President Joe Biden outlined his tax proposals in his address to Congress on April 28th and issued an 18-page fact sheet, which can be found by clicking here. There are many proposals, but here are some of the items of note for individual investors: The top tax bracket would increase to 39.6 percent from 37.0 percent. In 2021, the top bracket began at $523,601 for single individuals and $628,301 for… Read More
Last week, the Wall Street Journal (WSJ) ran a gripping article about a mutual fund that blew up due to problems with derivatives in the fund’s portfolio. You can read the whole article by clicking here, but let me start by sparing you of wondering whether you have it: not with us; our portfolio management software doesn’t even recognize the ticker. The thrust of the story is that the fund,… Read More
I was planning a different article on life expectancy after reading about Prince Philip’s death at 99. I couldn’t have told you his name until I watched The Crown on Netflix and he was one of my favorite characters, especially in the first two seasons. I know it’s fiction, but I would never have read his obituary before watching the show. Instead, though, I fell down a rabbit hole looking… Read More
I’m proud to say that Acropolis was an early adopter of exchange-traded funds (ETFs). Although they had been around for almost ten years by the time we launched the firm, they were not actively used. In fact, five years before we launched Acropolis, I wanted to buy some in an account that I had with my dad’s broker at A.G. Edwards. I wanted to buy the S&P 500 ‘Spider’ fund… Read More
People frequently ask me if they should use contribute to their ‘regular’ IRA or their Roth IRA. I’m usually wishy-washy in my answer because it depends on a variety of factors, including things that are simply unknowable. Before getting into whether you should or shouldn’t consider the Roth option, let’s review the basics. A ‘regular’ 401k (as people often refer to it when talking to me), is the traditional savings… Read More
Over the last six months or so, small-cap stocks have enjoyed one of their strongest periods of relative performance in history. In the five months that ended in February, the S&P 500 is up 14.1 percent, which is a terrific return, but the S&P 600 Small-Cap index, is up 50.3 percent, which is tremendous. This month isn’t over, so it’s too soon to say for sure, but as of Friday,… Read More
Last week, I looked at some of the investor concerns about inflation, noting that inflation expectations had jumped recently (you can read the full article here). As the economy comes out of the covid-induced recession, the government is still responding aggressively, which has some investors concerned that there will be too much money chasing too few goods, leading to higher prices. This week, I promised to describe some of the… Read More
Although some of the weakness was thought to be technical in nature, it is also the latest chapter in an ongoing tough market for bonds amid rising inflation expectations, a reasonably strong macro-outlook, solid corporate earnings, improving covid trends, and expectations for continued fiscal stimulus. Only energy posted a win for the week, up 4.3 percent. Utilities and consumer discretionary stocks were down -5.0 percent respectively, and technology fell by… Read More
Outside of last week’s look at the state of the economy, most of these Insights of late have been about trading, mostly thanks to the bizarre price action of GameStop and normally obscure parts of the market, like SPACs (click here, here, or here to see these articles). Two weeks ago, the focus was on getting good ‘execution,’ which means getting good prices when we trade. Execution, and some of… Read More
Vanguard has always provided balanced and thoughtful commentary about the economy and markets. In the last few years, they’ve done an even better job of producing it regularly and making it easy for advisors to access. Today, I’m sharing a client-approved document that they produced that is easy-to-read and sets a great baseline for thinking about 2021. The title says it all: Approaching the Dawn. Although I encourage you to… Read More
