NEW YORK (TheStreet) -- TheStreet's Joe Deaux and Pension Partners' Michael Gayed sat down Friday to discuss what retail investors can do to stay ahead of the economic curve.
In his father's book, "Intermarket Analysis and Investing," which Gayed is republishing, he believes investors need to consider multiple factors in their analysis such as how a move in bonds will affect the price of stocks.
Looking at the Japanese stock market, the Nikkei, Gayed pointed out the market continued to move higher along with interest rates before snapping back into the current harsh correction.
Gayed noted the similarities to the U.S. stock market crash in 1987, when the market also experienced rising equity prices along with rising interest rates.
At the time, U.S. Treasuries were yielding close to 10% and stocks finally corrected, hard. Gayed believes this could now be happening in the U.S. as it did in Japan. Gayed suggested retail investors diversify and learn about how asset classes affect one another.
He concluded, "You have to really understand the dynamics, especially in a world that is so globalized and where everything is so interconnected."
-- Written by Bret Kenwell in Petoskey, Mich.
Bret Kenwell currently writes, blogs and also contributes to Rocco Pendola's Weekly Options Newsletter. Focuses on short- to intermediate-term trading opportunities that can be exposed via options. He prefers to use debit trades on momentum setups and credit trades on support/resistance setups. He also focuses on building long-term wealth by searching for consistent, quality dividend paying companies and long-term growth companies. He considers himself the surfer, not the wave, in relation to the market and himself. He has no allegiance to either the bull side or the bear side.