It’s time again for RBA’s annual ‘Charts for the beach,’ where we highlight what consensus is currently missing.
Investing based on headlines and political promises is rarely beneficial to one’s portfolio. It’s dispassionately investing for fundamentals that continue to drive the markets.
Many investors seem to be stuck in the middle of the false dichotomy between active and passive investing. At RBA, we argue it’s much more important for investors to ascertain which active or passive portfolio to buy and when to own it.
Political rhetoric may make it seem that the end is nigh, however, it’s fundamentals, not fear that will benefit your portfolio.
Many investors believe that November 8th was the catalyst for recent market performance, however, fundamentals began improving much earlier. Remember, it’s profits, not politics that matters.
Historical studies show individual investors are very poor asset allocators, and are undoubtedly no better at selecting ETFs. At RBA, our Pactive® Management portfolios combine the benefits of low-fee, transparent and liquid passive investments with RBA’s asset allocation expertise.
ETFs continue to play a highly disruptive role in money management. RBA has embraced this trend by employing what we refer to as Pactive™ Management, which is the active allocation, whether strategic or tactical, of passive investment instruments such as ETFs, stock baskets, and index funds. These Pactive™ portfolios have quickly become the fastest growing part of our business.
While many investors ascribe recent market performance solely to a post-election surprise, we argue that there’s a simpler explanation. Remember, it’s checkers not chess.
2017 is all about inflation. As many investors hold onto the notion of “lower for longer”, we recognize that re-inflation will likely take hold in the New Year and those positioned for an improving global economy will benefit.
Fears of a repeat 2008 bear market are causing many investors to remain wallflowers during the second longest bull market of the post-war period. We argue, this fear is unfounded and the opportunity cost of avoiding equities keeps growing and growing.