Tuesday, February 11, 2020
Sunday, November 27, 2016
Your Weekly Update - US Home Sales Grow
Weekly Market RecapThis week saw further improvement in US house prices for October with growth across all main US regions. Internationally, consumer confidence improved within the EU based on an October survey and industrial trends for the UK were positive based on Confederation of British Industry (CBI) data. Futures markets as well as comments by policy makers suggest that interest rates could rise at the Fed's December meeting in just over two weeks. It is worth remembering that, should this occur, rates are rising in response to a relatively robust US economy in the eyes of policy makers, and that this tightening cycle has so far been extremely slow relative to history. If rates do rise, then the last rise would have been one year ago and rates remain low, relative to history. Additionally, according to the book, Invest with the Fed by Robert Johnson, equities and bonds have historically over the long-term experienced positive returns regardless of whether interest rates are rising, falling or indeterminate. So rising interest rates, as with many factors that might cause short-term volatility and headlines, are not necessarily harmful to a balanced portfolio, based on history. Disclaimer: Your Portfolio Summary
Ways To Improve Your Portfolio
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Saturday, November 19, 2016
Your Weekly Update - US Consumer Spending Grows
Weekly Market RecapUS retail sales rose in October, helped by strong auto sales. However, US industrial production was soft. Internationally, estimates of Eurozone growth in Q3 remained at 1.6% in line with expectations. As we approach the end of the year, here's a quick reminder on how tax-loss harvesting works. The goal of tax-loss harvesting is to defer payment of investment-related taxes into the future. Realizing short-term losses on investments can offset and therefore potentially reduce tax payments in the short-term. The impact on the risk/return characteristics of the portfolio is limited because when an investment is sold to harvest the taxable loss, a similar one is purchased. Tax-loss harvesting has the potential to push investment-related tax payments out further into the future by pulling taxable losses forward. Whereas traditionally, manual tax-loss harvesting is typically done in December, we monitor for tax-loss harvesting on an ongoing basis in Premium portfolios. We believe our ongoing approach can uncover more opportunities to apply the benefits of tax-loss harvesting. Disclaimer: Your Portfolio Summary
Ways To Improve Your Portfolio
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Sunday, November 13, 2016
Your Weekly Update - GOP Makes Electoral Gains
Weekly Market RecapThis week the financial markets and the media were dominated by the outcome of the US election. It was a Republican sweep. Donald Trump won the Presidency and the GOP retained the House, and the Senate, by a smaller margin. Volatility in many financial markets was elevated around election night. Ultimately the outcome was met with a positive market reaction across most developed stock markets. One example of the volatility around the election is the Japanese stock market index, the Nikkei, which fell over 5% when a Trump victory first seemed probable. This lead to the media using terms like "plummet" and "tank" only to see the Nikkei reverse and move up just under 7% the next day. This example shows that potential sensationalism in the media, and short-term reactions in the markets, isn't always helpful when looking to maintain a consistent investment strategy. The election outcome also highlights the importance of diversified sector exposure. If you pick stocks for your own portfolio, you may, perhaps inadvertently, find yourself under- or over-exposed to certain sectors of the economy relatively to the broader market. Going into the election, many investors sold stocks in the pharmaceuticals, financials, and industrial sectors only to see those sectors perform notably well relative to the broader US market after the election. Having a diversified sector approach, such as tracking a broad stock market index, can help buffer your portfolio from short-term swings in market sentiment. Disclaimer: Your Portfolio Summary
Ways To Improve Your Portfolio
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Saturday, November 5, 2016
Your Weekly Update - Fed Keeps Rates Unchanges
Weekly Market RecapThe US Federal Reserve (Fed) held interest rates constant at their November meeting. When looking at the US economy, the Fed sees solid job gains and economic activity picking up from the first half of the year. However, the Fed views US business investment as soft and recent US inflation is below their 2% long-run objective. In the Fed's view the case for a rate increase "continues to strengthen". In Europe, the preliminary estimate of EU Q3 growth came in at 1.6% year-on-year broadly consistent with recent quarters. With only a few pay periods remaining in 2016 we remind you to review your 401(k) plan contributions if you haven't already done so. Participation in a 401(k) plan can potentially defer taxes on retirement saving, but a second important benefit can be contribution matching from your employer. Contributing matching means having your employer match a portion of your 401(k) contributions up to a certain level. This can be an effective way to grow your retirement savings. Employer 401(k) plans and matching levels vary by employer, also note that 401(k)s are common at for profit employers, other employers such as non-profits, government and the military are likely to offer 403(b), 457 or TSP plans to help retirement saving. Most 401(k) plans have a threshold that contributions are matched up to such as 6% of annual pay and some plans match dollar-for-dollar to a maximum level. Matching in some 401(k) plans vests, which mean you need to remain at your employer for a given time to get the full benefit. Since 401(k) matching can help you reach your retirement goals, we believe it's worth understanding the specific details of what your employer offers and consider contributing at least up to the level that receives a full employer match. Disclaimer: Your Portfolio Summary
Ways To Improve Your Portfolio
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Sunday, October 30, 2016
Your Weekly Update - US Growth Moves Up
Weekly Market RecapThis week, US economic growth came in at 2.9% year-on-year for Q3 of 2016 as initially estimated by the Bureau of Economic Analysis. If this estimate holds, it would be the highest rate of US quarterly GDP (Gross Domestic Product) growth in 2 years. Separately, surveys of purchasing managers suggested a positive outlook for manufacturing in the US and Europe for October, with Germany notably strong. US house prices continued to rise, up 5.1% for the last 12 months on Case-Shiller data. US consumer confidence softened slightly. As you contemplate your retirement, it's worth taking note of how the nature of retirement has changed in recent decades. In the 1950's life expectancy in the US at birth was estimated at 68 years based on census data, and it's now over 78. Americans born today are, on average, expected to live roughly a decade longer than their grandparents. This increase is generally attributed to improvements in public health. As you might expect, this increase in life expectancy has extended the retirement years. The average retirement age has increased slightly in the US, but not to the same extent that life expectancy has, which means a longer retirement for most people. In addition, this trend may well continue as many experts see US life expectancy increasing further. This is why retirement saving is so important. It can give you quality of life and flexibility in your later years, especially because you will likely have a significantly longer retirement than prior generations. Disclaimer: Your Portfolio Summary
Ways To Improve Your Portfolio
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Saturday, October 22, 2016
Your portfolio down 2.0% over the last 30 days as inflation nudges up
Weekly Market RecapThe September release of US inflation (the rate of change in average prices), saw prices rising at a 1.5% annual rate, boosted primarily by rising energy prices. This is still low by historical standards, but suggests that US inflation could be returning to a level more consistent with historical norms after very low figures in recent months. Across developed markets, inflation has remained relatively subdued at a 1% annual rate, or below. In fact, in Japan, prices are even declining based on most recent data. Inflation matters for investors because as prices rise, a dollar can purchase less, on average, making your savings worth less in terms of purchasing power. Therefore, all else equal, subdued inflation has historically been good for savers. For example, unexpected spikes in inflation, as we experienced in the US in the 1970s, was temporarily harmful to diversified portfolio returns. That's one reason why we believe including attractive assets that also offer a degree of inflation protection, like TIPS or REITs, can be prudent for long-term portfolios. Disclaimer: Your Portfolio Update
Over the past month your portfolio was down 2.0%, and we have no recommendations at this time to improve it. Congratulations on maintaining one of the best portfolios among all our clients. We will, as always, continue monitoring your account and alerting you if there are actions to take (periodic rebalancing is required, etc). Ways To Improve Your Portfolio
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