With stock markets at all-time highs, stock prices relatively high compared to earnings, and uncertainty related to the current administration, I want to discuss bear markets and market corrections.
Happy 2017. I’m back after a break from blogging and social media – since the Trump election. I was extremely disappointed with the results of the election and how Trump won. The entire election process is disturbing.
I spent some time thinking about how I can make an impact and I will continue to explore options and take the steps I can. Right now, I will focus on Socially Responsible Investing – community investing and shareholder advocacy.
Any change of president, especially with changing political parties, brings with it some industries will do better and those that will not do as well as they previously had. In addition, with Republicans in control of the White House and both houses of Congress, there will most likely be major tax reform in 2017.
In this episode I discuss what I learned from a recent conference for fee only financial planners. Many economists and fund managers spoke about their expectations for the markets. I heard many good arguments for diversification in an investment portfolio beyond stock and bond funds.
In this episode, I speak with Erica Lasdon (Sustainable Research Department) and Laurie Webster (Investment operations) at Calvert Investments. Calvert is one of the largest and most active Socially Responsible Investing (SRI) mutual fund companies. They have come out with some lower expense ratio index SRI funds.
In this episode, I speak with Keith Pettus with SQN Advisors. SQN offers an alternative investment, a limited partnership. They will raise $50 million dollars and will close the fund and open a new one. The fund is expected to run 5-7 years and the minimum investment is $25k. This fund invests in business necessary income producing equipment. They rent the equipment then effectively sell it. The fund pays 8% per year.
This podcast is an interview with Josh Vail from 361 Capital. 361 Capital is an investment management firm that is solely focused on liquid alternative investment (alternative mutual funds). They were founded as Hedge Fund of Fund in 2001 and managed money for ultra-high net worth individuals, foundations and institutions. They started to move to products with greater liquidity due client demand in 2006 and in 2009 starting packaging our “intellectual capabilities” into investments products that we available to all investors not just the very elite. Today they have four mutual funds some of which our managed in house and a long short fund that is managed by a Sub-Advisor that we’d know since our Hedge Funds days – Analytic Investors.
I spoke with a fellow financial planner at a recent professional meeting who used to be a day trader. He told me that he would have stretches of good success and then down times that would wipe out all of his gains. He said that with the high speed trading that goes on today, there is little room for profit for small day traders. He now follows an asset allocation approach.
Technology stocks hold the top three spots on this list of the largest companies in the US (by market capitalization). Market capitalization is the market value of a companies’ outstanding shares (the number of shares times the share price). Here are the top 20:
2015 has been a tough market for most stocks but there are some that have done well. Two stocks (Exelixis and Netflix) are up over 100% this year. The following is a list of the top returns for 2015 with their industry, year to date total return and the 5 year annualized total return.
Oil, gas and China have made the headlines recently for poor performance. Here is a list of how other US industries have done during the past 3 months, year to date (YTD), and annualized 5 year. While real estate (and Real Estate Investment Trusts (REITs)) are down over the last 3 month and year, they are ahead of the broader market. It is no surprise that oil and gas have lost the most over all three periods – basic material, technology and industrials have also had a rough 3 months.
Below is a list of how stocks in various countries are performing (total return) over the last 3 months, year to date (YTD), and annualized over 5 years. China has made all the headlines this last few weeks with their dramatic stock market drop, but you can see that China has done fine over a longer period of time (annualized 5 year return). Notice that Ireland has actually been positive during the past 3 months.