Target-date funds have made investing easier over the past few decades, offering investors a one-stop investment solution. Also known as life-cycle or age-based funds, they comprise of a mix of holdings that alter over time, based upon a specific target date.
Such funds have allowed many individuals to gain confidence investing beyond cash and CDs. This is a positive step forward, and there are certainly merits to using target-date funds in a number of situations. However, there are also indicators that a savvy investor should be cognizant of in advance. Read More
President Trump has hit the ground running since his inauguration, with a flurry of executive activity on many different fronts. While it’s early in the new administration to start making forecasts, a number of key strategies aimed at boosting the economy also suggest that a potentially inflationary environment could be ahead.
A healthy growing economy would be a positive step forward for the US. Furthermore, some additional level of inflation could be a welcome event after years of relative stagnation. However, potential signs of inflation always deserve some advance consideration, both within your investments and within your personal finances. Read More
The Dow Jones Industrial Average (Dow) recently topped 20,000, setting a new record high and achieving a symbolic moment in US investment history. Investor sentiment has been climbing for a number of months, and a recent post-election market rally energized the Dow to finally cross this much-anticipated market boundary. The last time the Dow crossed such an important threshold was in 1999, when it hit 10,000.
This recent market movement begs the question of what happens next. Could this latest defining moment in the Dow’s history echo the downturn that followed 1999’s high point, when it took 11 years to re-secure the Dow’s standing of 10,000? Alternatively, will the momentum continue, extending the second longest market rally in recent times, and providing investors with increased opportunities for financial advancement? Read More
For the past several years, many investors have been tempted by the too-good-to-be-true descriptions of structured CDs (also known as market-linked CDs). These instruments often claim to offer the upside of stock market or other investment exposure, with little-to-no downside risk.
Enough years have now passed since the inception of structured CDs to allow adequate evaluation of their investment results. A recent analysis reviewed their effectiveness, and the results support the age-old saying of, “If it sounds too good to be true, it probably is.” Read More
Last year started fairly steady and strong, but lingering risks from the summer caused 2015 to fall flat, with broad-based negative stock market returns. Most economists predicted a healthy 2015, and it should have been by a number of historical standards. Unfortunately, not even the beloved Santa Claus Rally came to fruition. On the heels of such a year, and a rocky start to 2016, investors are left questioning the outlook for the markets. Last year proved that forecasts can easily go awry. That said, we offer our insights for the year ahead. Read More
A docile second quarter proved to be anything but calm in its final week, as a convergence of international events in Greece, Puerto Rico and China captured headlines and erased second quarter market gains. The quarter end’s sudden drop occurred in spite of continuing improvement in the U.S. economy and in many of the world’s larger market economies.
The next few weeks could determine if continued economic recovery is enough to fuel a full seven-year bull market rally. Read More
It’s always important to evaluate your investment structure, and perhaps more so today, as the U.S. equity markets are now in their seventh year of a bull market cycle. This isn’t the longest or greatest bull market in history, but it is now the S&P 500’s third longest and fourth strongest bull market since 1929. It’s also well beyond the averages, as illustrated below.
This means that it might be a good time to take stock of your stock market exposure. Read More
So far, 2015 marks a distinct reversal in U.S. market dominance as large-cap stocks floundered while international stocks thrived. The S&P 500 index and the Dow Industrial Average experienced significant up and down days, but ultimately moved nowhere.
Largely, a dramatic rise in the U.S. Dollar, placing our companies at a competitive disadvantage. Read More
We recently came across an article in the New York Times that predominantly discussed mutual fund fees and alleged investment advisory conflicts. The public commentary in this and other similar pieces is well intentioned, with an objective of helping investors plan for retirement. However, we are concerned that some discussions lack clarification and that, worse, they could scare Americans away from saving for their futures.
It seems timely to offer a few words on the advantages of working with a Registered Investment Advisor and fiduciary like SageVest, as well as important information to give you peace of mind about our services and how we structure the investments in client portfolios. Read More
Investors closely eyed the Federal Reserve (the Fed) this week, looking for indications of the first Fed funds rate increase since 2008.
The federal funds rate is the key driver for all types of interest rates and varies depending upon the strength of the economy. It sets the bar for bond prices, mortgages, loan rates, investments, real estate valuations, and so much more. As expected, the Fed removed the word “patient” from its policy statement, thereby opening the door to higher interest rates in the near-term. Read More
2014 was a banner year for the S&P 500 and the Dow Industrial Average as both indices set new records.
While the celebrations were joyous, they were also lonely when we look broadly across the investment markets. Smaller US companies posted meager returns after trending flat to negative for much of the year. International stocks had a less favorable outcome, ending down for the year in the wake of a global economic slowdown. Read More
Our domestic economy enjoyed a number of growth achievements in the third quarter, but investment results were mixed, with more negative results than positive in the wake of troubling global developments. The S&P 500 and the Barclays Aggregate Bond Index managed to post modest advancements of 0.62% and 0.17%, respectively. However, a far longer list of asset classes retreated, including US small-cap stocks down -7.36% and international equities down -5.27%, along with declines in real estate and commodities. The strongest sectors of the quarter were health care and technology. Energy and utility stocks fared worst. Read More
Investment markets painted a sea of green through the first half of the year as all major asset classes (stocks, bonds, commodities and real estate) were in positive territory. Stocks posted several new highs, despite advancing at a slower pace than 2013. The ‘surprise’ investment was bonds, which rallied as the 10-year Treasury rate dropped from 3% at year-end to 2.5% as of June 30th, rewarding bond owners at a time when many expected rising interest rates. Investors who remained in the markets have enjoyed positive absolute returns and an unusual level of market tranquility, offering a pleasant start to summer. Read More
After a stellar year for the stock market in 2013, the first quarter ended largely unchanged, yet with a fair amount of volatility along the way.
Stocks eked out modest gains, allowing the extended bull market to celebrate its fifth birthday in March, making this the sixth longest bull market since 1928. Bonds posted the greatest returns as investor confidence began to wane, causing flight into the safety of Treasuries. Bonds surged 1.8% in the first quarter, reflecting investor fatigue towards growth in the midst of Fed tapering, one of the worst winters in history and geopolitical uncertainty in the Ukraine that resurrected coldwar tensions with Russia. Read More
U.S. stocks dominated investment returns in 2013 as the S&P 500 index posted a 30% return, the strongest since 1997. Investors rejoiced in continued economic recovery as well as continued easy money policies extended by the Fed.
It was a year when U.S. stock markets maintained positive year-to-date returns on every trading day of the year, following an almost perfect upward trajectory in the fifth year of a bull market.
A strong year in the US extended in the third quarter as both the US stock market and household networth set new all-time highs. Fortunately, the good news didn’t stop there. Previously sluggish international stocks staged a strong rally, climbing a handsome 9.6% for the quarter. Bonds also posted positive returns as interest rate pressures began to subside. It was generally a quarter of good news, with one big zinger at the end: the US government shutdown, which perpetuates as of the writing of this commentary. We explore a number of surprises that emerged in recent months, positive signals looking forward, and a few meaningful short-term risks that the fourth quarter entails. Read More
June brought a bumpy landing to the second quarter as the Federal Reserve Board (Fed) signaled likely tapering in its bond buying program, and news from China raised liquidity concerns for the second largest world economy. US stocks, the starlets of 2013, managed to retain significant YTD returns. Dividend paying stocks retreated as bond yields became more attractive, but US stocks on the whole remained rather resilient. Looking elsewhere, returns turned negative among international stocks (largely emerging markets), bonds and commodities alike. Read More
The S&P 500 and Dow Industrial Average indices posted fresh all-time records in the first quarter, as both indices boasted double digit returns in just a short three months. US stocks were ‘the place to be’, while many other investment areas were far more muted. The international equity markets offered a modest 3% return, with Japan as the big winner and emerging markets (primarily Brazil) as the laggard. The aggregate bond market was slightly negative as interest rates moved higher. Commodities were mixed, but slightly negative; in large part due to a pull back in gold. Overall, it was a rewarding first quarter, but with wide variations in performance among various types of investments. Read More
Pleasant surprises materialized for investors during 2012, after a lackluster 2011. The prior year’s European debt crisis and fiscal concerns persisted, yet the investment markets rejoiced in the wake of much negative news. In fact, 2012 was dubbed ‘risk-on’ as the riskiest sectors enjoyed the largest returns. Domestically, the beleaguered financial and home building sectors posted the strongest performance while utilities fell to the bottom rank. Perhaps the largest surprise was in Europe, where Greece (yes, Greece!) captured the highest stock market gain. Read More
The third quarter of 2012 provided handsome returns to risk-seeking investors, despite weak economic data that surfaced throughout the quarter. The Dow Jones Industrial Average added more than 500 points as investor sentiment substantially improved. International stocks also enjoyed strong growth, including among beleaguered European countries. Bond investors felt a little upside, but it was muted in relative terms, effectively helping to cover inflationary effects. With substantial year-to-date returns across major stock markets, the question as we look forward is can returns continue, particularly at the same pace? Read More
The opening quarter of 2012 was the finest quarter for U.S. stocks since the late 1990s; the second quarter was a markedly different story. After an all-but-flat April and an abysmal May, stocks finally managed to advance in June, much of which happened on the last trading day of the quarter when renewed hope emerged from Europe. The second quarter wasn’t as bad as it could have been, but institutional and individual investors contended with plenty of bumps in the road. These bumps reflect a continuing struggle to achieve recovery and growth against numerous headwinds. Read More
Spring arrived early in 2012 with a remarkable surge among world stock markets. In fact, it was the best first quarter for the U.S. stock market since 1998. Bonds on the other hand, posted stagnant returns as interest rates inched higher. The resurgence in equities reflects a sharp change in investor sentiment and regained confidence that the economy might not fall into the dire state that people began to expect throughout 2011. The reality is that many of the significant challenges of 2011 persist today; however, monetary actions in Europe have likely averted the most worrisome of outcomes. Read More
It was a frustrating year on Wall Street, but the fourth quarter of 2011 was a real turnaround from the third. However, the stock market still posted a subpar year due to incredible events including an earthquake, tsunami and nuclear meltdown in Japan, riots throughout most of the oil-producing Arab world, the first ever downgrade of the United States’ credit rating, and spreading debt problems throughout the European Union. The resilience of our U.S. markets throughout this period is somewhat astounding. Following is a look at significant developments of the quarter, including improved economic indicators, and thoughts moving into 2012. Read More
The third quarter was difficult for equity investors as stocks suffered the largest declines since the first quarter of 2009. Double digit losses occurred throughout worldwide stock markets.
What is notable is that these events did not mirror economic or corporate results. Rather, they were instigated by a lack of political decision making, with political divides leading to the first ever downgrade to our U.S. Treasuries and to a worsening debt crisis in Europe, namely in Greece. Read More
For the first time in four quarters, U.S. stocks did not advance. The S&P 500 lost 0.39% in second quarter as investors reacted to European debt concerns, the conclusion of the Fed’s quantitative easing program, high gas prices and indications that the recovery was stalling. Yet as June ended, encouraging domestic indicators and better headlines from overseas helped to renew the collective appetite for risk. Returns in the last week of June virtually erased losses that occurred during the quarter, allowing major equity indices to remain in positive territory for the year. Read More
No forecast for 2011 came close to the events unfolding in just the first quarter. Tensions in Tunisia unleashed widespread social unrest throughout North Africa and the Middle East, with ongoing conflict and military action. Catastrophic natural disasters in Japan shifted the earth’s axis and left the world on the edge of a possible nuclear disaster. Coupled with a worsening debt crisis in Europe, you might be surprised by the fact that world markets managed to post positive investment performance. Read More
What amounted to be a choppy year fortunately finished with investor holiday cheer. Investment markets posted positive across-the-board returns among equities, bonds, real estate and commodities, rewarding those who held confidence throughout a number of challenges such as the BP oil spill, the May 6th Flash Crash, a mortgage foreclosure debacle, political turmoil and the continuing European debt crisis. All in all, a second year of recovery has further strengthened the economy and allowed many investors to regain financial stability, offering a strong start and outlook as we move into 2011. Read More
After a difficult start, the third quarter ended with a red-hot rally, bringing a much needed ‘Indian Summer’ effect to the markets. Equities significantly outpaced bonds for the month of September. This was an anomaly as September is one of the worst performing months by historical standards, and a reminder of how trying to time the markets based on trends can easily backfire. Year-to-date, bonds remain primary contributors to bottom line returns as the economy desperately tries to regain recovery momentum. Read More
The months of May and June cast grey clouds over the markets. The Greek debt crisis and the coinciding May 6th “flash crash” quickly erased early 2010 market gains. Ensuing debt contagion fears swathed much further than the so-called “PIIGS” (Portugal, Italy, Ireland, Greece and Spain). The effects put broad government debt burdens under scrutiny, brought future economic recovery into question, and ultimately forced equity markets into negative territory for the year. Read More
World equity markets started the year with gusto carried over from 2009, but were quickly set back when the Greek debt crisis surfaced. Investors are still trying to determine the short and long-term impacts of mounting Greek debt and around the world. These concerns did not prove significant enough to halt the recovery process. The balance of the quarter offered steady, strong results that brought domestic equities back into positive territory and allowed international equities to end the quarter essentially flat. Read More