The Asset Allocation Channel

Some Thoughts on 2018

2017 turned out to be a better year for the stock market than most investors surmised. For 2018, we yet again see investors avoiding one of the longest post-war bull markets in history and continuing to ignore the fundamentals driving markets higher.

Weekly Market Summary

All of the US equity indices made new all-time highs this week, for the first time since mid-October. SPX and DJIA have risen 8 months in a row. By some measures, investor sentiment is more bullish now than at any other time in more than a year, driven, apparently, by enthusiasm for tax reform legislation. The current uptrend is extended, and may be getting ready to take a short break, but further gains are likely during the first several months of 2018.

NFIB Small Business Survey: Index Near All-Time High

The latest issue of the NFIB Small Business Economic Trends came out this morning. The headline number for November came in at 107.5, up 3.7 from the previous month and near its all-time high reached in July 1983. The index is at the 99th percentile in this series. Today's number came in above the Investing.com forecast of 104.6.

Why Target-Date Funds are Out of Date

The following are some commonly asked questions and concerns I’ve heard from advisors about 401Ks, target-date funds and retirement.

The Unambiguous Tax Deferred Retirement Account

This article is in response to Kerry Pechter’s article, The Ambiguity of Tax Deferral. In contrast to the idea that there are different, but valid, ways to look at traditional tax-deferred 401(k) and IRA accounts, I show that there are right and wrong conceptual models. Wrong models lead to wrong decisions and do not explain outcomes.

The Best Strategy for Retiring Without Adequate Savings

Most research on retirement strategies assumes that people have saved adequately. But data on household savings shows that many households fall short, and will need to call on relatives or other sources for support. This raises questions about the best withdrawal or annuity strategies when savings are insufficient. It turns out that which strategy works best is different than for adequately funded retirements.

On My Radar: The Liscio Report

I met Philippa Dunne, co-editor of The Liscio Report, at the Camp Kotok fishing trip last August. She dials into state tax receipts and has many deep contacts. What I like is how she tracks the data on the lookout for recession risks. I found the most recent report excellent.

Back-tested strategies: Real or random?

Some are real. Others are random.

Will Tax Cuts (Finally) Reawaken Value?

Value stocks are cheap, relative to growth, but have lacked a catalyst to rally. Russ discusses why tax cuts could be that spark.

The Latest Look at the Total Return Roller Coaster

Here's an interesting set of charts that will especially resonate with those of us who follow economic and market cycles. Imagine that five years ago you invested $10,000 in the S&P 500. How much would it be worth today, with dividends reinvested but adjusted for inflation? The purchasing power of your investment has increased to $19,992 for an annualized real return of 13.94%.

On My Radar: It Feels Like 1999 All Over Again

Let’s start today with a look back at the major world market indexes’ performance since October 2007 (the last bull market peak) and also the performance since March 2009 panic low. A tale of two different stories. The first was expensive, leveraged and featured a Fed raising rates. The second was relatively inexpensive and the beginning of unprecedented central bank liquidity.

4 principles for investing success

Timeless ideas to guide client portfolios.

Are your clients getting enough global exposure?

Add an international component to portfolios.

Weekly Market Summary

All of the US equity indices continue to make new all-time highs. SPX and DJIA have risen 8 months in a row. The current uptrend is extended, and may be getting ready to take a short break, but further gains are likely during the first several months of 2018. December is typically the strongest month of the year for equities. But as bullish as December tends to be, an intra-month drawdown of 2% has been common, even in recent years. By some measures, investor sentiment is more bullish now than at any other time in more than a year. That could mute returns over the next month or so.

Tax Reform and the Possible Impact on Retirement

US tax reform looks to impact many areas of our lives, and one of these could be the way Americans save and invest for retirement. As we wait for Congress to refine and vote on the latest tax proposals, Drew Carrington, head of Institutional Defined Contribution at Franklin Templeton Investments, breaks down how lawmakers might target retirement dollars for tax revenue.