With the growth in 401(k) plans and the contraction of private pensions over the last 30 years, risks in retirement have slowly and almost imperceptibly transferred from institutions to individuals. Institutions staffed with actuaries and analysts are well suited to manage those risks. Individual investors may need some help.
This session introduces a relatively new kind of portfolio income insurance: a Contingent Deferred Annuity. It unbundles the insurance from underlying investments so that advisors may “wrap” the risk in client portfolios by covering investments in retail ETFs and mutual funds with lifetime income protections.
The Fed’s move towards more restrictive policy has rattled bonds and put equities on the brink of a bear market. But what is priced in and where do we go from here? In this month’s webinar, we discuss equity and fixed income valuations and examine how Innovator ETFs can help advisors hedge market risk and capitalize on opportunities.
To state the obvious, it has been a good time to be short the market. But the success of bearish traders in 2022 goes beyond luck.
No doubt about it, this has been a very challenging market environment to navigate, and we look to be in for more of the same. The Fed will continue to tighten monetary policy, and the longer the conflict in Ukraine persists, the longer we’ll likely feel the pressure from elevated gas prices.
The S&P 500 declined four out of five days this week, ending Friday higher than all but Monday's close. The index is down 19.7% YTD and is 20.25% below its record close - that makes four consecutive "bear" days and twelve of the last 19.
Quick take: Based on the June S&P 500 average of daily closes, the Crestmont P/E is 124% above its arithmetic mean and at the 98th percentile of this fourteen-plus-decade monthly metric.
In an inflation-lashed world where bonds are posting record losses, Wall Street issuers are betting investors hungry for income will instead lavish their millions on ETFs that ride stocks in order to deliver payouts.
Investors cut holdings in exchange-traded funds for silver, platinum and palladium in the second quarter on fears that a potential recession will reduce industrial demand, but gold assets held up because of its role as a haven, and that may persist.
“HODL,” an original misspelling taken on as a badge of courage by cryptocurrency investors, spread to “Meme stocks” during the runup in 2020 and 2021.
Valid until the market close on July 29, 2022.
The S&P 500 closed June with a monthly loss of 8.39% after a micro-fractional gain of 0.01% in May. At this point, after close on the last day of the month, four of five S&P 500 strategies are signaling "cash" — Vanguard REIT Index ETF (VNQ), iShares Barclays 7-10 Year Treasury (IEF) and Vanguard All-World Index ex-US ETF (VEU), and Vanguard Total Stock Market ETF (VTI) — unchanged from last month's quadruple "cash" signal.
In the light of multiple discussions raised in AP community about strategies that help investors through market downturns, we would like to share a perspective on advantages of an active asset management approach or so-called actively traded hedge-fund strategy based on the example of a classic long-short US equity strategy.
The crypto investing front has taken another barrage of body blows, pushing Bitcoin to test the $19,000 per coin level once again.
Bitcoin is on track for its worst quarter in more than a decade, as hawkish central banks and a string of high-profile crypto blowups hammer sentiment.
It’s official: Chinese equities are once again in vogue, after months of regulatory crackdowns, deleveraging and stringent virus curbs wiped trillions of dollars off benchmark gauges.
In April of this year, the FlexShares team at Northern Trust conducted a survey of more than 500 high-net worth investors who work with financial advisors. The survey asked investors a range of questions about ESG investing including, but not limited to: how much they understand it, why they are or aren’t interested, whether their advisors are recommending it, and how and where they’re learning about ESG investing. My guest today will explain how she and her team used the data to identify trends across different generations, genders, and wealth brackets when it comes to ESG investing.
Here is an advance preview of the monthly moving averages we track after the close of the last business day of the month.
A pair of exchange-traded funds that seek to capitalize on the tendency for US stocks to log the bulk of their gains when the cash market is shut are set to launch Tuesday.
After the steep drop in prices during the first half of this year, yields on many corporate bond investments are at or near 12-year highs.
With this morning's release of the April S&P/Case-Shiller Home Price Index, we learned that seasonally adjusted home prices for the benchmark 20-city index saw a 1.8% increase month over month. The non-seasonally adjusted national index saw a 20.4% YoY increase.
Here are three lessons about the cognitive biases advisors need to be aware of as the trusted protectors of their clients’ financial futures.
All eight indexes on our world watch list posted losses through June 27, 2022. The top performer is London's FTSE 100 with a YTD loss of 1.71%. Hong Kong's Hang Seng is in second with a loss of 4.99% and Tokyo's Nikkei 225 is in third with a loss of 6.67%. Coming in last is Germany's DAXK with a loss of 19.6% YTD.
FINRA has released new data for margin debt, now available through May. The latest debt level is down 2.6% month-over-month.
Cathie Wood’s flagship fund has posted its longest streak of inflows in over a year as it fights back from an interest rate hike-fueled decline.
I will demonstrate how financial advisors can combine behavioral finance and deep analytics to have a robust conversation with clients during financial turmoil, showing compassion and understanding on the one hand, while telling a compelling long-term story on the other hand.
Contrary to economic theory, in recent years funds with an ESG mandate have outperformed the broader market. New research shows that outperformance was caused by increased asset flows to so-called green stocks, raising the prospects for lower returns going forward.
Options insurance. Hedging with Treasuries. Using sentiment to pick a bottom. The things that have lessened the pain of past equity selloffs are coming up short this time around.
Latin America tilted further left this week as Colombian voters elected Gustavo Petro as president. Come August, the former Bogotá mayor and member of the M-19 guerrilla organization will join the region’s growing list of leftist leaders in a political shift some are likening to the “pink tide” of the late 1990s and early 2000s.
If finance could be distilled into one idea, it likely would be that there should be a tradeoff between risk and reward: an investment with low risk should have a low expected return, while one that could make you rich should also be one that could lose you a lot of money. The Overnight Effect flies in the face of this core tenet.
Let’s face it—we love exciting announcements. Why talk about the small technical improvements of a given artificial intelligence (AI) system when you can prognosticate about the coming advent of artificial general intelligence (AGI)? However, focusing too much on AGI risks missing many incremental improvements in the space along the way.
West Texas Intermediate crude oil futures fell below $102 a barrel Wednesday, which represents a 22% drop over the past two weeks and meeting the technical definition of a bear market.
NFIB signals a recession is coming…again.
Two forecasting methods predict a 54% stock market loss in 2022. Someday the stock market bubble will burst. But the data says we have not seen the worst of equity market declines.
Why would I work to increase the profile of an active fund manager? My reasons reflect the increasing pressure on advisors to differentiate themselves and demonstrate value.
Crypto meltdowns. Tech implosions. The biggest rate hike in decades.
Stocks struggled again this past week with the S&P 500 falling -5.79% for the week and the S&P 500 has now lost ground in 10 of the last 11 weeks, falling -19.16%, which is very unusual.
The yellow metal has managed to stay positive since the start of the year, skirting pressure from surging yields and a strong U.S. dollar. Meanwhile, nearly every other asset class has fallen into either correction or bear market territory.
An ETF issuer is following in Cathie Wood’s footsteps with a new innovation-themed fund, despite the fact that her flagship ETF tumbled 61% this year.
Since the start of 2019, investors have plowed more than $300 billion into environmental, social and governance (ESG)-themed exchange traded funds.
Leo Tolstoy’s Anna Karenina opens with one of the most famous lines in world literature: “All happy families are alike, but every unhappy family is unhappy in its own way.”
Though we are seeing the makings of some favourable readings in many on-chain, derivatives, technical and sentiment indicators, the macro and liquidity environment moving forward remain a significant headwind for crypto assets.
I often say that it is a market of stocks and not a stock market.
The better ARK performed, the more money flowed into its main ETF, ARKK. It used this money to buy more sci-fi ARKK stocks, pushing up the prices of its holdings. This created a vicious cycle that has now reversed.
Despite a lot of confident predictions, nobody knows what will happen at the Federal Reserve Wednesday, never mind what the impact will be on markets.
With stocks down around 20% year-to-date, it is important for investors to know what kind of bear they are dealing with.
The Stochastic Oscillator (Stochastics) is one of the commonly used technical indicators by market participants.
Recent experience shows that a third mandate – preventing financial instability – trumps the Fed’s two congressional mandates of full employment and low inflation.
MicroStrategy Inc., ARK Innovation exchange-traded fund, Tesla Inc. and Twitter Inc. are what I’m watching to identify the ultimate capitulation point of this cycle.
Rising inflation, rate hikes, supply-chain problems and the Russia-Ukraine war have contributed to growing recession fears.
I have identified a few opportunities within my portfolio and wealth management practice that prompt consideration for your own strategies as you plan for large estates.
Several avenues for diversifying cryptocurrency portfolios exist. Investors should weigh the costs and benefits of each of the following three methods.
Persistent … or transitory? It’s the inflation question that has been weighing on financial markets over the last year. As each economic data point trickles out, it is analyzed and re-analyzed, with that focus in mind. But it may be the wrong question to ask.
As proxy season comes to a close, investors and advisors have grappled with company stewardship on a wide variety of issues. But what’s the best way to get a company to listen? Is divestment the way to go? Or must you engage with a company? And how do investors in ETFs and mutual funds make sure their voices are heard at the asset managers they invest with?
Engine No. 1 focuses on engaging with companies constructively to make sure they are taking the costs they impose on society and other stakeholders into account. It operates on the belief that climate and social concerns are economic issues and companies that fail to address them will underperform for the long term.
Wall Street is afraid to buy the dip this time around. Even amid this latest leg of the stock market selloff, equities still aren’t fully reflecting the risks facing corporate earnings...
With the Q1 GDP Second Estimate and the May close data, we now have an updated look at the popular "Buffett Indicator" -- the ratio of corporate equities to GDP. The current reading is 205.1%, down from 216.4% the previous quarter.
New research shows that positive returns to ESG portfolios from 2018-2020 were attributed to increased demand for “green“ stocks, raising the question of whether that outperformance will be sustained.
Multi-asset strategies have caught the eye of market participants seeking pre-packaged solutions to diversification. Whereas many of these strategies are becoming increasingly complex—with black-box allocation algorithms, multiple signals, and 10 or more components—the S&P Target Risk Indices offer a more transparent approach.
Read on to explore:
Energy has been on quite a run.
We are treating this column like a running conversation with the reader.
There’s no way of knowing for certain whether a recession is imminent, but for many Americans, it’s sure starting to feel that way. According to Google, more people in the U.S. searched for the term “recession” than at any other time in the past two years.
With National 529 Day last month and graduation season underway, the cost of education is at the top of many people’s minds.
This article is relevant to financial professionals who are considering offering model portfolios to their clients.
Those who are familiar with my articles know that I see market crashes in stocks and bonds occurring in this decade, combined with serious inflation. Readers ask how I recommend protecting. This is it.
I have been doing this long enough to know that the economy is a complex, self-adjusting mechanism, and thus the grim picture I have painted in this and previous articles may not play out.
When will the bear market end?
Cathie Wood says the massive inventories now held by US companies suggest that inflation will die down.
Wall Street is pounding the table on the next big thing in technology, predicting the metaverse could be a $13 trillion industry by the end of the decade.
Howard Marks’s latest memo explores recurring investment themes to contextualize the current market correction and the bull market that preceded it. He discusses the role played by financial innovations like SPACs and cryptocurrencies and why he believes psychology, not fundamentals, primarily drives investment cycles – and likely always will.
The year 2022 sure has felt like a pretty bad one so far: interest rates and consumer prices have spiked up, and stock prices are sharply down. But, in terms of what really matters, many investors are better off than they were at the end of 2021–almost 5% better off for an investor in a diversified balanced portfolio.
Gold and silver is money. Everything else is credit.
Academics argue that there are three proven factors of investing: Value, quality and momentum.
We are excited to start sharing the thought process of Erlanger Research on Advisor Perspectives as perspectives and unique views are something that there is no shortage of in our shop
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 $15,778 for an annualized real return of 9.2%.
The ESG investment industry may be headed for a reckoning and many companies won’t survive this period of higher interest rates.
Here is a summary of the four market valuation indicators we update on a monthly basis.
New research quantifies the implicit cost that investors incur when index funds, such as those tracking the S&P 500, are rebalanced. Those costs may be avoidable by adopting trading strategies that introduce the possibility of tracking error.
Let me take a minute to introduce myself and my publication The FRED Report.
Homeowners should take a total-balance-sheet view when evaluating options for their mortgage.
Note: This update includes May close data.
Is long-term strategic investing out the window? To earn returns in today’s market, you need a team that will rethink your investment philosophy and strategy.
Sharp, countertrend rallies may continue this year, but aggressive Fed policy, the turning of the liquidity tide, and slower economic growth will likely keep pressure on stocks.
Welcome to another subscriber request where I will cover 42 stocks.
The first half of the year has so far been challenging for investors in municipal bonds.
A fascinating aspect of the financial markets is that long-term returns are driven almost entirely by math, while short-term returns are driven almost entirely by psychology.
We’re here to talk about misconceived notions that advisors have about millennial investors. While it is often reported that millennials are rejecting financial advisors, my guest says this is not the case. The biggest issue that he sees is that financial advisors have minimums that make it difficult to serve millennials at the tail-end of the age bracket (those born between 1990-1996, or age 26 to 32). That cohort typically has not accumulated enough money to meet the minimum requirement needed to work with fee-based advisors.
Thanks to the spectacular demise of TerraUSD, a cryptocurrency that promised to be always worth a dollar but was suddenly worth a lot less, the world is better acquainted with the term “stablecoin” — and aware of how unstable they can be.
Last week’s rising stock prices suggested that many investors are still wishing the Federal Reserve will step in to counter downward pressures on the market. Hopes for this “Fed put,” however, may be confusing the Fed’s willingness to act with its ability to do so.
Quick take: At the end of May the inflation-adjusted S&P 500 index price was 131% above its long-term trend, down from 151% above the previous month.
About the only certainty in the stock market is that, over the long haul, over performance turns into underperformance and vice versa. Is there a pattern to this movement? Let's apply some simple regression analysis to the question.
The tale of Bear Stearns’ rally and investors' myopic vision in the spring of 2008 is a valuable lesson for today.
Was the March 2009 low the end of a secular bear market and the beginning of a secular bull?
Through rising real yields, a slowing economy and poor seasonality, short-term headwinds remain for gold and precious metals.
ETF
Insuring Client Spending in Retirement with Portfolio Income Insurance
With the growth in 401(k) plans and the contraction of private pensions over the last 30 years, risks in retirement have slowly and almost imperceptibly transferred from institutions to individuals. Institutions staffed with actuaries and analysts are well suited to manage those risks. Individual investors may need some help.
This session introduces a relatively new kind of portfolio income insurance: a Contingent Deferred Annuity. It unbundles the insurance from underlying investments so that advisors may “wrap” the risk in client portfolios by covering investments in retail ETFs and mutual funds with lifetime income protections.
Tackling restrictive Fed policy, inflation and a recessionary sentiment with Defined Outcome ETFs
The Fed’s move towards more restrictive policy has rattled bonds and put equities on the brink of a bear market. But what is priced in and where do we go from here? In this month’s webinar, we discuss equity and fixed income valuations and examine how Innovator ETFs can help advisors hedge market risk and capitalize on opportunities.
Bears Picked Right Stocks to Short With Declines Twice the S&P’s
To state the obvious, it has been a good time to be short the market. But the success of bearish traders in 2022 goes beyond luck.
Nowhere to Run, Nowhere to Hide
No doubt about it, this has been a very challenging market environment to navigate, and we look to be in for more of the same. The Fed will continue to tighten monetary policy, and the longer the conflict in Ukraine persists, the longer we’ll likely feel the pressure from elevated gas prices.
S&P 500 Snapshot: Down Again
The S&P 500 declined four out of five days this week, ending Friday higher than all but Monday's close. The index is down 19.7% YTD and is 20.25% below its record close - that makes four consecutive "bear" days and twelve of the last 19.
Crestmont Market Valuation Update: June 2022
Quick take: Based on the June S&P 500 average of daily closes, the Crestmont P/E is 124% above its arithmetic mean and at the 98th percentile of this fourteen-plus-decade monthly metric.
Existential Crisis in Bonds Fuels Wall Street’s Income ETF Boom
In an inflation-lashed world where bonds are posting record losses, Wall Street issuers are betting investors hungry for income will instead lavish their millions on ETFs that ride stocks in order to deliver payouts.
Gold Keeps Its Shine for Investors as Other Precious Metals Fade
Investors cut holdings in exchange-traded funds for silver, platinum and palladium in the second quarter on fears that a potential recession will reduce industrial demand, but gold assets held up because of its role as a haven, and that may persist.
“HODL” Finds Its Inevitable Flaw
“HODL,” an original misspelling taken on as a badge of courage by cryptocurrency investors, spread to “Meme stocks” during the runup in 2020 and 2021.
Moving Averages: S&P Down 8.4% in June
Valid until the market close on July 29, 2022.
The S&P 500 closed June with a monthly loss of 8.39% after a micro-fractional gain of 0.01% in May. At this point, after close on the last day of the month, four of five S&P 500 strategies are signaling "cash" — Vanguard REIT Index ETF (VNQ), iShares Barclays 7-10 Year Treasury (IEF) and Vanguard All-World Index ex-US ETF (VEU), and Vanguard Total Stock Market ETF (VTI) — unchanged from last month's quadruple "cash" signal.
Safer With an Active Asset Management Approach Than with None or a Passive One
In the light of multiple discussions raised in AP community about strategies that help investors through market downturns, we would like to share a perspective on advantages of an active asset management approach or so-called actively traded hedge-fund strategy based on the example of a classic long-short US equity strategy.
Bitcoin Tests $19,000
The crypto investing front has taken another barrage of body blows, pushing Bitcoin to test the $19,000 per coin level once again.
Bitcoin Set for Biggest Quarterly Drop in More Than a Decade
Bitcoin is on track for its worst quarter in more than a decade, as hawkish central banks and a string of high-profile crypto blowups hammer sentiment.
China’s World-Beating Stock Rally Is Forecast to Strengthen More
It’s official: Chinese equities are once again in vogue, after months of regulatory crackdowns, deleveraging and stringent virus curbs wiped trillions of dollars off benchmark gauges.
What HNW Investors are Saying About ESG
In April of this year, the FlexShares team at Northern Trust conducted a survey of more than 500 high-net worth investors who work with financial advisors. The survey asked investors a range of questions about ESG investing including, but not limited to: how much they understand it, why they are or aren’t interested, whether their advisors are recommending it, and how and where they’re learning about ESG investing. My guest today will explain how she and her team used the data to identify trends across different generations, genders, and wealth brackets when it comes to ESG investing.
Moving Averages Month-End Preview: Down 7.6% in June
Here is an advance preview of the monthly moving averages we track after the close of the last business day of the month.
ETFs Offering Way to Bet on Overnight Equity Gains Set to Launch
A pair of exchange-traded funds that seek to capitalize on the tendency for US stocks to log the bulk of their gains when the cash market is shut are set to launch Tuesday.
2022 Mid-Year Corporate Credit Outlook
After the steep drop in prices during the first half of this year, yields on many corporate bond investments are at or near 12-year highs.
April S&P/Case-Shiller Home Price Index: Up 20% YoY
With this morning's release of the April S&P/Case-Shiller Home Price Index, we learned that seasonally adjusted home prices for the benchmark 20-city index saw a 1.8% increase month over month. The non-seasonally adjusted national index saw a 20.4% YoY increase.
Three Lessons About Cognitive Biases
Here are three lessons about the cognitive biases advisors need to be aware of as the trusted protectors of their clients’ financial futures.
World Markets Update: June 27, 2022
All eight indexes on our world watch list posted losses through June 27, 2022. The top performer is London's FTSE 100 with a YTD loss of 1.71%. Hong Kong's Hang Seng is in second with a loss of 4.99% and Tokyo's Nikkei 225 is in third with a loss of 6.67%. Coming in last is Germany's DAXK with a loss of 19.6% YTD.
Margin Debt: Down 2.6% in May
FINRA has released new data for margin debt, now available through May. The latest debt level is down 2.6% month-over-month.
Cathie Wood’s ARKK Posts Longest Inflow Streak in Over a Year
Cathie Wood’s flagship fund has posted its longest streak of inflows in over a year as it fights back from an interest rate hike-fueled decline.
A Deep Analytic Perspective of the 2022 Market Correction
I will demonstrate how financial advisors can combine behavioral finance and deep analytics to have a robust conversation with clients during financial turmoil, showing compassion and understanding on the one hand, while telling a compelling long-term story on the other hand.
An Ominous Sign for ESG Investors
Contrary to economic theory, in recent years funds with an ESG mandate have outperformed the broader market. New research shows that outperformance was caused by increased asset flows to so-called green stocks, raising the prospects for lower returns going forward.
Market Is Shredding All the Time-Tested Ways to Chart Its Course
Options insurance. Hedging with Treasuries. Using sentiment to pick a bottom. The things that have lessened the pain of past equity selloffs are coming up short this time around.
A New “Pink Tide” in Latin America?
Latin America tilted further left this week as Colombian voters elected Gustavo Petro as president. Come August, the former Bogotá mayor and member of the M-19 guerrilla organization will join the region’s growing list of leftist leaders in a political shift some are likening to the “pink tide” of the late 1990s and early 2000s.
Night Moves: Is the Overnight Drift the Grandmother of All Market Anomalies?
If finance could be distilled into one idea, it likely would be that there should be a tradeoff between risk and reward: an investment with low risk should have a low expected return, while one that could make you rich should also be one that could lose you a lot of money. The Overnight Effect flies in the face of this core tenet.
A Realistic Framing of the Progress in Artificial Intelligence
Let’s face it—we love exciting announcements. Why talk about the small technical improvements of a given artificial intelligence (AI) system when you can prognosticate about the coming advent of artificial general intelligence (AGI)? However, focusing too much on AGI risks missing many incremental improvements in the space along the way.
Oil Is in Another Bear Market - and for Good Reason
West Texas Intermediate crude oil futures fell below $102 a barrel Wednesday, which represents a 22% drop over the past two weeks and meeting the technical definition of a bear market.
NFIB Signals A Recession Is Coming…Again
NFIB signals a recession is coming…again.
This is Not the Market Bottom
Two forecasting methods predict a 54% stock market loss in 2022. Someday the stock market bubble will burst. But the data says we have not seen the worst of equity market declines.
Why I Consulted with an Active Fund Manager
Why would I work to increase the profile of an active fund manager? My reasons reflect the increasing pressure on advisors to differentiate themselves and demonstrate value.
Why Insiders Are Bullish When Nobody Else Is
Crypto meltdowns. Tech implosions. The biggest rate hike in decades.
DMA Table Still Negative. But Erlanger Options Rank Showing Extreme Short Selling Indicating A Bounce In The Offing
Stocks struggled again this past week with the S&P 500 falling -5.79% for the week and the S&P 500 has now lost ground in 10 of the last 11 weeks, falling -19.16%, which is very unusual.
Gold Has Been One of the Few Bright Spots in 2022 (So Far)
The yellow metal has managed to stay positive since the start of the year, skirting pressure from surging yields and a strong U.S. dollar. Meanwhile, nearly every other asset class has fallen into either correction or bear market territory.
Cathie Wood’s ARKK Has Tumbled 61%, Yet Gets Another Copycat
An ETF issuer is following in Cathie Wood’s footsteps with a new innovation-themed fund, despite the fact that her flagship ETF tumbled 61% this year.
ESG Investment Cools as the Sector’s Notoriety Grows
Since the start of 2019, investors have plowed more than $300 billion into environmental, social and governance (ESG)-themed exchange traded funds.
Everything You Wanted To Know About Bear Markets
Leo Tolstoy’s Anna Karenina opens with one of the most famous lines in world literature: “All happy families are alike, but every unhappy family is unhappy in its own way.”
Crypto Market Outlook: Risk-Off
Though we are seeing the makings of some favourable readings in many on-chain, derivatives, technical and sentiment indicators, the macro and liquidity environment moving forward remain a significant headwind for crypto assets.
15 Stocks You Asked To See
I often say that it is a market of stocks and not a stock market.
ARKK Stocks Sunk
The better ARK performed, the more money flowed into its main ETF, ARKK. It used this money to buy more sci-fi ARKK stocks, pushing up the prices of its holdings. This created a vicious cycle that has now reversed.
Big Money in Stock Market Is In Mad Dash to Get Out of Fed’s Way
Despite a lot of confident predictions, nobody knows what will happen at the Federal Reserve Wednesday, never mind what the impact will be on markets.
Bear Watch
With stocks down around 20% year-to-date, it is important for investors to know what kind of bear they are dealing with.
Technical Perspective: Using Stochastics to Help Advisors Navigate the Markets and Stock Positioning.
The Stochastic Oscillator (Stochastics) is one of the commonly used technical indicators by market participants.
Will the Fed’s Third Mandate Derail Markets?
Recent experience shows that a third mandate – preventing financial instability – trumps the Fed’s two congressional mandates of full employment and low inflation.
Tesla, MicroStrategy, Ark ETF Need to Capitulate Before Stocks Bottom
MicroStrategy Inc., ARK Innovation exchange-traded fund, Tesla Inc. and Twitter Inc. are what I’m watching to identify the ultimate capitulation point of this cycle.
Signs Point to Rising Recession Risk
Rising inflation, rate hikes, supply-chain problems and the Russia-Ukraine war have contributed to growing recession fears.
Opportunities in Tax Efficiency
I have identified a few opportunities within my portfolio and wealth management practice that prompt consideration for your own strategies as you plan for large estates.
How to Build a Diversified Crypto Allocation
Several avenues for diversifying cryptocurrency portfolios exist. Investors should weigh the costs and benefits of each of the following three methods.
Inflation Risk: Persistent or Transitory is the Wrong Question
Persistent … or transitory? It’s the inflation question that has been weighing on financial markets over the last year. As each economic data point trickles out, it is analyzed and re-analyzed, with that focus in mind. But it may be the wrong question to ask.
Engine No. 1 and Its Compelling Approach to ESG Investing
As proxy season comes to a close, investors and advisors have grappled with company stewardship on a wide variety of issues. But what’s the best way to get a company to listen? Is divestment the way to go? Or must you engage with a company? And how do investors in ETFs and mutual funds make sure their voices are heard at the asset managers they invest with?
Engine No. 1 focuses on engaging with companies constructively to make sure they are taking the costs they impose on society and other stakeholders into account. It operates on the belief that climate and social concerns are economic issues and companies that fail to address them will underperform for the long term.
Wall Street Sours on S&P as Margin Woes Rattle Corporate America
Wall Street is afraid to buy the dip this time around. Even amid this latest leg of the stock market selloff, equities still aren’t fully reflecting the risks facing corporate earnings...
Market Cap to GDP: May Buffett Valuation Indicator
With the Q1 GDP Second Estimate and the May close data, we now have an updated look at the popular "Buffett Indicator" -- the ratio of corporate equities to GDP. The current reading is 205.1%, down from 216.4% the previous quarter.
Sobering News for ESG Investors
New research shows that positive returns to ESG portfolios from 2018-2020 were attributed to increased demand for “green“ stocks, raising the question of whether that outperformance will be sustained.
A Streamlined Approach to Multi-Asset with the S&P Target Risk Indices
Multi-asset strategies have caught the eye of market participants seeking pre-packaged solutions to diversification. Whereas many of these strategies are becoming increasingly complex—with black-box allocation algorithms, multiple signals, and 10 or more components—the S&P Target Risk Indices offer a more transparent approach.
Read on to explore:
I’m Buying Another Dirt-Cheap Energy Stock
Energy has been on quite a run.
Stocks and Bonds Remain Weak On DMA Table, New Buy Salesforce.com Inc (CRM)
We are treating this column like a running conversation with the reader.
Are We Headed for Recession? Gold and Bitcoin Could Offer Some Cover
There’s no way of knowing for certain whether a recession is imminent, but for many Americans, it’s sure starting to feel that way. According to Google, more people in the U.S. searched for the term “recession” than at any other time in the past two years.
Saving For College: Start Small, But Start Now
With National 529 Day last month and graduation season underway, the cost of education is at the top of many people’s minds.
The Current and Future State of Model Portfolios
This article is relevant to financial professionals who are considering offering model portfolios to their clients.
How I Protect Against the Coming Market Crash
Those who are familiar with my articles know that I see market crashes in stocks and bonds occurring in this decade, combined with serious inflation. Readers ask how I recommend protecting. This is it.
Stagflation May Be Our Next Stop (but that is not what I am worried about)
I have been doing this long enough to know that the economy is a complex, self-adjusting mechanism, and thus the grim picture I have painted in this and previous articles may not play out.
When Will This Bear Market End?
When will the bear market end?
Wood Sees Huge Inventories as Evidence Inflation Will Ebb
Cathie Wood says the massive inventories now held by US companies suggest that inflation will die down.
As Meta Ditches FB Ticker, Investors Shun Metaverse
Wall Street is pounding the table on the next big thing in technology, predicting the metaverse could be a $13 trillion industry by the end of the decade.
Bull Market Rhymes
Howard Marks’s latest memo explores recurring investment themes to contextualize the current market correction and the bull market that preceded it. He discusses the role played by financial innovations like SPACs and cryptocurrencies and why he believes psychology, not fundamentals, primarily drives investment cycles – and likely always will.
How I Learned to Stop Worrying, and Love the (Interest Rate) Bomb
The year 2022 sure has felt like a pretty bad one so far: interest rates and consumer prices have spiked up, and stock prices are sharply down. But, in terms of what really matters, many investors are better off than they were at the end of 2021–almost 5% better off for an investor in a diversified balanced portfolio.
Is Gold the Answer?
Gold and silver is money. Everything else is credit.
When Quality Fails
Academics argue that there are three proven factors of investing: Value, quality and momentum.
Why Didn't I Sell Advanced Micro?
We are excited to start sharing the thought process of Erlanger Research on Advisor Perspectives as perspectives and unique views are something that there is no shortage of in our shop
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 $15,778 for an annualized real return of 9.2%.
ESG Investing Is Heading for a Reckoning, Says One Veteran Manager
The ESG investment industry may be headed for a reckoning and many companies won’t survive this period of higher interest rates.
Is the Market Still Overvalued?
Here is a summary of the four market valuation indicators we update on a monthly basis.
The Problems with Market-Cap Weighted Index Funds
New research quantifies the implicit cost that investors incur when index funds, such as those tracking the S&P 500, are rebalanced. Those costs may be avoidable by adopting trading strategies that introduce the possibility of tracking error.
Quality Growth Is Not Dead
Let me take a minute to introduce myself and my publication The FRED Report.
Your Mortgage is Not a Hedge Against Inflation
Homeowners should take a total-balance-sheet view when evaluating options for their mortgage.
The Q Ratio and Market Valuation: May Update
Note: This update includes May close data.
Staying the Course No Longer Works?
Is long-term strategic investing out the window? To earn returns in today’s market, you need a team that will rethink your investment philosophy and strategy.
2022 Mid-Year Outlook: U.S. Stocks and Economy
Sharp, countertrend rallies may continue this year, but aggressive Fed policy, the turning of the liquidity tide, and slower economic growth will likely keep pressure on stocks.
It’s a Market of Stocks Not a Stock Market
Welcome to another subscriber request where I will cover 42 stocks.
Making The Case for Municipal Bonds Despite Recent Volatility
The first half of the year has so far been challenging for investors in municipal bonds.
Making Friends with Bears Through Math
A fascinating aspect of the financial markets is that long-term returns are driven almost entirely by math, while short-term returns are driven almost entirely by psychology.
The Hidden Opportunity to Serve Millennial Clients
We’re here to talk about misconceived notions that advisors have about millennial investors. While it is often reported that millennials are rejecting financial advisors, my guest says this is not the case. The biggest issue that he sees is that financial advisors have minimums that make it difficult to serve millennials at the tail-end of the age bracket (those born between 1990-1996, or age 26 to 32). That cohort typically has not accumulated enough money to meet the minimum requirement needed to work with fee-based advisors.
The Next Stablecoin Collapse Could Be a Lot Worse
Thanks to the spectacular demise of TerraUSD, a cryptocurrency that promised to be always worth a dollar but was suddenly worth a lot less, the world is better acquainted with the term “stablecoin” — and aware of how unstable they can be.
Don’t Wish for the Fed to Pause Rate Hikes in September
Last week’s rising stock prices suggested that many investors are still wishing the Federal Reserve will step in to counter downward pressures on the market. Hopes for this “Fed put,” however, may be confusing the Fed’s willingness to act with its ability to do so.
Regression to Trend: 131% Above Trend in May
Quick take: At the end of May the inflation-adjusted S&P 500 index price was 131% above its long-term trend, down from 151% above the previous month.
About the only certainty in the stock market is that, over the long haul, over performance turns into underperformance and vice versa. Is there a pattern to this movement? Let's apply some simple regression analysis to the question.
Bear Stearns: A Lesson in Bear Market Bounces
The tale of Bear Stearns’ rally and investors' myopic vision in the spring of 2008 is a valuable lesson for today.
A Perspective on Secular Bull and Bear Markets
Was the March 2009 low the end of a secular bear market and the beginning of a secular bull?
Short-Term Headwinds Abound For Gold
Through rising real yields, a slowing economy and poor seasonality, short-term headwinds remain for gold and precious metals.