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Preparing for the project management professional (PMP) test can be daunting. With a wealth of PMP prep resources available across the internet, you might feel overwhelmed, uncertain or confused about which resources are the best.
Creating an effective personal study plan with goals and deadlines and using the best test prep resources will help to ensure your PMP certification success.
In this article, we share some strategies and PMP test prep resources to help you prepare to take the test. Options vary from short practice questions to PMP prep courses. Let’s dig in.
Prepping for Your PMP Exam
With the PMP test costing up to $555 per attempt, intentional preparation is critical for saving money, time and energy. The Project Management Institute (PMI) administers the PMP exam. PMI states that successful test-takers spend 35 hours or more on test prep.
The following considerations can help you pass the PMP exam on the first try.
Obtain Minimum Contact Hours
PMP candidates must complete at least 35 contact hours of formal project management education before they can take the certification exam.
You can build these contact hours through the following avenues:
PMI-authorized training partners
Training companies or consultants (e.g., training schools)
Distance-learning companies, including an end-of-course assessment
University/college academic and continuing education programs
Create a Reasonable Test Timeline
Once you complete your contact hours, it’s time to set a test-taking timeline.
The American Psychological Association suggests stretching your study time over a more extended period to help you better retain information. For example, if you aim to complete 35 total hours of studying, it is better to study for three to four hours per week for nine to 11 weeks rather than 12 hours per week over three weeks.
Last-minute cram sessions can be helpful for short-term information retention, but spacing out your study sessions results in better recollection.
After you determine how long your preparation should take, schedule out study time and practice questions leading up to test day.
Take Practice Exams
Practice exams are a great way to track your progress and test how well you recall the test material. You don’t need to take the full 200-question test every time. Shorter, more focused tests can help you identify improvement areas and strengthen your knowledge of specific subjects.
Toward the end of your preparation period, make sure you are ready for test day by taking the paid, PMI-authorized practice exam. This VCE test follows the same format as the PMP certification exam, giving you a true feel for the official test’s design, questions and time frame.
PMP test Prep Resources
The following resources, excluding PMI’s official Project Management Body of Knowledge Guide (PMBOK® Guide), are completely free and can be used for self-study and reference purposes.
The PMBOK Guide is the foundational resource for all things project management. It details the best practices, terminologies and guidelines that all project managers should know. The PMBOK Guide is a must-have resource for any project manager. It costs only $99 and is free to PMI members.
PMPPracticeExam.org is a free, no-frills resource that helps you prepare for the PMP exam. The site offers four practice PMP exams, each of which contains 50 multiple-choice questions covering three domains: people, process and business environment. This VCE test reflects the same proportions found on the official PMP exam.
Each VCE test is instantly scored and provides detailed explanations for questions answered incorrectly.
PM PrepCast offers a free, 120-question practice test. Each question connects to a specific project management knowledge area and domain. This resource includes a test-timer and a marking feature for self-review. If you are struggling to answer a practice question, you can use the hint button.
PM PrepCast also offers a project management test simulator for $149. This resource includes over 2,280 demo questions with detailed answer notes and helpful references to further your learning.
As a PMI-authorized training partner, the Project Management Academy offers a free 50-question training test to all users. The organization also features 2,000 additional practice questions for Project Management Academy students.
The Project Management Academy’s practice test is based on PMBOK Guide topics. Your test results include explanations for every answer. Keep in mind that to receive your test results, you must input your name and email address.
Quizlet’s user-created study set includes over 1,500 terms and definitions. Quizlet is free, does not require an account and offers multiple self-study options, including a flashcard feature.
With an account, you can use Quizlet’s term-matching feature. You can also generate a test that includes written-answer, multiple-choice, true-or-false and matching questions. If you want a more advanced learning experience, the Study Path feature uses your individual goals to create a study plan.
BrainSensei offers two PMP training modules and a mini practice exam. This resource offers a seven-day free trial.
Each module uses an interactive slide deck and videos to teach project management concepts. The first module is an overview of project management, and the second focuses on initiating a project. Each unit offers self-assessment opportunities, which require users to drag and drop the appropriate vocabulary terms into their correct respective spaces.
This VCE test resource is free and comprises 25 questions. Tests.com organizes its PMP practice questions into five sections, aligned with the five steps of the project life cycle: initiating, planning, executing, monitoring and controlling and closing. Each question is multiple-choice and includes a short description.
This resource is best for quickly testing your knowledge of the project life cycle.
The Simplilearn VCE test is free and based on the PMBOK Guide. It includes 200 multiple-choice questions. Test-takers have 240 minutes to complete the practice exam. They can pause and continue the test at any point and attempt the test as many times as they want.
Taking this lengthy test from beginning to end can help build your mental stamina in preparation for the real deal. Skillup by Simplilearn offers a free PMP basics course if you need more study time before taking the practice test.
Udemy’s free PMP test prep course covers various introductory project management concepts. The five-unit course—plus one paid self-promotion unit—walks through each course using short video lessons that total just 1.5 hours.
The Udemy course can be helpful for those who are just starting project management careers or seeking more information about the PMP exam.
This free 200-question practice test uses Google Forms. Once the test is complete, your results include a final score and provide feedback that references specific sections of the sixth-edition PMBOK Guide.
Some practice questions address concepts covered in the PMBOK Guide, and some refer to Agile or adaptive methodologies. This test can supply you a broad sense of the questions you’ll find on the PMP certification exam. Those interested in the PMI Agile Certified Practitioner test can benefit from this VCE test as well.
Unlike the other free practice exams on this list, this resource offers three difficulty levels. The easiest level is not timed and gives instant feedback after each question. The second has a two-hour time limit and provides feedback at the end. The third and most difficult level limits your time on each question.
This test comprises 90 questions and explains the correct answers after submission. The test also shares your accuracy on each of the PMBOK Guide performance domains, helping you identify areas that might require more study time.
Thu, 04 Aug 2022 03:34:00 -0500Brandon Galaritaen-UStext/htmlhttps://www.forbes.com/advisor/education/pmp-exam-prep/Killexams : Project Management Professional (PMP)® test Preparation
Three times per year
Time to Complete
Open to PME course graduates. Rare exceptions can be made for those already familiar with A Guide to the Project Management Body of Knowledge, (PMBOK® Guide, Sixth Edition). Email a Program Advisor for more information. (View PMI test prerequisites)
PMP® test Preparation, an in-depth review course, is the second online course in this series after Project Management Essentials, offered by Purdue University Online. This offering assumes you already meet the criteria necessary to qualify to take the exam. You must be an experienced project manager (minimum 3 years). Before you may qualify to take the PMP exam, the Project Management Institute (PMI) requires that you have at least 35 hours of project management education. This course assumes you are already familiar with the content of the PMBOK® Guide. If you feel like you need a refresher on the content of the PMBOK® Guide, taking the Project Management Essentials course first, is strongly suggested. Please visit the PMI website for details about PMI’s PMP test prerequisites.
To learn more about Purdue University’s online PMP® test Preparation course and , fill out this form. You can also call (888) 390-0499 to speak to one of our program advisors.
* All Fields are Required. Your Privacy is Protected.
Purdue University respects your right to privacy. By submitting this form, you consent to receive emails and calls from a representative of Purdue University, which may include the use of automated technology. Consent is needed to contact you, but is not a requirement to register or enroll.
PMP test Preparation is a 100% online, self-study course based on the PMBOK® Guide. It includes a series of live webinars presented by your instructor for in-depth review of some of the most challenging learning material.
Enrollment includes 90-day access to all of the Purdue-developed course material, including lecture videos, worksheets/answer keys, and multiple test-taking tips and strategies. Purdue also provides complimentary 90-day access to the PMtraining™ online VCE test website (a $59 value).
PMI’s PMP exam consists of 180 multiple-choice, multiple response, matching, hotspot and limited fill-in-the-blank questions. The test is demanding and students must engage in independent study following the course to pass.
Only individuals who pass PMI’s PMP test are officially certified as a Project Management Professional®. A certificate of achievement from Purdue University, however, is awarded to students who successfully complete the PMP test prep course.
Tue, 17 May 2022 12:27:00 -0500entext/htmlhttps://www.purdue.edu/projectmanagementcertification/pmp-exam-preparation/Killexams : CAPM and PMP Certification Prep Course
Included in your course registration fees, you'll receive The CertWise Learning System for PMP® test Preparation. This premium quality program combines comprehensive printed reading materials with interactive online study materials to expand, apply and solidify your knowledge to pass the PMP exam.
Comprehensive reading Materials
Printed books provide an in-depth exploration of the three domains tested on the PMP exam.
A glossary of key PMP terminology is included at the end of each chapter, with official PMI® definitions.
Progress check questions are included at the end of each chapter to help students check their understanding and retention of topics.
Topics are presented in a concise, easy-to-understand format to cover the PMP® Examination Content Outline.
Interactive Online Study Tools
Participants will have access to interactive online study tools for one year. These tools provide participants with an opportunity to apply and reinforce concepts, evaluate their knowledge, and monitor their growth throughout the course. Over 900 practice questions are included in the following online tools:
Pre-test: Evaluate initial knowledge to identify areas of strength and weakness and focus studies.
SmartStudy™: Build a customized study plan to optimize study time.
Chapter Quizzes: Test comprehension, retention, and ability to apply concepts.
Process Group Quizzes: VCE test questions by domain area.
Flashcards: Review important key terms and definitions.
Practice Exam: Build confidence and set your pace with a timed practice exam.
Progress Reports: Track your activities and scores.
Resource Center: Access helpful test-taking tips, PMP test resources, feedback links, and more.
The registration fee includes the CERTWISE™ Learning System for PMP® test Preparation course materials and online resources, continental breakfast, lunch and break service for in-person Saturday and Intensive programs. Books will be shipped to students via UPS 10 days prior to the class start. Participants will receive an e-mail communication from Holmes Corp with instructions for accessing the online component a few days prior to the class start. If not received within 48 hours of class start, check your spam filter first, and contact Jennifer Kopecky firstname.lastname@example.org or phone 815-753-0771 for assistance if you don't find it there. Students registering within 5 days of class start may not have immediate access to the online resources.
Tue, 12 May 2020 22:56:00 -0500entext/htmlhttps://www.niu.edu/continuing-professional-education/programs/project-management/capm-pmp-prep/index.shtmlKillexams : UAB Project Management Certificate Courses
Recognizing the need for those managing projects to be trained and certified in the Project Management Institute Body of Knowledge (PMBOK®), the UAB Collat School of Business and the Project Management Institute (PMI) have teamed together to offer innovative, engaging, short-term Project Management Certificate Courses with live, online instruction.
In today’s competitive world the effective execution of value-adding business processes and related projects is imperative. The UAB Project Management Certificate Courses' approach provides the content and rigor of graduate level academic coursework and practicality provided by practicing project managers; yet, as a professional course, there is no application fee or admission process
These popular open-enrollment courses are offered several times a year through the UAB Collat School of Business Professional Education Office. Join us and learn from PMI-trained, seasoned instructors; enjoy networking with a cohort of like-minded professionals; and prepare to earn industry certifications like the CAPM and PMP!
Discounts are available for UAB employees and students, veterans, and companies with 3 or more students in the same class. See course offerings below for specifics.
Individuals with a PMI certification will be able to waive a graduate level elective (3 credit hours) in UAB's MBA program.
Tue, 10 May 2022 09:38:00 -0500en-UStext/htmlhttps://www.uab.edu/business/home/businesscertificates/project-managementKillexams : CertWise™ Essentials of Project Management Program
Areas of instruction: project management, human resources Current position: business transformation director, ADP
Stephanie has over eighteen years of experience driving strategic changes within multiple large multi functional organizations. Working with Executive Leadership teams she helps develop and lead strategic programs to Improve organizational effectiveness and profitability. Stephanie holds a BA in Business from DePaul University and a MBA from Northern Illinois University. She also holds the following professional certifications; Project Management (PMP), Senior Professional Human Resources (SPHR), Society for Human Resources Senior Certified Professional (SHRM-SCP) and is a Six Sigma Green Belt.
Mon, 01 Jun 2020 17:34:00 -0500entext/htmlhttps://www.niu.edu/continuing-professional-education/programs/project-management/essentials/index.shtmlKillexams : What are the Best Qualifications for Cybersecurity in 2022?
Cybersecurity is one of the most significant areas for ensuring the success and longevity of a business. As the scale of cyber-attacks increases, company owners must supply protection to their business by recruiting skilled cybersecurity experts.
Since all industries are looking for safety and security for their data, the demand for cybersecurity is increasing day by day. It is the best time to start your career in network security as the number of jobs is expected to increase by almost 33% by the year 2030. So, here, we will discuss the information regarding cybersecurity certification and as a career choice.
What Is Cybersecurity?
Many organizations have already begun looking for cybersecurity to protect essential data from cybercriminals or hackers from government sectors to private sectors. Cybersecurity is mainly the practice to protect the networks, mobiles, data, servers, and systems from digital hackers. It is also called Information Technology Security. Also, many cafes, hotels, and restaurants are now using billing software for generating invoices safely.
Cybersecurity Certification Programs
Let’s know about the cybersecurity certification programs below:
1. CISSP (Certified Information Systems Security Professionals)
A CISSP certification will prove that you are experienced and skilled in IT security and can design and monitor the cybersecurity program. This Cybersecurity Professional Organization certification has ranked as the most sought-after credential in this IT industry. As per the statistics, almost 38% of people got this CISSP certification in 2021 worldwide.
2. CISA (Certified Information System Auditor)
This certification of the ISACA organization demonstrates your expertise in reporting on the security vulnerability assessment, reporting on compliance, and designing and implementation.
3. CISM (Certified Information Security Manager)
This certification from the ISACA organization lets you test your expertise in data security management, including issues like administration programs, program events, program development, and risk management.
4. CompTIA Security+
It is an entry-level security certification that verifies the core competencies required in any cybersecurity role. This certification demonstrates your capability to assess an organization’s security, monitor, and protect the cloud, IoT environments, mobile, etc.
5. CEH (Certified Ethical Hacker)
It is a certification offered by the EC-Council. You can get it to prove your skills in attack detention, prevention, penetration testing, and vectors.
6. GSEC (GIAC Security Essentials Certification)
GIAC offers this entry-level certification to those who have a background in networking and information. You can earn this certification to validate your skills in network security, cloud security, cryptography, etc.
7. SSCP (Systems Security Certified Practitioner)
This certificate shows that you are well-skilled in designing, implementing, and monitoring a secure IT infrastructure.
8. CASP+ (CompTIA Advanced Security Practitioner)
This certificate is specially designed for those cybersecurity professionals who have advanced skills but want to work in technology, not management.
9. GCIH (GIAC Certified Incident Handler)
Acquiring GCIH certification legitimates your understanding of offensive cyber activity, including general attack tactics and your ability to detect, respond, and defend against vectors and attacks.
It is one of the well-known certifications that is mainly for penetration testers. You can validate your ability to produce penetration test attacks for every attack through the certificate.
Cyber Certification Organizations
There are lots of major cybersecurity certification organizations in the market. You can choose a reputed organization depending on your ability and skills to get a certificate in cybersecurity. Once you get your certification done from any of the well-known organizations then any reputed company will acknowledge you. So, it will be best if you get the certificate from a well-known organization. Some of the organizations that are highly reputed in this cybersecurity market are:
Information Systems Audit and Control Association- ISACA
International Council of E-Commerce Consultants- EC-Council
Global Information Assurance Certification- GIAC
The International Information System Security Certification Consortium- (ISC)2
CompTIA- The Computing Technology Industry Association
Best Cybersecurity Certificates
1. CISSP – You will need at least five or more years’ experience to qualify for the examination and get the certificate.
2. CISA – You need at least two years of experience in the IT sector or security, IS audit, control, or assurance.
3. CISM – If you want to appear in this exam, you must have five years’ experience in information security management.
4. CompTIA Security+ – You don’t need any experience to appear in the examination, but you can earn a Network+ certificate and gain two years of experience.
5. CEH – Candidates can apply for this examination to get the certificate if they have two years of experience in Information Security.
6. GSEC – You can apply for the examination to get a certificate in computer networking.
7. SSCP – Candidates need to have one year of experience in one or more testing areas to appear in the examination. You get a certificate if you qualify for the exam.
8. CASP+ – You can get this certificate if you have 10 years of experience in IT administration. It is mainly for experienced professionals.
9. GCIH – This certificate is for those interested in security principles, windows command line and networking protocols.
10. OSCP – It is recommended for those interested in Linux, Python, or Bash Scripting.
How To Choose the Best Cybersecurity Certification?
Earning the cybersecurity certification means you are validating your skills so that it can help you to grow in your career. But you should consider some things before opting for the proper certification. Those are:
1. Experience Level
Choose your certification depending on your experience level. It will benefit you as you will get validation for your experience. For instance, if you’re in the position of a project manager for a cybersecurity department then it would be useful for you to also follow a PMP Certification training to enhance your leadership and managing skills.
Cybersecurity certifications are very costly, and you may have to pay additional hidden charges. The correct certification will eventually offer you a high-salary job in the future. Make sure to invest wisely as almost 40% of employees said that their organizations had paid their course and test fees.
3. Choose Domain Expertise
If you are new to the cybersecurity field, it will be best to choose a general certification. Focus on your expertise area first, then go for certification as per your expertise level.
4. Proper Research
Before choosing any cybersecurity certification, conduct proper research and check various job portals. Through this, you will know what type of certification is in demand.
Almost every company is searching for cybersecurity professionals to protect their data in this technological era. So, now is the best time for you to choose cybersecurity as your career. If you think you are well-skilled in cybersecurity and have potential in that area and experience, you can apply anywhere at your convenience.
Thu, 28 Jul 2022 03:23:00 -0500by Blog Feed on July 28, 2022en-UStext/htmlhttps://securityboulevard.com/2022/07/what-are-the-best-qualifications-for-cybersecurity-in-2022/Killexams : Business Management Program Helps Students Set Themselves Apart
As Madison Koch CAPS’22 nears the completion of Bethel’s B.S. in Business Management program, she’s confident that she has set herself apart as she pursues the next steps in a marketing career. That’s because along with earning her degree, Koch has received multiple industry-recognized certifications while completing the program. “I would say these certifications are an essential component of my success thus far,” she says.
Bethel’s B.S. in Business Management program now has many industry-recognized professional certifications embedded into its courses. “This is an innovative way to allow students to earn industry-recognized credentials while they are earning their business degree,” says Molly Wickam, program director of the B.S. in Business Management Program. The certifications are a key way for students to get ahead in the job market since they’re a way to show employers that someone is proactively working to gain skills. “Employers are looking for employees to take charge of their own upskilling to stay current with their jobs,” Wickam says.
The industry or professional certifications are credentials awarded by certification bodies—typically nonprofit organizations, professional associations, industry/trade organizations, or businesses. Such certifications are based on a person demonstrating that he or she has acquired the knowledge, skills, and abilities required to perform a specific occupation or job. After gaining the skills and knowledge through their Bethel courses, students take an test to earn the certification. Many certifications offer practice questions along the way for students to assess their knowledge. And most allow one free retake to pass the exam. And Bethel has negotiated reduced pricing for the certifications with each certification provider. “If students took the certifications outside of Bethel, they could do so but would pay more,” Wickam says.
Mon, 18 Jul 2022 03:56:00 -0500text/htmlhttps://www.bethel.edu/news/articles/2022/july/business-management-certificationsKillexams : Collat Professional Education Open Enrollment Programs
The 100% online, self-paced CISSP® test Prep Course prepares test-takers for the Certified Information Systems Security Professional exam, as administered by the International Information System Security Certification Consortium (ISC)2. Guaranteed test passing. Estimated time to complete is 40 hours.
Estimated length: 40 hours.
Access time: 180 days
Credits: 4 IACET CEUs / 40 PMI PDUs
$549 - UAB employee/student, veteran or company with 3 or more students in the same class receive a 20% discount with code BlazerStudent
In this 100% online, self-paced course, managers are introduced to essential information security principles and concepts. These concepts are critically important in the healthcare sector as a data breach can have far-reaching consequences for individuals and organizations. Beyond financial losses and the embarrassment of having personal information exposed online, a security breach in healthcare can result in a patient becoming seriously injured or killed. This course is designed to help managers navigate crucial cybersecurity concepts as applied to HITECH and HIPAA-covered entities. Learners will explore the reasons why breaches occur, the motivation of attackers, and how to protect Personal Health Information (PHI) while it is in use, in storage, and in transit across a network.
Estimated length: 5 hours
Access time: 90 days
Credits: 0.5 IACET CEUs
Learner satisfaction: 100%
$99 - UAB employee/student, veteran or company with 3 or more students in the same class receive a 20% discount with code BlazerStudent
The 100% online, self-paced data analytics certificate provides an overview of courses in statistics and their applications in a variety of fields. This certificate will present the basics of quantitative analysis and its increasing use in today's professional landscape.
Combined “Live Online” and asynchronous online instruction that provides key practical knowledge and insights into the latest trends in digital marketing. Most course offerings occur over four consecutive Thursdays. Includes Google Analytics & Hubspot Inbound Marketing certificates.
9:00am - 12:00pm
- $1295 for a UAB employee/student, veteran or company with 3 or more students in the same class. - 20% early bird discount if you register at least 30 days before the start date of class. Discounts can stack.
This 100% online, self-paced course teaches the fundamental concepts of information security one will encounter in the cybersecurity field. Globally, incidents of data breaches, identity thefts, and cybercrimes are on the rise, along with the explosive growth of online personal data and the expansion of computer networks. This course will set the groundwork with basic vocabulary and then introduces concepts such as access controls, risk management, cyber attacks, and digital forensics. This course requires a basic understanding of IT concepts.
Mon, 16 May 2022 17:52:00 -0500en-UStext/htmlhttps://www.uab.edu/business/home/departments-centers/centers-outreach/professional-education/open-enrollment-programsKillexams : Make yourself marketable for project management positions with this 100-hour course bundle
Project management is one of those transferable skills that are usually pretty in-demand. It’s also a skill that could be hard to learn if you don’t have a dedicated teacher or a way to learn it in practice. To that effect, The 2022 Premium Project Management Super Prep Bundle could help you learn basic and advanced project management skills, and for a limited time, it’s only $59.99 (Reg. $999).
The role of a project manager involves a diverse skill-set that tends to shift depending on the job or industry it’s applied to. Start developing core project management skills as this bundle leads you through real-world scenarios with study aids and tips, and gives you access to helpful learning tools. Whether you have your eyes on a position as a team leader, an IT manager, or many other Project Management positions, this bundle could be helpful in showing you the ropes early on.
Courses are taught by professionals from Integrity Training, a source for many professional training courses. All materials are available to you for life, so you can learn and internalize new skills at your own pace. Take your time working through all 47 lessons contained in this bundle, accessible from a desktop or mobile device.
This course claims to cater to all experience levels, so whether you’re completely new to project management or have some experience under your belt, you may have something interesting to learn.
Whether you are just starting or need a refresher, this bundle may be able to help you internalize what it takes to be a project manager, a set of skills that could be useful across fields and disciplines. For a limited time, get The 2022 Premium Project Management Super Prep Bundle on sale for $59.99 (Reg. $999), a discount of 93%.
There hasn't been much of a change to the investment backdrop. The "issues" that were identified and appropriately labeled as "game changers" earlier this year, are still with us. The path of the equity market will be determined by how long these headwinds last.
Corporate America is still playing a "catch-up" game to confront falling demand. Inventories in Q1 surged at the second-fastest rate since the mid-1970s. That pushed the inventory-to-sales ratio to early 2007 highs and spilled over to the poor manufacturing and services data we have seen lately. In addition, the regulatory backdrop continues to pose issues for Financials to Energy, and everything else in between.
The Housing market is caught between a high-priced, low inventory landscape combined with 30-year mortgages at 5%-6% making affordability an issue. With the Fed aggressively raising rates, mortgage rates are unlikely to fall back. The supply of homes also looks to stay tight. Baby boomers, who hold 58% of the value of the housing market, tend to stay put. Housing starts and builder confidence keep slipping. After all, they simply can't be aggressive in building given the poor fundamentals.
There is no way to sugarcoat consumer sentiment. It's at historic lows. A recent Monmouth poll found an astounding 87% of Americans believe the country is on the wrong track, one of the worst right track/wrong track readings ever registered. To top it off, several key elements of inflation—rents, wages, and food—could run hot for some time, forcing the Fed to choose between recession (which in the past always stopped inflation) and higher unemployment.
As we have discussed these issues are all KNOWN, and they are the reasons the S&P 500 and the other indices slipped into a BEAR market. The equity markets have priced in this 'first leg" down in the global economy. It will be "what comes next" for the economy that is the determining factor for equity prices.
DOUBLE DIP RECESSION
What? We haven't had an official recession declared yet and he is talking about a "double dip"? OK, let me explain. Remember, this is a MACRO view that highlights what scenarios are possible as this entire "change" unfolds. Like the market itself, I keep an OPEN mind to all probabilities. In the interim, overreacting to one or the other based on a "feeling" or a "biased opinion" that we all are capable of conjuring up is a recipe for disaster.
The prevailing view believes what we are witnessing today in the economy has already been priced into stocks and this trough will not be as bad as some project. There are signs of improvement that add credibility to this theme.
Supply chains are normalizing. There’s also been broad-based improvement as shipping costs and delivery times are declining rapidly. Backlogs are clearing and parts shortages related to the Russia-Ukraine war have largely dissipated.
Capex is on the rise. Often one of the first areas to be cut during a slowdown, capital spending has risen at a healthy 7% annualized pace over the last six months, breaking out of a range where it’s hovered since 2000. The Business Roundtable says CEOs are committed to investing and are more confident about the economy than they were leading up to either the 2008-09 or 2020 recessions. In another sign of confidence, businesses continue to raise dividends, too.
Perhaps that adds credence to the notion corporate earnings aren't going to fall off a cliff as the economy slows. We have seen that so far during this earnings season. So the consensus view says after this mild recession where corporate earnings remain resilient, economic growth will pick back up. That leads to equity prices stabilizing, and stocks enter a trading range before coming to grips with the next step in what could be the start of a recovery.
THE "OTHER" CASE
Conversely, a double-dip scenario is also a distinct possibility. The economy will still have to deal with the inflationary effects from all of the liquidity poured into it post Covid. That excess won't disappear quickly and will hang on longer than most want to believe. We already know that a HIGH inflation backdrop that persists brings plenty of economic baggage with it. Additionally, the transition to an economy that has become conditioned to easy money won't go as smoothly as anticipated. After running at a record rate during the pandemic, growth in the nation’s money supply is slowing fast and, could be starting to contract. That would be an extremely rare event.
We are now experiencing a period where the Covid fiscal stimulus stopped abruptly and the economy will be trying to deal with the withdrawal of some $9 trillion of support. It's not only the liquidity issue, it's a change to a higher interest rate environment as well. The effects of changes in the money supply tend to be felt with a 12-18-month lag. More importantly, it will be dealing with this "disappearance" into late 2023-24, just when the economy may need it.
Many research firms are in agreement. They believe we are in the early stages of unwinding what was wound up during the fastest liquidity (P/Es) and EPS (stimulus checks) bubble ever. Given this extremely elevated starting point, large drawdowns in equity prices and P/E multiples, and eventually earnings well beyond a normal recession can be expected. The duration of this downturn will mirror the same time and magnitude of the tightening that caused it. There is plenty of common sense in these arguments.
So after this first dip/recession in economic activity, there won't be a quick return to economic growth. Instead, after a period of stabilization, the negative forces remain in place and are exacerbated by the conditions mentioned above. The Fed is keenly focused on the level of inflation, which according to its forecasts, will take far longer than six months to get near its 2% target. I'll also note that this tightening cycle has just begun, it will take at least 6-9 months before the effects of the first-rate hikes are felt. Expecting 8% inflation to drop to 2% in 6 months is very unrealistic. Some suggest inflation will remain at elevated levels well into 2023. I also lean toward that assessment.
I am not in the camp that is counting on a FED pivot anytime soon because inflation has slowed (if indeed it does). The Fed will end this rate hike cycle when inflation starts to fall off a cliff and that could be due to a severe double-dip recession. The mild recession camp says the FED continues to tighten and inflation does fall quickly setting up a mild recessionary backdrop. I'll need to see more evidence before I can subscribe to that 'theory'.
No one has all the answers nor can anyone predict the future. Either way, it seems to me the FED is in the picture for a while. What have we learned during the BULL market? - Don't fight the Fed.
The Fed is here to slow things down. That tells us many challenges lie ahead.
The Week On Wall Street
The Major indices all started the week at slightly overbought conditions sitting at overhead resistance. The S&P entered the week on a 12% rally of the lows and the general feeling seemed to be it was time for a pause. That's exactly what occurred on Monday and Tuesday as the S&P posted modest losses on both days.
This week it was a "Turnaround Wednesday" that took some traders by surprise. The S&P rallied and the NASDAQ which already posted a 16% gain off the lows, added 2.5%. After that, it was a "give and take" scene for the indices that was filled with indecision. Both the BULLS and the BEARS were not quite sure what to make of both the fundamental and technical backdrop that they are faced with.
The S&P, NASDAQ, and the Russell 2000 made it three weeks in a row with gains. The DJIA couldn't quite get to positive territory, posting a modest loss for the week.
The latest JOLTS report showed the number of job openings decreased to 10.7 million on the last business day of June. Hires and total separations were little changed at 6.4 million and 5.9 million, respectively. Within separations, quits (4.2 million) and layoffs and discharges (1.3 million) were also little changed. This release includes estimates of the number and rate of job openings, hires, and separations for the total nonfarm sector, by industry, and by establishment size class.
A blowout JOBS report. Nonfarm payrolls surged 528k in July, much stronger than forecast. That's the best since February. If follows gains of 398k in June and 384k in May. The unemployment rate dipped to 3.5% from 3.6%. Average hourly earnings popped 0.5% from 0.4%. The 12-month pace was steady at 5.2% y/y, with June revised up from 5.1% y/y. The labor force participation rate slipped to 62.1%, the lightest since December, from June's 62.2%.
This report is positive and it confirms my view that interest rate hikes have yet to work their way into the economy in a negative way.
Manufacturing and Services reports continue to show weakness, and once again we are left to ponder whether this is the bottom.U.S Manufacturing SLOWS, but there is GOOD news on supply chain and Inflation.
ISM manufacturing index dipped 0.2 ticks to 52.8 in July, marginally better than projected, after falling 3.1 points to 53.0 in June. This is the lowest since June 2020s 52.4 reports. It was at 59.9 a year ago. The components were mixed but the big highlight was the collapse in prices paid where the gauge plunged -18.5 points to 60.0, the lowest since 2010 and the fourth largest drop since the ISM began tracking in 1948. That reflects improving supply chain activity and is potentially good news on the inflation scene.
Construction spending dropped 1.1% in June, weaker than expected, following the 0.1% gain in May. Weakness was broad-based. Residential spending tumbled 1.6%, with private spending down 1.3%.
July Services PMI was revised up to 47.3 in the final read from the 47.0 preliminary. But it is in contraction territory for the first time since June 2020. The July reading is down 5.4 points from the 52.7 in June and is off 12.6 points from the 59.9 a year ago. It is the lowest since May 2020. The prices charged index slid to 60.4 from 62.9 and is the lowest since March 2021. Another positive for the inflation picture.
The United Kingdom is now projected to enter recession from the fourth quarter of this year. Real household post-tax income is projected to fall sharply in 2022 and 2023, while consumption growth turns negative.
None of this is a big surprise. HIGH energy costs seep into every part of the economy. I suspect the EU will also share the same fate.
Global PMI Data
The Eurozone manufacturing sector dips into contraction.
China’s official manufacturing purchasing managers’ Index fell to 49.0 in July from 50.2 in June. The reading was the lowest in three months, with sub-indexes for output, new orders, and employment all contracting. Continued contraction in the oil, coal and metal smelting industries was one of the main factors pulling down the July manufacturing PMI. Manufacturers continue to wrestle with high raw material prices, which are squeezing profit margins, as the export outlook remains clouded with fears of a global recession.
Bruce Pang, chief economist and head of research at Jones Lang Lasalle Inc;
Weak demand has constrained recovery. Q3 growth may face greater challenges than expected, as recovery is slow and fragile.”
Services PMIs in China recovered from the shock of the COVID lockdowns while other global Services PMIs are decelerating.
U.K. Services PMI - The weakest service sector performance since February 2021 as inflationary pressures continue to dampen demand. The index remains above contraction territory at 52.6.
There is little need to get into a debate on the recent developments taking place in Taiwan. Each side can make a compelling case for the actions being taken. It's doubtful there will be any military escalation by China. There is no need to go that route. They have a weapon that can cause plenty of damage in a very subtle way. The more important issue now is the potential "supply chain" disruption that can become an overhang as a result of a strained US /China relationship.
We have learned a harsh lesson from the Covid event. The U.S. is still far too dependent on China for plenty of goods that are "essentials" to the US economy. The recent China zero covid policy that produced lockdowns has prolonged a supply chain issue that was on the mend.
This economic weapon is a real threat to any recovery here in the U.S. I expect there could also be an effect felt by US retail corporations doing business in mainland China.
Let's also not forget China's cozy relationship with Russia, and what could bring to the future global scene.
Here is the first example of the economic fallout from the recent tensions over Taiwan looks like. Early this year the largest EV battery maker in the world was eyeing locations here in the U.S. to support U.S based automakers.
In addition, the battery maker was also investigating a Mexican location as another possibility to expand operations. However, Chinese EV battery giant CALT has put its plans to build a Battery manufacturing plant in North America on hold. With tensions elevated, it is now a big question mark whether the US will remain a candidate for that investment.
The 'Bottoms Up" 2022 consensus EPS expectations for the S&P 500 have declined from $228 to $224 since July 1, but 2022 EPS expectations for the Mid Cap 400 and Small Cap 600 have increased modestly in the earnings season. That is highly unusual during times of an economic slowdown as typically the higher operating and financial leverage of small/mid caps make earnings come down faster than large caps.
I believe we are seeing evidence of the negative impact of global exposure on index earnings. Earnings expectations are decelerating faster outside the U.S. than inside, which hasn’t really occurred in at least the last 20 years, and so far, allowing small and mid-cap earnings to hold up better than large cap. I also note that earnings in value indexes are holding up better than earnings in growth indexes, for what I suspect is the same reason, as there is more global exposure in growth indexes.
This earnings season is the first time since COVID hit that guidance cuts are more frequent than guidance raises. Investors feared the season would be one where the tone would change and that appears to be the case.
FOOD FOR THOUGHT
The Joint Committee on Taxation analysis reveals the Inflation Reduction act (aka Green new deal) won't reduce inflation. In addition, the administration's favorite Economist says this legislation will not reduce inflation. Also in agreement with that conclusion is the Congressional Budget Office. The bill also won't reduce the deficits as announced. Instead, this legislation will actually increase net deficits in the 2023- 2026 time frame.
The “paying down our national debt” that Sen. Manchin refers to won’t start occurring for five years. The “lowering [of] energy costs” involves investments in future technology that will require years to develop and take effect. And the “lowering [of] healthcare costs” doesn’t take effect for years (as with the prescription drug price controls) or merely masks high health care costs rather than meaningfully addressing them (as with the ACA subsidies)."
By incorporating financial accounting further into the tax law, the proposal would add substantial complexity to the Code. The Act leaves critical details to be provided for by guidance from the Treasury Department and IRS. That guidance will have significant tax consequences for taxpayers and will be subject to review in an era of heightened judicial scrutiny of agency rulemaking. In addition, because the creation and modification of financial statement rules is not subject to Congressional approval or the notice-and-comment requirements of the Administrative Procedures Act, the proposal would result in the calculation of tax liability being determined by decisions made by a relatively small group of unelected, unregulated decision-makers.
The Joint Committee on Taxation, concludes that taxpayers across the spectrum of incomes will indeed see their taxes raised. Raising corporate taxes in any form will always find its way into the pocketbooks of employees and consumers. Those that are happy with the direction of the economy and in favor of this tax bill won't have their opinion changed, nor will we see a change of opinion for those that are watching the economy and the market sink lower under the poor policy decisions. Therefore from an investor perspective, it's out of our control leaving little reason to debate this legislation.
However, there are investment ramifications.
The losers are as always the fossil fuel industry along with additional taxes and regulations, and increased costs for drilling leases are included in this legislation. Ironically that makes energy an even better investment. Fewer incentives for drilling and production will keep supply low and prices high.
The real winners are the "greenies", as they will see money tossed at alternative sources and from an investment point of view that has provided a lift to those sectors. While they "win" the taxpayer loses. So far the more than a decade-long effort to bolster this group of companies hasn't produced much in the way of measurable help for energy needs.
An investor looking at the bottom line of the "alternative energy" group can conclude that the return on investment has been abysmal. I am very much aware that history shows other industries have been key beneficiaries of subsidies. I also acknowledge that subsidies have been the "American Way". The problem this time around; probabilities remain high that more of these "speculative ventures" will fail to produce meaningful results until these alternatives are ready for mainstream deployment.
There is an issue that can be debated because we have witnessed firsthand the mounting evidence that this "'adaption" process will take a lot more time (perhaps never) before it will be able to compete with the reliable sources of energy the world uses today. "Reliable" is the operative word.
Bottom Line - Only those who worship at the altar of climate change wish to "tax and spend" while the Fed is raising rates to slow an economy racked by inflation. All while keeping energy costs high by choking off supply.
Therein lies the issues for investors to ponder.
It has been over a decade since the last time S&P 500 futures positioning has seen a double-digit net short reading, but that is what the latest Commitments of Traders report revealed. Going further back through the history of the data to 1996, there have only been seven other occurrences that have happened with at least six months between the last.
Historically, that overwhelmingly bearish reading on positioning has tended to be a bullish signal for performance. While these readings have been rare in recent history, these past occurrences have consistently seen the S&P 500 trade higher over the next year with consistently stronger-than-average moves.
However, the following three-month performance is perhaps the most impressive with the S&P 500 higher each time.
The rally off the June lows has now taken the S&P 500 slightly above the June highs. This pattern is being played out in nearly all of the major indices as well.
There is an equal chance the S&P can move to the next major resistance level at ~4300, OR head back down to test initial support around S&P 3900.
That leaves a trading range of abut 400 points where literally anything can occur without upsetting the short-term BULL rally or the long-term BEAR trend. Our first view of the crossroads an investor faces today.
Investors have navigated a couple of tough weeks with EPS reports on the mega caps and the FOMC meeting and this recent rally leaves the S&P right at resistance.
There may not be an official start date, but August represents what many consider the dog days of summer when, for a lot of people, the market is the last thing on their minds. Historically, there have been a number of calamitous events that began or transpired in August, but overall stock market returns during this time of year have been middling. September has had a median gain of 1.15% while the next three months have seen a median gain of 2.75%. Nothing especially notable, but the way this year has gone, a gain is a gain.
While it's not wise to rely on the calendar alone, from a seasonality perspective, the market is entering a period historically characterized by increased volatility and continued choppiness in the market as well. That suggests the recent move higher may not be durable. VIX seasonality tends to increase starting about now. Moreover, the increased volatility in the near term has been consistent with some sideways consolidation in markets.
The fundamental backdrop is filled with conflicting data. The first half saw negative GDP growth and economic reports around the globe are aligned with a slowdown. Strong jobs report here in the US bolsters the no-recession talk, while the UK is talking about a long recession, and with energy costs still high, the EU is sure to follow. Add all of that to a technical view that suggests the equity market is at a crossroads, leaving investors scratching their heads.
Whether this 14% rally off the June lows has run its course remains to be seen. For now, however, I will continue to proceed with a mind on following the strategy that has turned this BEAR market into a profitable year. Protecting my capital, adding to quality when given the opportunity more than growing it at any cost, and following what is "working". If you don’t want to go that route and instead bet that we’ve already seen the worst, that the bear market is over, and we’re going back to new highs, more power to you.
I haven't lost sight of the fact that the long-term trend patterns for ALL of the indices are still BEARISH. When that changes I will change, but not a day sooner.
I've navigated the first part of this difficult "change" in market behavior, and I don’t want to get reckless now. If that means I underperform the major indices during a rally that goes straight up, I am ok with that. I’d rather continue to make sure I don’t get overextended in a questionable backdrop, and lose money by focusing exclusively (Greed) on making money.
When the trends do go back to a full-blown BULL market setup there will be plenty of time to make money in that trend. We aren't there yet.
Thank you for reading this analysis. If you enjoyed this article so far, this next section provides a quick taste of what members of my marketplace service receive in DAILY updates. If you find these weekly articles useful, you may want to join a community of SAVVY Investors that have discovered "how the market works".
The 2022 Playbook is now "Lean and Mean"
Opportunities are condensed in Energy, Commodities, and Healthcare. Along with that I've defined Bearish to Bullish reversals in three other areas of the market that have led to massive gains (30+%) in the last two months. The message to clients and members of my service has been the same. Stay with what is working.
Each week I revisit the "canary message" which served as a warning for the economy. The focus was on the Financials, Transports, Semiconductors, and Small Caps. I used them as a "tell" for what direction the economy was headed to help forge a near-term strategy. With the major indices showing some signs of stabilization, it might be a signal that is now lining up with the "consensus" view of a "mild recession".
I'm not there yet but if the price action tells me that, I will gladly reconsider my forecast.
The technical view on the small caps as measured by the (IWM) looks EXACTLY like the S&P and the DJIA. Indices that are at pivot points.
From the fundamental viewpoint, longer-term investors might be witnessing an opportunity for outperformance on the other side of this bear market. The group trades at just a 13x P/E (vs 18.2x average), which is the lowest valuation of the past 20 years other than the Covid shutdown and credit crisis lows. On a relative basis, the small caps trade at a 32% discount to the large caps (vs 6% premium on average), which is the lowest relative multiple outsides of the Covid shutdown low.
Other than Energy most if not all of the other sectors have produced nice rallies off the lows. The true test is upon us and many chart patterns are aligned right at key resistance levels.
The commodities in this sector could become interesting again. It is easy to look back with the benefit of hindsight and pick out winning themes that would have made you a lot of money if you had only held on during a long-term move. In practice, it is MUCH harder to not only identify those themes in real time but also to hold through the inevitable volatility that arises. That is the issue that trips up most investors. Nothing goes straight up, even during strong uptrends. Shakeout moves happen, especially when a theme gets too popular and too many jump into the idea.
At the first sign of trouble, however, these weak holders/traders bail and that can send prices down quickly. I think that’s what we’ve seen in areas like Energy and Agricultural commodities, which have pulled back from their year-to-date highs after climbing considerably in the first few months of 2022. The physical supply issues, though, that I believe are powering these themes have not gone away and in some cases are only likely to get worse.
So, “food and energy” remain two favorite investment themes for me and most of my portfolio holdings reflect this. Agriculture ETF (DBA), for example, holds a basket of agricultural commodities like Soybeans, Wheat, Corn, and Cattle and has pulled back around 15% in the past few months.
DBA has now pulled back to an area of longer-term support. Of equal and possibly more important to me is the fact that despite the pullback, many stocks/ETFs remain in longer-term BULL market trends. Investing here is riding the tailwinds of a positive trend.
Oil prices stabilized, moved higher, then reversed lower after OPEC+ only increased production by 100K barrels/day. In the scheme of global oil production that is a "rounding error", but forecasting the daily moves in the oil market can be quite frustrating.
Meanwhile, the Strategic Petroleum Reserve release will end in October and at some point, those reserves will have to be replenished. Supply will continue to be "tight" and if demand stays stable energy prices should remain at or near these levels. With WTI closing at $88.50 on Friday, the Energy ETF (XLE) remains above support levels and in a BULLISH trend.
At the moment there is little reason to leave this sector, (LT BULL trend) and once again I continue to recommend the stocks that offer "base and variable" dividends to shareholders. I'm collecting 8-10% yields on select energy stocks that have pristine balance sheets.
For those that want less volatility, there is nothing wrong with being involved in (CVX) or (XOM) at these levels as well. BULL market trends with above-average yields. Those two attributes represent an opportunity to make money in a BEAR market.
There is volatility in the sector (UNG), but I'm staying with a position that is also in a Primary uptrend. The tailwinds for higher prices remain in place and adding on weakness has been profitable. Another situation where there are tailwinds for higher prices in the future.
Financials (XLF) may have put in a double bottom in June/July and so far the rally off those lows continues. There is plenty of resistance overhead and the road to full recovery is a very long one. Perhaps this is the first step. I remain neutral on a group that is still mired in a primary downtrend.
The Healthcare ETF (XLV) continues to track sideways, but the real value is presented in what I mentioned in earlier reports. Involvement in pharma stocks that are in BULL trends with above-average yield continues to be my recommendation. (ABBV), (PFE), and (MRK) are examples of what I am referring to.
Dividend income and "Value" lie within big pharma and "Growth" is in the Biotech ETF (XBI). This group that I have been tracking moved into a sideways pattern after its BIG move off the lows, then reignited. The ETF added 12% this week, easily outperforming other sectors. The BEAR to BULL reversal pattern that was uncovered here in June is still active and has now yielded a 40+% gain.
Most of this recent rally has been fueled by a move from "Value" to "Growth". The "Energy" trade has given way to the "FAANG" trade. I prefer to stay with both leaving Energy as "overweight" due to the income stream and Technology as an "equalweight".
Tech Sub Sector - Semiconductors
Semiconductors (SOXX) have been outperforming the general market for a few weeks now. However, there is a lot more work that needs to be done before we can start to throw caution to the wind. The ETF is now up against the top end of the down-trending channel that began in January. While I am not a seller here, I'm also not recommending anyone to be aggressively buying until the potential "turn" looks more constructive.
The other BEAR to BULL reversal we are tracking is in the ARK Innovation ETF (ARKK). Similar to the Biotechs this ETF traded sideways recently and broke to the upside this week. There is a defined 'base" pattern in place that could be set up for an eventual move higher. As with any stock or ETF that has been in a decided downtrend, there are many hurdles to overcome on the road back,
I don't expect a moonshot to higher levels but if this reversal pattern is genuine we could see more of a stair-step move to higher prices over time. However, please do not lose sight of the fact that this is still a "speculative" group of stocks. My gains off the June lows stand at 42%.
Alongside equities, Bitcoin and other cryptos pushed higher and then settled into what (for crypto) has been a narrow trading range between $22k-$24k. As we have seen in the past, cryptos and equities have been positively correlated to one another recently, and that has especially been the case for the mega caps.
Last week we saw the horse placed before the cart as the solid results and even more solid reaction to mega-cap earnings likely assisted in boosting risk sentiment to lift cryptos higher. With the coincident moves higher in cryptos and Bitcoin, Bitcoin has successfully tested and held above its 50-Day MA while breaking the downtrend that has been in place since April.
The longer-term downtrend from the fall highs and the 200- Day MA, however, are both considerably higher than where BTC closed (~23k) on Friday.
The most difficult issue for any investor to come to grips with is how much of the "change" has taken place and is priced in. That is precisely what the universe of investors that make up the equity market is trying to figure out now. I expect this back-and-forth price action should continue for a while.
This last BEAR market rally has felt a little different and also has presented other indicators that separate this move from the prior BEAR rallies. The weight of evidence for both the fundamental and technical sides of the investment equation is still dominated by uncertainty.
It's best to not get discouraged on the down days and don't get euphoric during the rallies. I intend to maintain an even keel and ride this BEAR market storm out by staying in control. I plan to stay at these crossroads for a while in an effort to determine which one offers the best path to profits in the near term. Running too fast in one direction now can lead to plenty of mistakes.
Please allow me to take a moment and remind all of the readers of an important issue. I provide investment advice to clients and members of my marketplace service. Each week I strive to provide an investment backdrop that helps investors make their own decisions. In these types of forums, readers bring a host of situations and variables to the table when visiting these articles. Therefore it is impossible to pinpoint what may be right for each situation.
In different circumstances, I can determine each client’s personal situation/requirements and discuss issues with them when needed. That is impossible with readers of these articles. Therefore I will attempt to help form an opinion without crossing the line into specific advice. Please keep that in mind when forming your investment strategy.
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