ECONOMICS & INVESTING

The Anatomy of a Bear Market

The Anatomy of a Bear Market

What does a typical bear market look like? How long do they last? When are the majority of the losses incurred?

Using Total Return to Meet Your Clients’ Withdrawal Needs

Using Total Return to Meet Your Clients’ Withdrawal Needs

For decades most financial plans were created with withdrawal rates of 4 to 5% to meet clients’ living needs. Yet today, the 10-year U.S. Treasury yield is hovering around 0.65% and even the 30-year has a ~1.0% yield. Worse yet, yields on equities have also trended lower with the dividend yield of the S&P 500® Index sitting at ~2.1%.

Bond ETF’s Price Divergence From NAV: How Do We Tell Which Was “Right”?

Bond ETF’s Price Divergence From NAV: How Do We Tell Which Was “Right”?

“What happened to fixed income ETFs in the March sell-off?” So far, we’ve kept quiet on the subject. Not due to a lack of opinions, but because we felt we didn’t have much to add to the discussion. Our many fund sponsor and trading partners (SSGA, iShares, Invesco, and Jane Street to name a few) have done a fantastic job of providing detailed analyses on the subject.

The Anatomy of a Bear Market

A Caution From 2007: Beware of the Dividend in Your High Dividend ETFs & Funds

Remember this? It’s late in 2007 and the banks have already started their downward spiral. As their prices fell, their dividend yields rose. Most “high yielding,” “high dividend” or “dividend achiever” type ETFs/funds rebalance quarterly, so at year end, what did they do? They loaded up on bank stocks.

A Word of Caution on Fixed Income in the Current Market Environment

A Word of Caution on Fixed Income in the Current Market Environment

Investors of balanced strategic portfolios as well as effective tactical portfolios are now well aware of the benefits of reduced risk during times of market duress. While volatile markets may encourage investors to seek the historical “safe havens” of fixed income and lower risk investments, an unfortunately timed rebalance or re-allocation towards fixed income can be particularly risky in today’s environment.

Technology Sector in the “Work from Home” Economy

Technology Sector in the “Work from Home” Economy

Although none of our investment systems directly incorporate fundamental data, we enjoy contemplating the fundamental narratives reflected in the price trends our systems ultimately find attractive. Our systems are currently quite leery of equity or other risk assets, as we now sit firmly in a bear market induced by the widespread economic halt caused by COVID-19.

Using Total Return to Meet Your Clients’ Withdrawal Needs

Recent Repo Market Fiasco and Intervention

Recently a reader asked us to explain “the recent Repo Market Fiasco and the Fed’s intervention,” as well as the consequences and outcomes. For those of you who regularly read our blog, we first included a chart on this subject on September 23, 2019. The answer is fairly technical, but let’s focus on some charts to show the enormity of the issue first.

An Open Letter to Jerome Powell

An Open Letter to Jerome Powell

I write this letter with the utmost gratitude and respect. You see, unlike your predecessors, this time you and your Committee acted quickly, decisively and appropriately to a rapidly evolving political and macro-economic world. It is hard to contemplate what Congress has charged the Federal Open Market Committee (FOMC), and you, to do.

Are You Prepared?

Are You Prepared?

Most investment professionals would agree that stock market price movement in the 0-5% range is just ordinary market movement or statistical “noise”.