The Fed-induced selloff in technology stocks has traders dusting off their turmoil playbooks. Trouble is, one of the most popular strategies isn’t working: hiding out in Apple Inc.
A financial crisis, following the 5.50% hike in Fed funds and similar increases in all bond yields, is virtually inevitable.
Private infrastructure offers unique investment characteristics and potential diversification benefits for portfolio construction.
In many ways, 2023 continues to be the mirror image of 2022, with the most volatile assets being some of the best performers for much of the year.
Rising interest rates are giving sellers an opportunity to broaden their opportunity set.
His approach to investing was both timeless and accessible to the average investor. It also achieved incredible results.
Stock-market strategists who were largely wrong about this year’s rally are finally starting to come to face their mistake, raising year-end targets for the S&P 500 Index.
If someone’s good enough to regularly trounce the market, they don’t want your money.
That’s a bold prediction in the title. I believe it will come true.
News that a Washington DC Court of Appeals ruled in favor of Grayscale Investments LLC over the Securities and Exchange Commission has ignited hope that a Bitcoin exchange-traded fund will soon be available. Bitcoin prices jumped.
Like Samuel Beckett’s titular character Godot, we are still waiting the all-but-certain U.S. recession. It may yet happen, but it’s wise to understand why forecasters were so grossly incorrect.
Monetary and fiscal policy are typically thought of as independent tools that central banks and governments use to manage the economy.
As businesses worldwide adopt technology, the innovation of AI may result in market leadership changes, global economic growth, and investor opportunities.
Equity markets have rallied since October, but the Franklin Templeton Investment Solutions team thinks markets have run ahead of both current and expected growth. Learn why—and what it may mean for investors.
Investors willing and able to accept the illiquidity risk of CLOs should consider them as alternatives with attractive risk/reward characteristics.
Climate change presents a significant source of transition risk for investors as companies face increasing pressures from regulators, consumers, and shareholders to lower their carbon footprints.
After the disruptions of the past few years, many of us are looking for a return to normal. For investors in emerging-market bonds, normal would mean a world in which global inflation is in check, interest rates are no longer rising, China is healthy, and traditional asset correlations resume.
The A.I. chase is making for a very narrow market.
Last week the VettaFi Voices gathered to reflect on a year at VettaFi under the firm’s new name. The team celebrated wins, and time spent together, and shared their favorite insights and highlights from a busy twelve months.
The semiconductor cycle is dead, long live the super cycle!
Stocks are having a great year, but gold is doing even better. Year-to-date global equities are up roughly 9% in dollar terms; gold has advanced more than 10%.
Fear of missing out, or “FOMO,” seems to be a common trend with investors. Whether it was GameStop, AMC, Bitcoin, or the FAANGs, the last few years has seen some investors exhibit FOMO as they chase the hottest trends in the market.
Over the past year, the municipal bond market has seen increased volatility stemming from rising interest rates across the yield curve.
Here’s how we can improve financial planning projections to result in better forecasts, advice and guidance to households.
Many advisors want to write or have an idea for a book stuck between their ears. They’re waiting for the time and inspiration to get it down on paper. So let me tell you a secret.
2023 has already been an eventful year, featuring a banking crisis and more Fed rate hikes. In our view, this is not a “set it and forget it” type of market – investors need to stay vigilant.
Inflation regimes often coincide with changing political regimes and agendas, much of which stems from the rise of populism and fiscal dominance. As a result of decades of globalisation and rising wealth inequality, we may well be entering a new regime - one of higher inflation and higher inflation volatility.
The economic signals and a host of geopolitical risks confronting investors suggest that 2023 could be as challenging as 20022 for both stocks and bonds.
Following this week’s banking crisis and the return of government bailouts, investors and traders alike are once again calling for a Fed pivot.
Vanguard Group Inc.’s first new exchange-traded fund in two years is setting sail at a turbulent time for municipal debt.
The long-term outlook for stocks remains questionable, as most of my leading indicators of risk assets suggest sub-par performance over the next year or so.
Markets are unpredictable, which is one of many reasons it is difficult to consistently deliver alpha over long periods. In their latest commentary, our small cap growth team explains why their approach to managing the trade-off between risk and reward gives them the opportunity to outperform across market cycles.
The United States must grasp the opportunity that the money revolution has made possible by undertaking a government-financed investment program in 21st century industries and technologies on such a large scale that it would be certain to succeed.
Now is not the time to consider changing inflation targets.
Over the long-term, the fundamentals of the dollar suggest a downward bias is likely.
Private credit can be an attractive asset that has provided high yield and protection against the risks of rising inflation. In addition, the asset class has a strong credit history – specifically senior, secured, sponsored debt.
Monetary policy is more like the World Cup than it is like mathematics or great literature.
In his latest memo, Howard Marks writes that the investment world may be experiencing the third major sea change of the last 50 years. Events in recent years – especially the spike in inflation and the Federal Reserve’s response – appear to have caused a reversal of the market conditions that prevailed after the Global Financial Crisis and for much of the last four decades. Howard discusses what this potentially new era could mean for lenders, especially bargain hunters.
“95 years ago, your crystal ball reveals: Russian debt default, LTCM fail, DotCom implosion, 9/11 attacks, financial crisis and great recession, pandemic killing millions, 3 market crashes. Would you put your money into stocks? No? You missed a 10X return.”
I explore some of the factors driving the superiority of PLIBs, in particular lapsation, mortality experience differences, accessing the equity risk premium, and the marginal role of annuities as part of a retirement strategy.
A matter that can have large impacts on the marginal tax rates faced by individuals who obtain health insurance coverage through the ACA exchanges is the reduction of the tax credits (or subsidies) for health insurance coverage as incomes increase.
One of the trends in financial innovation over the past decade has been interval and tender-offer funds.
This year's brutal market has investors across asset classes and international markets running for the exits. But where there’s panic and wreckage, there’s also arbitrage and opportunity.
Compared to the dotcom and great financial crisis recessions, our fiscal and monetary response over the last two years has been far more aggressive. But the true cost – in terms of inflation – presents a more threatening risk.
There is one and only one S&P 500 sector that is up massively this year.
Howard Marks’s latest memo argues that investors seeking superior performance must have the courage to depart from the pack, even though doing so means accepting the risk of being wrong. Thinking differently and better than others is key to outperformance, he explains, because in investing, it’s not enough to be right.
The trolley car problem is a well-known ethical question that forces one to choose between two poor consequences. For the Fed, it is whether to allow inflation to fester or to force the economy into a recession.
Will the plight of consumers drag GDP lower in the second quarter, resulting in a recession?
In January Goldman Sachs projected that the FOMC would increase the federal funds rate at every other meeting (each meeting is 6 weeks apart) starting with the March meeting.
Diverse opportunities in Global Convertibles, as well as structural features, provide tailwinds to counter rising rates and equity volatility. In rising rate environments, convertibles have historically done quite well relative to longer-duration traditional fixed income investments.
Exchange-Traded Funds (ETFs) holding only Russian equities have had creations suspended and trading halted since the war in Ukraine commenced.
This year, the theme for International Women's Day is #BreakTheBias. This theme celebrates the achievements that women have made, takes action for equality, and raises awareness against bias. What better way to honor the holiday than to examine how women are breaking down barriers in the financial services industry?
Markets have already reacted to the threat of a Russian invasion of Ukraine in a textbook manner akin to prior similar events that we have outlined in prior articles on January 31 and February 22.
I propose a strategy that can produce larger price gains or losses than bonds and higher yields than traditional bond funds or ETFs. If yields decline soon, investors can expect double-digit returns in a relatively short period.
Howard Marks’s latest memo considers one of investing’s most fundamental questions: when to sell. Howard explains that it’s foolish to sell because prices are up and because they’re down – and why, most of the time, staying invested is ultimately “the most important thing.”
We hope you enjoy the latest newsletter from Harold Evensky.
The best marketing doesn’t just attract people to your business. It also repels the people you don’t want to work with.
The fund is rated 5 stars in the Small Cap Growth category for the 5-Year, 3-Year, & Overall Periods. As of November 30, 2021, the fund was rated against 507 small cap growth funds in the 5-year category and 574 funds in the 3-year and overall categories, based on total returns.
Historically, fourth quarter tax loss selling of closed-end funds (“CEFs”) has been prevalent in the market. CEFs may be more susceptible to tax loss selling given they trade on a stock exchange and market prices (investor return) can deviate from underlying net asset values (“NAVs”) (fund return).
For life settlements, open-ended funds offer more liquidity than closed-end funds, but they also have lower returns and the management and performance fees are often based on the net asset value of the fund – which can be hard to accurately assess for assets with unlevel cashflows.
The S&P 500 index is up more than 20% so far this year, but more than 90% of its member stocks have had “correction” level drawdowns—more than 10% from a peak—at some point this year. In short, while overall stock market performance has been strong, there has been a lot of churn beneath the surface.
The justification for the 4% rule was based upon historical investment performance from 1925 to 1995. But what is the value of relying on those results when today’s economy is so different?
In case there was any uncertainty about the moral hazard created by the Federal Reserve’s decision to buy junk-bond exchange-traded funds, a group of former senior leaders at BlackRock Inc., JPMorgan Asset Management and HSBC is leaving no room for doubt.
Here are a few ways that advisors can show their clients that they care this holiday season.
The four emotions that I encounter in client interactions are fear, guilt, shame and envy. By anticipating and learning how to address them, we can tailor solutions to each client.
Here are five cost-effective strategies advisors should use to reach Millennials:
There are many potential advantages to investing in tax-exempt municipal bonds, but not all advisors are aware of additional strategies and investment vehicles that can help them meet muni-focused client needs.
Choosing a fund or ETF with a positive ESG profile is fraught with risk. New research shows how carefully investors must weigh considerations such as screening criteria, factor exposures, industry concentration and expenses.
TINA has been applied to investing. You must buy stocks because TINA. You can’t make money any other way. Just close your eyes, buy and hold forever. Or at least through a full market cycle. Frankly, I think that’s stupid.
Growth stocks have lagged cyclicals so far in 2021, but we remain steadfast in our belief that secular growth is the key to generating long-term returns. In this piece, we discuss how we find attractive opportunities in the small cap universe.
Treasury yields fell again in May and credit spreads approached recent tights as the virus continued to recede, allowing the reopening of the economy to progress. Economic data was noisy this month, largely due to base effects, but confirms the ongoing trend of renewed growth and signs of inflation.
Transitory is defined as being of brief duration, tending to pass away and not persistent
Trust is a precious commodity.
In a complete reversal from what was expected roughly a year ago, the outlook for muni issuers is much brighter.
High-profile episodes, such as that involving GameStop, have led some to advocate for banning short selling. But new research confirms that short sellers play a valuable role in keeping markets efficient and preventing prices from overshooting their intrinsic value.
In recent months, two investment themes have been rewarding investors with outperformance: defense sector companies and those participating in share buybacks.
This is the fourth part in a series about my late partner, Emery Kertesz. I’ve summarized his management principles. They have broad applicability
A flexible bond strategy can deliver strong performance with low volatility by diversifying across global markets.
Covered call strategies can help investors manage short-term volatility and may provide better long-term outcomes while seeking to provide attractive monthly income to investors.
Treasury yields rocketed higher in February, with the move again concentrated in longer maturities. Volatility spiked as liquidity dried up in the Treasury market, especially after a very weak 7-year auction that briefly pushed 10-year Treasury yields to 1.60%. The news flow was largely the same direction: an improving economy, increased vaccine rollout with deaths and hospitalizations turning sharply lower, and a continued march toward a substantial fiscal stimulus plan.
The main fund from Cathie Wood’s Ark Investment Management slipped in pre-market trading on Thursday, as it struggles to stabilize following a 20% drop from its February peak.
Those of us in the coaching business may be doing some harm, notwithstanding our good intentions.
Rob Arnott: “There hasn’t been a better time to be a value investor at any other time in my career. I look back at the tech bubble and I never thought I would see valuations stretched the way they were then. We're back to that, and then some." We invite you to revisit “Reports of Value’s Death Have Been Greatly Exaggerated” now published in the Financial Analysts Journal.
Hope is high that economic growth will accelerate as more people are vaccinated against COVID-19, but so far economic data has been lackluster. Meanwhile, bond investors are expecting inflation despite signs that the economic recovery’s momentum may be stalling. Why does everything seem so disconnected?
Treasury yields continued to march higher in January, with the move again concentrated in longer maturities. Mortgage spreads tightened slightly, while corporate bond spreads were mostly mixed. The market remains stuck between the push/pull of the prospect for greater fiscal stimulus and ongoing vaccine rollout versus continued lockdowns and the greatest one-month mortality rate since the pandemic began nearly a year ago.
Internet message boards are lighting up and certain stocks have seen some unusually dramatic price moves. David Mann, our Head of Global Exchange Traded Funds (ETFs) Capital Markets, ponders whether ETFs could be subject to similar volatility.
Inflation will likely heat up in the coming months, but not to worrying levels.
In my third and last article in this series, I identify the two most powerful steps I’d like to see advisors take to get more clients.
Closed End Funds
Megacap Slump Is Testing Apple’s Safe-Haven Status
The Fed-induced selloff in technology stocks has traders dusting off their turmoil playbooks. Trouble is, one of the most popular strategies isn’t working: hiding out in Apple Inc.
The Looming Crisis: Who Is Swimming Naked?
A financial crisis, following the 5.50% hike in Fed funds and similar increases in all bond yields, is virtually inevitable.
Unlisted Infrastructure – Highway to Diversification
Private infrastructure offers unique investment characteristics and potential diversification benefits for portfolio construction.
As the Economy Slows, Favor Consistency Over Volatility
In many ways, 2023 continues to be the mirror image of 2022, with the most volatile assets being some of the best performers for much of the year.
Seller Financing of Real Estate is Back
Rising interest rates are giving sellers an opportunity to broaden their opportunity set.
The Greatest Investor You’ve Never Heard Of
His approach to investing was both timeless and accessible to the average investor. It also achieved incredible results.
Wall Street Comes to Grips With How Wrong It’s Been in 2023
Stock-market strategists who were largely wrong about this year’s rally are finally starting to come to face their mistake, raising year-end targets for the S&P 500 Index.
But, But, What about Buffett and Lynch?
If someone’s good enough to regularly trounce the market, they don’t want your money.
The Fed Will Cut Rates in 2024
That’s a bold prediction in the title. I believe it will come true.
Grayscale’s Bitcoin Win Is Still Only Half the Battle
News that a Washington DC Court of Appeals ruled in favor of Grayscale Investments LLC over the Securities and Exchange Commission has ignited hope that a Bitcoin exchange-traded fund will soon be available. Bitcoin prices jumped.
The “Godot” Recession
Like Samuel Beckett’s titular character Godot, we are still waiting the all-but-certain U.S. recession. It may yet happen, but it’s wise to understand why forecasters were so grossly incorrect.
Fiscal-Monetary Entanglement
Monetary and fiscal policy are typically thought of as independent tools that central banks and governments use to manage the economy.
Investing in Artificial Intelligence (AI)
As businesses worldwide adopt technology, the innovation of AI may result in market leadership changes, global economic growth, and investor opportunities.
Running of the Bulls
Equity markets have rallied since October, but the Franklin Templeton Investment Solutions team thinks markets have run ahead of both current and expected growth. Learn why—and what it may mean for investors.
The Opportunity in CLO Investments
Investors willing and able to accept the illiquidity risk of CLOs should consider them as alternatives with attractive risk/reward characteristics.
Estimating Value Chain Emissions for Portfolio Construction
Climate change presents a significant source of transition risk for investors as companies face increasing pressures from regulators, consumers, and shareholders to lower their carbon footprints.
Return to Normal? Surveying the Landscape for Emerging-Market Bonds
After the disruptions of the past few years, many of us are looking for a return to normal. For investors in emerging-market bonds, normal would mean a world in which global inflation is in check, interest rates are no longer rising, China is healthy, and traditional asset correlations resume.
A.I., Narrow Markets, And The New T.I.N.A.
The A.I. chase is making for a very narrow market.
VettaFi Voices On: One Year as VettaFi
Last week the VettaFi Voices gathered to reflect on a year at VettaFi under the firm’s new name. The team celebrated wins, and time spent together, and shared their favorite insights and highlights from a busy twelve months.
Live at the Sub-ICs
The semiconductor cycle is dead, long live the super cycle!
An End To Tightening Supports Gold
Stocks are having a great year, but gold is doing even better. Year-to-date global equities are up roughly 9% in dollar terms; gold has advanced more than 10%.
Quality Control
Fear of missing out, or “FOMO,” seems to be a common trend with investors. Whether it was GameStop, AMC, Bitcoin, or the FAANGs, the last few years has seen some investors exhibit FOMO as they chase the hottest trends in the market.
Municipal Closed-End Funds: Near Term Pain, Long-Term Gain?
Over the past year, the municipal bond market has seen increased volatility stemming from rising interest rates across the yield curve.
The Problems with Monte Carlo are in Your Mind
Here’s how we can improve financial planning projections to result in better forecasts, advice and guidance to households.
Four Steps to Get That Book Out of Your Head
Many advisors want to write or have an idea for a book stuck between their ears. They’re waiting for the time and inspiration to get it down on paper. So let me tell you a secret.
Strategic Income Outlook: And We Thought 2022 Was a Crazy Year
2023 has already been an eventful year, featuring a banking crisis and more Fed rate hikes. In our view, this is not a “set it and forget it” type of market – investors need to stay vigilant.
The Case For Secular Inflation
Inflation regimes often coincide with changing political regimes and agendas, much of which stems from the rise of populism and fiscal dominance. As a result of decades of globalisation and rising wealth inequality, we may well be entering a new regime - one of higher inflation and higher inflation volatility.
First Quarter 2023 Economic Review and Forecast
The economic signals and a host of geopolitical risks confronting investors suggest that 2023 could be as challenging as 20022 for both stocks and bonds.
Don’t Expect a Fed Pivot Just Yet
Following this week’s banking crisis and the return of government bailouts, investors and traders alike are once again calling for a Fed pivot.
Vanguard’s First New ETF in Two Years Targets Short-Term Munis
Vanguard Group Inc.’s first new exchange-traded fund in two years is setting sail at a turbulent time for municipal debt.
Is Now The Time To Buy Stocks?
The long-term outlook for stocks remains questionable, as most of my leading indicators of risk assets suggest sub-par performance over the next year or so.
Is Now The Time To Buy Stocks?
The long-term outlook for stocks remains questionable, as most of my leading indicators of risk assets suggest sub-par performance over the next year or so.
Small Cap Growth Investing Across Market Cycles
Markets are unpredictable, which is one of many reasons it is difficult to consistently deliver alpha over long periods. In their latest commentary, our small cap growth team explains why their approach to managing the trade-off between risk and reward gives them the opportunity to outperform across market cycles.
America Must Invest
The United States must grasp the opportunity that the money revolution has made possible by undertaking a government-financed investment program in 21st century industries and technologies on such a large scale that it would be certain to succeed.
Are Inflation Targets Still On Point?
Now is not the time to consider changing inflation targets.
Are Inflation Targets Still On Point?
Now is not the time to consider changing inflation targets.
The Dollar Will Weaken, But Not Yet
Over the long-term, the fundamentals of the dollar suggest a downward bias is likely.
Private Debt Funds Offer Attractive Yield
Private credit can be an attractive asset that has provided high yield and protection against the risks of rising inflation. In addition, the asset class has a strong credit history – specifically senior, secured, sponsored debt.
For the Fed, a Red Card From the Seventies
Monetary policy is more like the World Cup than it is like mathematics or great literature.
Sea Change
In his latest memo, Howard Marks writes that the investment world may be experiencing the third major sea change of the last 50 years. Events in recent years – especially the spike in inflation and the Federal Reserve’s response – appear to have caused a reversal of the market conditions that prevailed after the Global Financial Crisis and for much of the last four decades. Howard discusses what this potentially new era could mean for lenders, especially bargain hunters.
Newsletter Volume 15, No. 5
“95 years ago, your crystal ball reveals: Russian debt default, LTCM fail, DotCom implosion, 9/11 attacks, financial crisis and great recession, pandemic killing millions, 3 market crashes. Would you put your money into stocks? No? You missed a 10X return.”
The Drivers of the Efficiency of Protected Lifetime Income Benefit (PLIB) Strategies: Part 3
I explore some of the factors driving the superiority of PLIBs, in particular lapsation, mortality experience differences, accessing the equity risk premium, and the marginal role of annuities as part of a retirement strategy.
Tax Planning and Health Insurance Premium Subsidies under the Affordable Care Act
A matter that can have large impacts on the marginal tax rates faced by individuals who obtain health insurance coverage through the ACA exchanges is the reduction of the tax credits (or subsidies) for health insurance coverage as incomes increase.
The Growth and Appeal of "Semi-liquid" Funds
One of the trends in financial innovation over the past decade has been interval and tender-offer funds.
Investment Trusts Are Trading at The Biggest Discounts In More Than a Decade
This year's brutal market has investors across asset classes and international markets running for the exits. But where there’s panic and wreckage, there’s also arbitrage and opportunity.
The Price the U.S. Will Pay for Faster Recovery
Compared to the dotcom and great financial crisis recessions, our fiscal and monetary response over the last two years has been far more aggressive. But the true cost – in terms of inflation – presents a more threatening risk.
The Midstream: Pipelines to Prosperity
There is one and only one S&P 500 sector that is up massively this year.
I Beg to Differ
Howard Marks’s latest memo argues that investors seeking superior performance must have the courage to depart from the pack, even though doing so means accepting the risk of being wrong. Thinking differently and better than others is key to outperformance, he explains, because in investing, it’s not enough to be right.
The Trolley Car Problem – The Fed's Predicament
The trolley car problem is a well-known ethical question that forces one to choose between two poor consequences. For the Fed, it is whether to allow inflation to fester or to force the economy into a recession.
Consumer Weakness Signals a Recession
Will the plight of consumers drag GDP lower in the second quarter, resulting in a recession?
FOMC Inflation Test Coming
In January Goldman Sachs projected that the FOMC would increase the federal funds rate at every other meeting (each meeting is 6 weeks apart) starting with the March meeting.
Global Convertible Market Update: Portfolio Manager Q&A
Diverse opportunities in Global Convertibles, as well as structural features, provide tailwinds to counter rising rates and equity volatility. In rising rate environments, convertibles have historically done quite well relative to longer-duration traditional fixed income investments.
Clearing the Inbox: ETFs that Hold Only Russian Equities
Exchange-Traded Funds (ETFs) holding only Russian equities have had creations suspended and trading halted since the war in Ukraine commenced.
Female Financial Advisors: Breaking Biases and Barriers
This year, the theme for International Women's Day is #BreakTheBias. This theme celebrates the achievements that women have made, takes action for equality, and raises awareness against bias. What better way to honor the holiday than to examine how women are breaking down barriers in the financial services industry?
Schwab’s Quick Take: Russia Invades Ukraine
Markets have already reacted to the threat of a Russian invasion of Ukraine in a textbook manner akin to prior similar events that we have outlined in prior articles on January 31 and February 22.
The Strategy for a Bull Market in Bonds
I propose a strategy that can produce larger price gains or losses than bonds and higher yields than traditional bond funds or ETFs. If yields decline soon, investors can expect double-digit returns in a relatively short period.
Selling Out
Howard Marks’s latest memo considers one of investing’s most fundamental questions: when to sell. Howard explains that it’s foolish to sell because prices are up and because they’re down – and why, most of the time, staying invested is ultimately “the most important thing.”
NewsLetter - December 2021
We hope you enjoy the latest newsletter from Harold Evensky.
How to Repel the Wrong People from Your Company
The best marketing doesn’t just attract people to your business. It also repels the people you don’t want to work with.
Press Release: Osterweis Emerging Opportunity Fund Receives Five-Star Five-Year Morningstar Rating
The fund is rated 5 stars in the Small Cap Growth category for the 5-Year, 3-Year, & Overall Periods. As of November 30, 2021, the fund was rated against 507 small cap growth funds in the 5-year category and 574 funds in the 3-year and overall categories, based on total returns.
Finding Opportunities in the Closed-End Fund Market
Historically, fourth quarter tax loss selling of closed-end funds (“CEFs”) has been prevalent in the market. CEFs may be more susceptible to tax loss selling given they trade on a stock exchange and market prices (investor return) can deviate from underlying net asset values (“NAVs”) (fund return).
The Problem with Open-Ended Life-Settlement Funds
For life settlements, open-ended funds offer more liquidity than closed-end funds, but they also have lower returns and the management and performance fees are often based on the net asset value of the fund – which can be hard to accurately assess for assets with unlevel cashflows.
2022 Schwab Market Outlook: Ebb Tide
The S&P 500 index is up more than 20% so far this year, but more than 90% of its member stocks have had “correction” level drawdowns—more than 10% from a peak—at some point this year. In short, while overall stock market performance has been strong, there has been a lot of churn beneath the surface.
There is No “Safe Withdrawal Rate”
The justification for the 4% rule was based upon historical investment performance from 1925 to 1995. But what is the value of relying on those results when today’s economy is so different?
New Junk-Bond ETFs Are Born of Fed Moral Hazard: Brian Chappatta
In case there was any uncertainty about the moral hazard created by the Federal Reserve’s decision to buy junk-bond exchange-traded funds, a group of former senior leaders at BlackRock Inc., JPMorgan Asset Management and HSBC is leaving no room for doubt.
Creative Holiday Marketing Ideas
Here are a few ways that advisors can show their clients that they care this holiday season.
The Four Drivers of Client Emotions
The four emotions that I encounter in client interactions are fear, guilt, shame and envy. By anticipating and learning how to address them, we can tailor solutions to each client.
Five Cost-Effective Strategies to Reach Millennials
Here are five cost-effective strategies advisors should use to reach Millennials:
How SMAs and Interval Funds Can Help Meet Municipal Investor Needs
There are many potential advantages to investing in tax-exempt municipal bonds, but not all advisors are aware of additional strategies and investment vehicles that can help them meet muni-focused client needs.
Why It’s So Hard to Choose ESG Funds and ETFs
Choosing a fund or ETF with a positive ESG profile is fraught with risk. New research shows how carefully investors must weigh considerations such as screening criteria, factor exposures, industry concentration and expenses.
TINA Is Stupid
TINA has been applied to investing. You must buy stocks because TINA. You can’t make money any other way. Just close your eyes, buy and hold forever. Or at least through a full market cycle. Frankly, I think that’s stupid.
Why Secular Growth Matters, and How We Find It
Growth stocks have lagged cyclicals so far in 2021, but we remain steadfast in our belief that secular growth is the key to generating long-term returns. In this piece, we discuss how we find attractive opportunities in the small cap universe.
Total Return Perspectives: May 2021
Treasury yields fell again in May and credit spreads approached recent tights as the virus continued to recede, allowing the reopening of the economy to progress. Economic data was noisy this month, largely due to base effects, but confirms the ongoing trend of renewed growth and signs of inflation.
Transitory Inflation? Not so Quick
Transitory is defined as being of brief duration, tending to pass away and not persistent
Vaccines and the West’s Credibility Crisis
Trust is a precious commodity.
Game Changer: How the American Rescue Plan Improved the Outlook for Munis
In a complete reversal from what was expected roughly a year ago, the outlook for muni issuers is much brighter.
Short Selling Keeps Markets Efficient
High-profile episodes, such as that involving GameStop, have led some to advocate for banning short selling. But new research confirms that short sellers play a valuable role in keeping markets efficient and preventing prices from overshooting their intrinsic value.
What’s Working? Two Ideas For Investors
In recent months, two investment themes have been rewarding investors with outperformance: defense sector companies and those participating in share buybacks.
Lessons for Advisors (and Life) From Emery Kertesz (Part Four)
This is the fourth part in a series about my late partner, Emery Kertesz. I’ve summarized his management principles. They have broad applicability
Strategic Income Opportunities Fund
A flexible bond strategy can deliver strong performance with low volatility by diversifying across global markets.
Making More by Losing Less
Covered call strategies can help investors manage short-term volatility and may provide better long-term outcomes while seeking to provide attractive monthly income to investors.
Total Return Perspectives: February 2021
Treasury yields rocketed higher in February, with the move again concentrated in longer maturities. Volatility spiked as liquidity dried up in the Treasury market, especially after a very weak 7-year auction that briefly pushed 10-year Treasury yields to 1.60%. The news flow was largely the same direction: an improving economy, increased vaccine rollout with deaths and hospitalizations turning sharply lower, and a continued march toward a substantial fiscal stimulus plan.
Cathie Wood’s ARKK Struggles in Early Trading After 20% Retreat
The main fund from Cathie Wood’s Ark Investment Management slipped in pre-market trading on Thursday, as it struggles to stabilize following a 20% drop from its February peak.
The Harmful Side of Coaching
Those of us in the coaching business may be doing some harm, notwithstanding our good intentions.
Reports of Value's Death May Be Greatly Exaggerated
Rob Arnott: “There hasn’t been a better time to be a value investor at any other time in my career. I look back at the tech bubble and I never thought I would see valuations stretched the way they were then. We're back to that, and then some." We invite you to revisit “Reports of Value’s Death Have Been Greatly Exaggerated” now published in the Financial Analysts Journal.
Schwab Market Perspective: Disconnection
Hope is high that economic growth will accelerate as more people are vaccinated against COVID-19, but so far economic data has been lackluster. Meanwhile, bond investors are expecting inflation despite signs that the economic recovery’s momentum may be stalling. Why does everything seem so disconnected?
Total Return Perspectives: January 2021
Treasury yields continued to march higher in January, with the move again concentrated in longer maturities. Mortgage spreads tightened slightly, while corporate bond spreads were mostly mixed. The market remains stuck between the push/pull of the prospect for greater fiscal stimulus and ongoing vaccine rollout versus continued lockdowns and the greatest one-month mortality rate since the pandemic began nearly a year ago.
ETFs, Message Boards and Volatility
Internet message boards are lighting up and certain stocks have seen some unusually dramatic price moves. David Mann, our Head of Global Exchange Traded Funds (ETFs) Capital Markets, ponders whether ETFs could be subject to similar volatility.
Some Worries May Be Inflated
Inflation will likely heat up in the coming months, but not to worrying levels.
More and Less in 2021 (Part Three)
In my third and last article in this series, I identify the two most powerful steps I’d like to see advisors take to get more clients.