Just about all of my clients are long-term, retirement oriented investors. The most frustrating thing the past few years for long-term investors is how the central banks have largely “killed” the markets in the traditional investment sense. What I mean by “killed” is that I cannot honestly consider bonds yielding less than 2% and stocks…
Say Hello to Your New “Synthetic” Corporate Bonds
Investors have been “starved” for yield for years now and unfortunately interest rates aren’t going up anytime soon. When looking at individual bonds, investors get to choose between high quality bonds at paltry yields or junk-rated bonds that look attractive but come with a slew of bad risks that often aren’t understood or appropriate for…
Chart of the Week: Not a Good Sign for Global Stock Markets
The chart below was going around a lot last week. It shows a composition of AP Moller-Maersk (the world’s largest container shipping company) and Sotheby’s (the auction house of high-end art, etc.) in blue vs. the MSCI World Stock Index in orange. That’s a pretty tight correlation and a pretty wide gap we’re seeing right…
“Phase 3” Right Around the Corner for Stocks
For those of you that read my latest letter to clients (which I’m sure everyone did…but if you haven’t had a chance yet, you can find it here), the S&P 500 is about to enter what I consider “Phase 3”. This means it’s time to aggressively hedge/reduce stock risk. I spent a good bit of…
Market Updates
Well that was exciting! Please keep in mind that, as a long-term investor, what matters is the earnings power and yield of the companies in which you are invested. Just because the price of a stock drops doesn’t mean that the underlying company is deteriorating – it simply means you have the chance to buy…
Portfolio Update: Options & Volatility
I wrote in my letter to clients earlier this year that the only thing I’m certain about in the markets moving forward is that volatility will be higher than the past few years. As we move further down the path of currency wars and central bank policy divergences, there are some large risks looming overhead…