News Mentions & Press Releases
The stock market’s 3% drop Tuesday provides the latest proof that volatility is back. But the recent gyrations in major stock market indexes doesn’t tell the full story of what’s happening inside client portfolios.
While marquee benchmarks like the Dow Jones Industrial Average and the S&P 500 are getting all the attention, it’s the normally steady fixed-income component that is wreaking the most havoc on portfolio performance.
The S&P 500 is still up 2.8% from the start of the year, but the Bloomberg Barclays Aggregate Bond Index is down 1.3%, which will be dragging portfolios below the closely watched S&P.
One year ago, I published a piece highlighting Three Undervalued ETFs you’ve Never Heard Of. Since then, luckily, all these ETFs are still open for trading, and two have performed quite well. Asset growth has been OK, with CRAK taking the cake. (Tough to say whether it was my analysis, pure investment merit, or the ticker symbol that really propelled that one forward!) Portugal has yet to realize its value, but hey, at least it’s not Turkey.
While not completely striking out on these previous recommendations, I’ll take the momentum from those selections and continue my quest to uncover the hidden gems across the ever-growing ETF ecosystem. Let’s take a look at three more ETFs that have been overlooked, undervalued, or undiscovered that investors may want to take a second look at.
We’ve seen this scary movie before. In 2000 and then again in 2008: The market starts to crater and retirees and those on retirement’s doorstep start to panic as they watch their nest egg decline in value and along with it their standard of living.
On the one hand, they want/need to stay investing in stocks. But on the other hand, they want to protect their principal. What to do? What asset allocation do advisers suggest? What sectors/stocks offer downside protection with upside potential? Here’s what advisers had to say.
Of course, it should go without saying but it also bears repeating that the key to any investment strategy, at any point of the investment life cycle, is in developing a specific plan and following it, period, says Christian Hyldahl, president and chief investment officer of Varium Investment Partners.
Anxiety is an occupational hazard, a fact of life, for professional traders. After all, even on good days, something is always going wrong, somewhere.
But when everything starts to go wrong at once, imaginations can run wild. Like now, when everywhere you look, something’s blowing up. In commodities, it’s the record plunge in oil. In equities, it’s six weeks of turbulence in the S&P 500. Debt markets have been rattled by the turmoil engulfing General Electric and PG&E. Bitcoin just plunged 13 percent. And Goldman Sachs, the storied investment bank, is having the worst week since 2016.
By themselves, none would be enough to incite panic. But have them erupt all around and even the most grizzled Wall Street types can start to sound paranoid. Does GE have something to do with Goldman? How does Bitcoin sway the stock market? Wildfires have nothing to do with crude’s convulsions, but both are bad news for banks.
Investors seeking to diversify a traditional equity portfolio may consider market factors and the effects of combining various factors into a multi-factor strategy.
On the recent webcast (available On Demand for CE Credit), How to Use Single- and Multi-Factor Strategies in Every Portfolio, Mo Haghbin, Head of Product, Beta Solutions at OppenheimerFunds, highlighted the shift in the marketplace, outlining the current increase in volatility driven by a confluence of monetary tightening, a higher inflationary trend, and the introduction of tariffs.
Consequently, investors could look to alternative investment strategies like factor-based investments to help smooth out a bumpy ride. Greg Ellston, Director of Asset Allocation at Confluence Investment Management, also added that the nascent inflationary pressures triggered by more restrictive trade policies could foreshadow greater influence on equity valuations and on factor exposures.
The U.S. midterm elections are just around the corner, and investors remain concerned about how the results could impact the equity markets. The answer is simpler than many may think: The midterm elections have historically been positive for U.S. equities.
It may sound odd not to consider the election outcome, but that’s because it largely doesn’t matter. As famed investment analyst Ken Fisher noted, since 1926 the S&P 500 has generated positive returns 87% of the time in the nine months following the midterm elections, regardless of which party won or whether there was a change in the majority. He calls it the “87% miracle.”
This phenomenon comes down to the known versus the unknown. The market hates unknowns, and the results of the midterm elections provide clarity as to the political landscape for at least the next two years.
SMArtX Advisory Solutions (“SMArtX”), a leading financial technology and Turnkey Asset Management Platform (TAMP), today expanded the number of third party investment manager models offered on its UMA platform. SMArtX added 15 new strategies, and now features 159 firms offering about 450 strategies. The strategies include a full array of traditional long only, long/short equity, global macro, and direct indexes, all offered in an UMA structure.
The new firms and strategies include:
• CLS Investments: Focused ESG, Protected Equities, SMART Risk Budget 100 Aggressive, SMART Risk Budget 30 Conservative, SMART Risk Budget 40 Moderately Conservative, SMART Risk Budget 50 Moderate, SMART Risk Budget 60 Moderate, SMART Risk Budget 75 Moderately Aggressive, SMART Risk Budget 90 Aggressive
ESG (environmental, social, and governance) investing has been a hot topic lately. Asset growth has reflected this, picking up over the last couple of years. But growth has generally been on the institutional side (pensions and endowments), while retail clients and advisors have been slower to adopt. This seems strange given that younger generations are starting to save more for retirement and also have more interest in social issues than past generations. The disconnect may simply be a lack of education on the world of ESG investing. As an introduction, below I bust the three common myths of ESG investing and offer three important truths that should make ESG top of mind when considering investor solutions.
Myth No. 1: ESG limits diversification benefits.
ESG investors favor companies that exhibit positive attitudes and behavior toward the environment, social change, and corporate governance. By contrast, investing based on broad market-cap indices means favoring the most highly valued companies. So, without knowing anything else about ESG, investors already know they are getting something better valued than a broad index. Add in the higher-quality nature of ESG companies, and ESG looks even better. Diversification should be achieved by investing in various uncorrelated asset classes in a portfolio, not by benchmark hugging.
Psychology has infiltrated the field of financial advice and does not appear to be stopping its influence any time soon. This makes sense. With the popularity of outsourcing money management on the rise, many financial advisors are finding that their most valuable offering is the management of client behavior.
Every advisor seems to have his or her own story that underscores this point. The client temptations always vary — reaching into a 401(k) too soon, taking on unnecessary debt, dipping into savings, etc., but the image that advisors create is always the same: taking off their businessperson hat and playing the role of a psychologist.
CLS Investments, LLC (“CLS”), a third-party money manager and leading manager of exchange traded fund (“ETF”) portfolios, announced today that it won the 2018 WealthManagement.com Industry Award for ETF Strategist. Now in its fourth year, the WealthManagement.com Industry Awards is the only awards program to honor outstanding achievements by companies and organizations that support financial advisor success.
CLS was awarded ETF Strategist of the year for its Smart ETF Models, which utilize products from five ETF providers at a zero-percent strategist fee. These first-of-their-kind models focus on active and smart beta ETFs, which have historically demonstrated a bias to outpace the market over time. CLS manages these models with their disciplined and active Risk Budgeting framework, with a continued focus on the global market.
CLS also provides clear and consistent information to advisors and investors to strengthen conversations among the two parties and keep investors on course. CLS offers advisors and investors a variety of tools including innovative video statements, an engaging online portal, weekly multi-media commentary, and more. CLS manages nearly 45,000 investor portfolios through partnerships with over 6,000 financial advisors and 1,500 qualified plan sponsors.
This information is not complete without these disclosures: http://bit.ly/2xgYxMv