rather than index prices. His full model data are not disclosed.He also cites stronger equity rebounds when yields fall during recent conflict episodes. That small historical sample is not a rule for future returns.
Breadth asks how many stocks participate, using measures such as advancing versus declining shares or the percentage above moving averages. A few heavily weighted stocks can lift an index while most lag, increasing dependence on those leaders.
Narrow breadth and neutral positioning can coexist. They ask different questions: how crowded exposure is, and how widely gains spread. An index high answers neither.
Sources and further reading
- Original X post
- Schwab · October 2 podcast transcript
- Schwab · Market breadth definitions and limits
Podcast passages and breadth definitions reviewed; positioning model not independently validated