August kicked off with some market turmoil and any hopes of a late summer lull were quickly dashed. However, by month end, the market had rebounded as investors began to price in more aggressive policy easing by the Federal Reserve (Fed). Here are 3 things you need to know: The S&P 500 was up for the 4th month in a row (+2.4% in total return terms). The Magnificent 7 continued to be a drag,...
In May there was a generally positive picture across the board after what was a challenging April. Here are 3 things you need to know: The S&P 500 was up +5.0% (total return) and hit another record, but the rally continued to be a narrow one. For example, the Magnificent 7 rose +9.1%, but the equal-weighted S&P 500 was only up +2.8%. It was a very strong month for several precious...
Concerns mounted around inflation and geopolitics in April. The March Consumer Price Index (CPI) report came in stronger than expected, with many of the usual suspects driving the bulk of this strength. In our opinion, stalling progress on disinflation limits the likelihood of a Fed rate cut in June, although underlying disinflationary trends should allow inflation to march lower over the course...
More than ever, we are seeing individuals begin to show more interest in investing in alternative investments. Alternative investments can be hard to define but for the sake of this article, we will focus on Private Equity, Real Estate investments, and other non-traditional investing options. These investments are more complex than traditional investments like stocks and bonds and are therefore...
Markets closed November in a positive mood thanks to tentative signs of economic moderation in the U.S. and falling inflation across developed markets. Here are 3 things you need to know: The S&P (+9.1%) saw the best month since July 2022, and reversed three months of losses. It was the best month for the Bloomberg US Bond Aggregate Index (+4.53%) since May 1985. Real estate’s (U.S. REITs)...
Wall Street closed out a winning April after more companies said their profits at the start of the year weren’t as bad as expected. Here are 3 things you need to know: US real GDP rose 1.1% annualized in the first quarter, 0.8% below consensus expectations. While below expectations on the surface, a deeper look reveals a degree of underlying resiliency. Much of the slowdown can be attributed to...
Despite the banking-sector turmoil seen in March, the S&P 500 rose in March, helped by strong returns from growth stocks that were buoyed by falling bond yields. Here are 3 things you need to know: The Federal Reserve continued to hike interest rates by 25 bps in March bringing the Federal funds rate range to 4.75% to 5.00%. U.S. Fed Chair Jerome Powell admitted, the current bank stress will...
2022 is not a year on which I shall look back with undiluted pleasure. In the words of one of my more sympathetic correspondents, it has turned out to be an 'Annus Horribilis'. May the New Year 2023 be more prosperous. Here are 3 things you need to know: The S&P 500 index was off (-19.4%), the worst yearly decline since 2008.Long-term treasuries were down (-30%) as interest rates rose the...
By: Paul Horn, CFP®, CPWA®, Senior Financial Planner As the final part of the series, we look at Employee Stock Purchase Plans (ESPP). Although these are not explicitly for executives, this is an important benefit that is not well understood and often underutilized. In case you missed Part 1 on Deferred Comp plans and Part 2 on Stock Options, read here and here, respectively. Employee Stock...
As we wrap up 2022, it’s important to take a closer look at any year-end investment decisions that could result in substantial tax savings. In terms of investment planning, investing in capital assets may increase your ability to time the recognition of some of your income and may help you to take advantage of tax rates that are lower than the ordinary income tax rates. You have the flexibility...
This short video discusses ambiguity aversion, just one of the many biases and habits that lead to poor investing decisions. Why do we typically choose known outcomes over the unknown, even if the unknown has significantly more upside? BFSG Shorts: Ambiguity Aversion Disclosure: BFSG does not make any representations or warranties as to the accuracy, timeliness, suitability, completeness, or...
Christmas came early this year for the markets. The idea that falling inflation could mean that the end to the rate hiking cycle is not far off gave both stocks and bonds a boost. Here are 3 things you need to know: The October consumer price index (CPI) showed prices rose 7.7% from a year ago and 0.4% from the prior month, according to the Labor Department, both below expectations. Prices of...
“Men, it has been well said, think in herds; it will be seen that they go mad in herds, while they only recover their senses slowly, and one by one.” – Charles MacKay What is Herding Bias? In behavioral finance, herding bias refers to investors' tendency to follow and copy what other investors are doing. When markets are volatile, it could lead to behavior that is not fully rational such as...
Although this year has felt spooky, the U.S. stock market rallied in October after enduring several straight months of losses, leading to optimism that the end of the bear market may be in sight. Here are 3 things you need to know: The S&P 500 ended the month up 8%. Ten of the 11 sectors of the S&P 500 rose during the month, with energy stocks leading the way higher.Gilts (a UK...
How much "noise" is the media pushing out to us every day? And even more important, how often does this seemingly important "breaking news" that might impact markets today, actually have a long-lasting impact a long-term results? Find out more here and learn about recency bias, just one of the many biases and habits that lead to poor investing decisions. BFSG Shorts: Recency Bias Disclosure:...
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