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Mitigating the financial and emotional impact of market volatility

In the wake of the great financial crisis, an improving economy and unprecedented monetary policy bolstered asset prices and suppressed market volatility. Many who benefitted from this trend assumed that it would continue indefinitely. However, that assumption was shattered by the recent turbulence across global financial markets. We believe the era of low volatility may…
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Crash Ahead?

This rather shocking directive is actual advice Royal Bank of Scotland (RBS) recently issued to its investment clients (minus the questions marks). The large Scottish bank predicts a “cataclysmic” year in 2016 (akin to 2008) in which stocks fall by more than 20% to bear market territory and oil falls into the mid teens, down…
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The Fear Gauge

Vexed Over Vix The financial media seems to be making much ado these days about an obscure index known as the VIX.  At times the VIX even overshadows the venerable S&P 500 from which it is indirectly derived.  The media refers to it as the “fear gage” because the VIX is designed to reflect how…
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Without FANG this Market isn’t worth a DANG

US stocks are poised to notch a seventh straight year of gains but there are signs this bull market may be long in the tooth (pun intended). One cause for concern is the lack of "market breadth”.  This occurs when the market's performance is driven by only a narrow sliver of companies. The result is…
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October Frights – Congressional Trick or Treat?

Be afraid, be very afraid.  Or not*** Congressional dysfunction may give investors a couple of scares this Halloween season. First up, congress must raise the debt ceiling before or on November 3rd.  If it does not the Treasury says it is tapped out and cannot borrow any more money.  This would result in at least…
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Inflation, inflation, where art thou inflation?

The Federal Reserve took no action at its September 2015 meeting, leaving the federal funds rate about as low it can go at 0% to .25%.  The Fed cited uncertainty over international economic conditions and low inflation in the US for why they again postponed beginning the “normalization process” of raising interest rates.  The decision…
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Wall Street’s Fuzzy Math

Mark Twain famously lamented, “lies, damn lies, and statistics”.  Perhaps today his lament would be, “Wall street charts and graphs”? Twain’s quote comes to mind whenever the “Best Days Chart” appears in the financial media as support for a “buy and hold” strategy.   The typical version illustrates what would happen if an investor misses just…
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How to keep your head when all about are losing theirs.

During the recent market turmoil financial pundits have dished out plenty of advice.  Some claimed because we were overdue for a bear market investors should sell at the first opportunity.  Others asserted that stocks were “on sale” so now is the time to buy.  Splitting the difference, others said “don’t panic” and just stand pat. …
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Do ETFs live up to the Hype?

Exchange Traded Funds (ETFs) are among the fastest growing investments in the US.  Often described as “mutual funds that trade like stocks”, ten years ago there were barely 200 ETFs with a total of $300 million   Today there are over 1,400 ETFs holding ~$2 trillion dollars covering a dizzying array of categories and niche…
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