ACTIONABLE ADVICE FOR FINANCIAL ADVISORS: Newsletters and Commentaries Focused on Investment Strategy

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Recent Articles

The Active-Passive Debate Revisited

by Bob Veres

Asset flows to passively managed funds are surging. But, as often happens, advisors are embracing a trend just as debunking information is arriving in the marketplace. New research is showing that selecting above-average active funds may not be the impossible task that the academic research has suggested.

Are Investors Overexposed to Non-Guaranteed RMBS?

by Keith Jurow

Let’s look at some recent data that shows the extent of the delinquencies in non-guaranteed mortgages with a focus on the most exposed large metro areas. We’ll then examine the implications for advisors whose clients own funds, ETFs or REITs that own that debt.

Grade Yourself on August’s Moment of Truth

by Dan Richards

Moments of truth occur when clients make judgments about their advisors. Exactly such a moment came in mid-August as clients read alarming headlines about “plunging markets” and “market routs.” Here’s a way to assess how you handled that moment.

Vinson Walden on the Thornburg Global Opportunities Fund

by Robert Huebscher

Vinson Walden is the co-portfolio manager, along with Brian McMahon, of the Thornburg Global Opportunities Fund (THOAX). Within Morningstar’s World Stock category, THOAX ranked among the top-performing funds over the last one, three and five years. I spoke with Vin about how he constructs the fund and his outlook for the future.

How to Handle an Initial Inquiry from a Prospect

by Dan Solin

Here’s a jaw-dropping case of how two attorneys failed when I made an initial inquiry, followed by my recommendations for how advisors should handle similar situations.

Career Center

by Various

Find career opportunities for firms that seek to add financial advisors and planners to their staff. Read more to find out how to post opportunities at your firm.

Dealing with Quirky Markets and Nervous Clients

by Beverly Flaxington

Unsettled markets are creating unsettled clients. We are being proactive, but I wonder whether being proactive tells clients that there is a problem. We can’t say, “There is nothing to worry about” without creating a concern that there IS in fact something to worry about.

Do John Hancock Funds Add Value for Investors?

by Larry Swedroe

John Hancock ranked second on Barron’s annual list of best-performing mutual fund families for the latest 10-year period. How did its performance compare to that of two popular passively managed fund companies?

The Use and Abuse of Dividend Strategies

by Robert J. Martorana

I will look at the underlying justification for a dividend-based strategy and at how the most popular funds have performed recently. I will then discuss the criteria that investors should use to construct the best dividend-oriented portfolio, and which mutual fund best meets those criteria.

How an “Abundance Mentality” Drives Top Advisors

by Dan Richards

Hard work, talent and luck drive top advisors. But research from Wharton’s top-rated faculty member shows there’s another quality high on the list.

Recent Commentaries

Making Sense of Market Volatility

by Karen Dunn Kelley of Invesco Blog

On Aug. 21, the Dow Jones Industrial Average entered a correction, falling 10% from its most recent peak, and reminded investors what volatility looks like after almost four correction-free years. While volatility exposes weaknesses in the market, in my opinion it also reveals the strength of high conviction managers who are skillfully navigating the market. Active management and smart beta strategies seek to surpass the “market averages” offered by traditional benchmarks, providing the potential not only for higher returns, but also for a smoother ride.

If You Need to Reduce Risk, Do it Now

by John P. Hussman of Hussman Funds

The single most important thing for investors to understand here is how current market conditions differ from those that existed through the majority of the market advance of recent years. The difference isn’t valuations. On measures that are best correlated with actual subsequent 10-year S&P 500 total returns, the market has advanced from strenuous, to extreme, to obscene overvaluation, largely without consequence. The difference is that investor risk-preferences have shifted from risk-seeking to risk-aversion.

On My Radar: We Didn’t Start The Fire

by Steve Blumenthal of CMG Capital Management Group

Risk is high. For equity exposure, hedge or raise cash on rallies and let your tactical and alternative strategies follow their processes. Put in place the processes. Now is the time.

Dog Days Are Over: What a Week!

by Liz Ann Sonders of Charles Schwab

Volatility … and the volatility of volatility … hit record levels last week. We believe this is just a correction; not the beginning of a new bear market. Weeks like last week provide valuable lessons for investors about crowd psychology and the benefits of diversification and rebalancing.

Markets Volatile, Economy Fine

by Brian S. Wesbury and Robert Stein of First Trust Advisors

As you woke up this morning, US stock market futures were down again. They say it’s because the Chinese stock market fell, and in spite of this every summary of Fed intentions that we read suggests a rate hike this year (possibly in September) is still very much on the table.

Tracking the Market with Social Media

by Blair Jensen of Trade Followers

Over the past several weeks I’ve been chronicling the change in sentiment on the Twitter stream as it lead the market lower. In early July sentiment turned from bullish to neutral. By the end of the month sentiment had clearly turned bearish evidenced by both momentum and the rise in the number of bearish stocks. As the market traded sideways in early August sentiment continued to show mostly bearish readings then made an attempt to rise back above zero. That attempt failed and we watched the S&P 500 Index (SPX) fall hard as market participants panicked.

Managed Futures - Describing Liquid Alts

by Michael Breitenbach of Larkin Point Investment Advisors LLC

Managed futures strategies date back several decades to the emergence of commodity trading advisors, which were first formally defined as a structure by the Commodity Futures Trading Commission Act of 1974 (CFTC). This type of strategy is also often offered through commodity pool operator vehicles, which are a similar and inter-related designation also primarily regulated by the CFTC.

Stay Calm and Carry On

by Kenneth Kim of EQIS Capital

As most everyone is aware, the markets have been highly volatile, and mostly down, during these past few days. Everyone seems to be pointing fingers at China’s slowing economy as the cause. Before joining EQIS, I was a professor of finance at Renmin University in Beijing, China for many years. Recognized as one of the top 15 economists* in China, and a frequent economic commentator on the Chinese economy on China’s only English-language national television station, I can speak about, and address, this current market condition that places blame on China.

Weekly Market Summary

by Urban Carmel of The Fat Pitch

Waterfall events like the current one tend to most often reverberate into the weeks ahead. Indices will often jump 10% or more higher and also attempt to retest the lows. Volatility will likely remain elevated for several months. But the fall in equity prices, which has knocked investor sentiment to its knees, opens up an attractive risk/reward opportunity for investors. Further weakness, which is quite possible, is an opportunity to accumulate with an eye toward year-end. However, a quick, uncorrected rally in the next week or two would likely fail.

Recent dshort Posts

Moving Averages: August Month-End Update

Valid until the market close on August 31, 2015

The S&P 500 closed August with a monthly loss of 6.26%. All three S&P 500 MAs and three of the five Ivy Portfolio ETF MAs are signaling "Cash". In the table, monthly closes that are within 2% of a signal are highlighted in yellow.

Weekly Gasoline Price Update: Regular and Premium Down Again, WTIC Rebounds

It's time again for our weekly gasoline update based on data from the Energy Information Administration (EIA). The price of Regular and Premium went up by thirteen and eleven cents respectively. WTIC rebounded from last week to $48.54. According to, Alaska has the highest average price for Regular at $3.36 and Los Angeles is averaging $3.55. South Carolina has the cheapest at $2.00.

Dallas Fed Manufacturing Outlook Deteriorates

This morning we got the most recent Dallas Fed Manufacturing Outlook. The latest index came in at -15.8, an 11 point drop from last month's -4.6. The forecast was for a reading of -2.5.

The Big Four Economic Indicators: Real Personal Income for July

Personal Income (excluding Transfer Receipts) in July rose 0.43% and is up 4.1% year-over-year. When we adjust for inflation using the BEA's PCE Price Index, Real Personal Income (excluding Transfer Receipts) rose 0.35%. The real number is up 3.79% year-over-year. Real PI less TR is one of those indicators that warrants adjustment for population growth to understand the long-term trends.

World Markets Weekend Update: The Global Selloff Decelerates

Four of the eight indexes on our world watch finished in the red this week, an improvement over the previous when all eight posted substantial losses. However, the skew remains negative, with the average of the eight at -1.49%. Note also that we had an East-West divide, with the four advances in the Western indexes and the four declines in the East. Germany's DAX was the top performer, with a respectable 1.72% gain. China's Shanghai Composite posted another dismal week, down 7.85%.

S&P 500 Snapshot: The Rebound Stalls

Before the market opened, the Shanghai Composite posted another big gain, up 4.82%, but the European indexes would close fractionally above the flat line (the Euro STOXX 50 up only 0.18%). Our benchmark S&P 500 followed the European exemplar, struggling throughout the day in a narrow range around (mostly below) the opening price. The index ended the day with a rally in the final minutes to eke out a tiny gain of 0.06%, ending a volatile week with a gain of 0.91%.

Moving Averages: Month-End Preview

Here is an advance preview of the monthly moving averages we track after the close of the last business day of the month. At this point, before the open on the last day of the month, all three S&P 500 strategies are signaling "cash" -- changed from last month's all "invested" signal. Four of the five Ivy Portfolio ETFs - Vanguard REIT Index ETF (VNQ), PowerShares DB Commodity Index Tracking (DBC), and Vanguard FTSE All-World ex-US ETF (VEU), and Vanguard Total Stock Market ETF (VTI) - are signaling "cash", similar to last month's quadruple cash signal (IEF, VNQ, DBC, VEU).