Three Key Trades for 2016

In many ways, 2015 was the year of the return of volatility. While stocks largely traded sideways, the August/September shakeout is likely a sign of things to come in 2016.

If we expand our horizon across asset classes and the globe, there was significantly higher volatility and more downtrending price action. Thus, my main theme for 2016 for stocks is the year of volatility.

As it relates to the economic picture, 2015 marked the seventh year in a cyclical bull market (likely within a new secular bull market), making it long in the tooth historically speaking.

I think 2016 is likely to bring a 20% to 30% correction in the broader stock market at some point, but make up a good deal of those losses by year end.

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