As short-term rates move higher and the Treasury yield curve flattens, many investors are thinking about how to earn income while also protecting themselves against rising rates. In this post, we'll discuss why municipal floating-rate notes -- an often-overlooked part of the market -- may be an attractive option for these investors.
Being wrong and admitting it, what a novel idea, yet as Bernstein states, “It helps to know that being wrong is inevitable and normal, not some terrible tragedy, not some awful failing in reasoning, not even bad luck in most instances. Being wrong comes with the franchise of an activity whose outcome depends on an unknown future.” Indeed, the real trick is to be wrong quickly for a de minimis loss of capital.
In the span of human history, retirement is a fairly new idea. Only a few generations ago, most of our ancestors could expect to work until the end of their lives. We are happy to report this is no longer the case. Improving longevity brings the opportunity for retirement, but also the responsibility for preparing. Unfortunately, many Americans have not handled this responsibility very well at all.
If the efficient markets hypothesis is questionable at the stock level, it’s more so at the index level. As the number of indices skyrockets, the number of companies declines, and passive flows grow, active price discovery becomes more and more valuable.
The Endless Summer (1966) is the crown jewel to ten years of Bruce Brown surfing documentaries. Brown follows two young surfers around the world in search of the perfect wave, and ends up finding quite a few in addition to some colorful local characters (Endless Summer).
The “dog days” of summer are ending, and September and October frequently have “re-introduced” investors to volatility. This may prove especially true as we head into what looks to be a divisive and brutal mid-term election cycle.
The U.S. government must determine how to deal with the negative consequences of some of the last decade’s most successful internet-based businesses. Alphabet, Facebook and Amazon grew up as strangers and have developed monopolies in search, social media and in e-commerce.
US stocks continue to pose big questions for investors. After nine years of strong gains, concerns about market conditions are rife. But we think US stocks are more attractive than perceived for three main reasons.
As yields increase, short-maturity bond funds can offer both higher income potential and a cushion against interest rate risk. Karen explains the mechanics, in part three of her Rising Rates series.
For Templeton and Price to execute a “new era” approach today, we believe they would likely advocate avoiding the S&P 500 Index, mutual funds and ETFs, emphasizing growth stock investing and they would be very careful with ownership of anything related to technology. Price recognized that growth eras don’t continue forever and Templeton went wherever he thought he could make great money buying companies at depressed prices with positive economics. We believe our eight criteria for common stock ownership will shepherd us through this “new era.”
Trade tensions have spooked investors in recent months, including those in India’s stock market. Franklin Templeton Emerging Markets Equity’s Sukumar Rajah weighs in on the positive economic fundamentals he and the team see, and why they think India’s equity market should be able to weather recent challenges.
Gold prices moved up close to 2 percent today, and gold stocks climbed even higher following comments from Federal Reserve Chair Jerome Powell. During his speech at the Jackson Hole Economic Symposium, Powell reiterated the central bank’s commitment to raise interest rates gradually while the U.S. economy continues its strong performance.
This memo covers three ways in which securities markets seem to be moving toward reducing the role of people: (a) index investing and other forms of passive investing, (b) quantitative and algorithmic investing, and © artificial intelligence and machine learning.
Read Harold Evensky's latest Newsletter.
We have used the “Not Afraid” story many times over the past 48 years, but we dredged it up again this morning because of the many questions about “being afraid” we got in Boston two weeks ago and New York City last week.
US equities have returned to their January all-time highs. Several new momentum studies suggest that equities are likely to gain more into year-end. Despite the gains over the past 5 months, investor sentiment is not frothy. US equities now have a topping pattern in place: the momentum high in January has been followed a price high in August.
My good friend Marc Lichtenfeld from the Oxford Club has always been savvy in following such strategies. I invite you to learn from his investment journey in this special Q&A.
Do Active Managers Provide Higher Factor Exposure than ETFs? Investors can express factor views via smart beta ETFs or mutual funds. Some mutual funds offer higher factor exposure than smart beta ETFs. Given higher fees, strong views on expected factor performance are required.
John Barr manages the Needham Aggressive Growth Fund (NEAGX), which had an annualized return of 10.51% over the prior 15 years, versus 9.42% for the S&P 500, for an outperformance of 109 basis points. In this interview, he discusses the outlook for his fund.
So, as most of you know we were on a road trip last week. We flew into Albany, New York on Sunday only to be greeted with hotter temperatures than what we left in Florida. The mountain drive to Manchester, Vermont was spectacular, but hereto the temperatures were hotter than Florida.
The number of publicly listed companies in the U.S. has fallen steadily since 1997. More companies have delisted, in fact, than gone public in every year of the past 20 years except one, 2013. Put another way, the pool is getting smaller even while the population and economy are expanding.
Most investors believe that all passively managed funds in the same asset class are virtual substitutes for one another. The result is that, when choosing a specific fund, their sole focus is on its expense ratio. That is a mistake for a wide variety of reasons. The first is that expense ratios are not a mutual fund’s only expense.
We don’t know how long ago we met Frederick “Shad” Rowe, but we are glad we did, because our conversations with him have been net worth changing.
It is no secret that the U.S. stock market has been completely addicted to discounting the future success of the most popular technology stocks. Momentum-based growth investing has had many bouts of success in the past, but this is the first episode in an era where indexed mutual funds and exchange traded funds (ETFs) were the largest aggregate owners of the largest capitalization companies.
Stock indexes have been able to move higher as the balancing act between economic growth and investor concerns continues—but how long will it last?
The decade after the financial crisis has been marked by low inflation and investment spending, lagging income growth and a strong U.S. dollar. We expect these trends to reverse direction and potentially surprise investors who aren't prepared.
A landmark study looked back at more than 100 years of data and 23 countries to determine if there are reasons to believe the cross-sectional patterns in factor returns will persist, or whether they were just anomalies that tended to disappear after publication.
“Do you have the mental fortitude to accept huge gains?” is a line from The Elliott Wave Theorist’s Robert Prechter in an era gone by. But it is as true today as it was when first penned in the 1970s. And to do that, one has to ignore the ticker and hold stocks through a long market swing.
Turkish asset prices have plummeted this year, bringing their valuations to historically low levels. That presents potentially attractive opportunities to investors looking for quality stocks at bargain-basement prices. Yet some selloffs don’t necessarily end with stocks and bonds at oversold levels if their prices largely reflect current or near-term risks, both company specific and macroeconomic.
Last week I gave you some rules to follow with your investments. They were necessarily general because I’m writing to a broad audience. Today, I will get more specific by discussing some possible strategies for high-net-worth “accredited investors.”
Meet Juan León – a key member of the U.S. Global Investors’ investment team. Juan is responsible for researching companies, sectors and industries, in addition to constructing new investment strategies for several of the firm’s mutual funds and ETFs.
Geopolitics dominates the news these days, over-shadowing what remains a fundamentally solid global economy. As always, Donald Trump is at the center of most of the “noise”...
Readers of these missives know that we have been favorable on the midstream Master Limited Partnership (MLP) space for a number of months. The reasons for that strategy have often been mentioned in these letters. First, the midstream MLPs sold off when the upstream MLPs blew up with most of them going bankrupt.
For industry veterans, annuities conjure the “bad old days” of pushy insurance companies offering rich commissions to snake-oil salesmen with Rolex-knockoffs peeking out from French cuffs.
C. Thomas Howard, PhD, is the CEO and chief investment officer at AthenaInvest, Inc., a Colorado-based investment manager. He is the co-manager of the Athena Global Tactical ETFs, a separately managed account. As of June 30, 2018, since its inception in September 2010, it has had an annualized return of 19.0%, outperforming its benchmark, the MSCI All Country World Index (ACWI) by 900 basis points. It is rated five-stars by Morningstar.
With stints at firms such as Hightower and United Capital, Todd Eklund has worked with some of the largest RIA firms. Having seen and observed some of what works and what doesn’t in the advisor space, I thought his perspective would be valuable to RIA firms considering outsourcing to a TAMP.
Anticipate before you participate in the market. This is a classic piece of advice I like to give investors and have written about extensively in my CEO blog, Frank Talk. Financial markets are influenced by relatively predictable cycles and trading patterns, and by better understanding these we are able to react thoughtfully to headline noise or unexpected market developments.
For much of this recovery and expansion, many have opined that this economic cycle would ultimately end very differently than those of the past. We have resisted this narrative and instead explained our belief that this cycle will indeed follow the same path and end like all others.
In a narrow market, pruning a growth-oriented portfolio can be challenging given market leaders’ prominence in benchmark indexes. I believe that’s why we’re seeing unusual responses to earnings announcements in 2018.
On CNBC last Friday, we stated that we have been in a stealth bull market. Indeed, after anticipating the stock market’s bottom in early February, the stealth bull market emerged.
Today’s popular stocks have literally overwhelmed the stock market in the last four years and six months. To understand today’s financial euphoria, we will analyze three terrific movies made by the actor, Jim Carrey. In Liar Liar, The Truman Show and in Bruce Almighty, we learn morals which we believe should guide us in the long-duration investment process.
On our latest “Talking Markets” podcast, we listen in on a panel of experts discussing the potential US retirement crisis and the fear factors surrounding retirement disruption.
How a fund defines its universe of small stocks eligible for purchase will make a significant difference in performance.
Yesterday’s alpha has been unbundled into market capitalization index, factors and alpha-seeking investments. What does this mean for investors? Is active dead? Of course not! But factors can enhance traditional portfolios by considering a third dimension of return.
There are large swaths of the financial planning landscape that can – and should – be both automated and integrated in such a way to which robo advisors aspire, but do not yet currently deliver.
Alternative investments (alts) were first embraced by institutions, and some people still view them as a complex solution for complex needs. However, a growing number of alternative strategies are now available via mutual funds.
Emerging market stocks are trading near bear market territory, but that’s par for the course for longer-run, rising returns.
Wall Street has ridiculed passive investing for decades. The reason is obvious: Its profits – and for many firms, their very survival – are at stake. The basic argument is that the popularity of indexing (and the broader category of passive investing) is distorting prices as fewer shares are traded by investors performing the act of “price discovery.” Let’s examine the validity of such claims.
Clearly the stock market’s “internals” are pretty perky with the NYSE Advance/Decline Line continuing to point the way higher, and in the process made yet another new all-time high last week.
Personally, I start with a base position of actively managed mutual funds, but not just any fund. The funds I want to own are the ones where I know the portfolio manager.
