29
Sep
2014
Bill Gross, Meet Derek Jeter
When I first saw the headline on CNBC that Bill Gross was leaving PIMCO, I didn’t pay close attention because I assumed it was one of those headlines that didn’t have any facts but asks a provocative question, like ‘Is Bill Gross Leaving PIMCO?’ It’s almost an absurd question, but that’s exactly what happened on Friday after a series of bad public stumbles, some of which I’ve chronicled already (click… Read More
26
Sep
2014
Canaries in a Coal Mine: Stocks Sell Off
Since taking over Daily Insights last July 1, the market has gone up steadily at an annualized pace of 19.69 percent through the close of business yesterday. In addition to the substantial gains, volatility for the S&P 500 has been uncharacteristically low. Naturally, I’m appreciative that we’ve all been able to enjoy a straight-up market, but I’m also realistic and know that it won’t always be like this. It’s normal… Read More
25
Sep
2014
Retiree Spending
In our retirement planning model, the Acropolis Financial Forecaster, there are essentially five key variables that affect the probability of meeting your goals. They are as follows: Saving Before Retirement When to Retire Spending in Retirement Market Returns & Inflation Rate Portfolio Risk The first three factors are entirely under your control and the second one is the most critical because the timing of your retirement stops contributions to your… Read More
24
Sep
2014
Hedge Funds Flip-Flop
A recent examination of hedge funds by the Securities and Exchange Commission (SEC) found a variety of deficiencies in almost half of the firms examined, according to the Wall Street Journal. None of the findings were particularly surprising, but the SEC appears to create a new name for an old problem: flip-flopping (and not on a wind-surfer). The problem is that some securities, especially ones that are unique or illiquid,… Read More
23
Sep
2014
When Academics Go Bananas
You may have noticed already, but I constantly refer to academics and academia. As a firm, we put a lot of value on the ideas that come from the ivory towers and have academic support for nearly every strategy and sub-strategy that we employ. We appreciate the thoughtfulness, research, peer-review process that has contributed so much to the way we think about markets. But, sometimes, academics can get a little… Read More
22
Sep
2014
What if You Called The Bond Market Perfectly?
It’s an interesting question. The ability to call the tops and bottoms with perfect accuracy is considered the “holy grail” of bond market investing. We spend a great deal of effort talking to clients about the risk of trying to make speculative calls – the risk of being wrong of course. Just as an exercise I thought it would be neat to imagine what it would be like if we… Read More
22
Sep
2014
Alibaba vs. Amazon
Alibaba Group Holding (ticker: BABA) went public on Friday at a price of $68 per share, which valued the company at $168 billion, making it one of the 40 largest companies in the world, according to S&P Capital IQ. Once the stock started trading in the open market, however, investors bid the stock higher and it ended the day at almost $94 per share, valuing the company at $231.4 billion…. Read More
20
Sep
2014
Why Aren’t Interest Rates Higher?
With a lot of focus being put on the coming end to the Federal Reserve’s quantitative easing campaign, this article will delve into some of the other factors impacting interest rates in the US. The Federal Open Market Committee (FOMC) has maintained a steady course ever since Chairman Bernanke first hinted at the end of quantitative easing in the spring of 2013. The “Taper” which is scheduled to complete this… Read More
17
Sep
2014
ALM Insights – September 2014
ALM Insights is focused on banks and other institutions that use their portfolio to manage risk on both sides of their balance sheet. It takes an in-depth look at securities investment strategies, balance sheet and asset/liability strategies, regulatory topics and general economic information. To view this issue, click the image below. In This Issue: What if You Called The Market Perfectly? The Impact of Fed Tightening Why Aren’t Interest Rates Higher?
17
Sep
2014
ETF Deathwatch
Although the first exchange-traded-fund (ETF) hit the market in 1993, they really didn’t catch on until about 10 years ago. The first product ever is still one of the most popular, the Spider S&P 500 ETF Trust, which trades under the ticker SPY. When we launched Acropolis in 2002 there were 113 ETFs on the market with a total of $102 billion in assets under management according to data from… Read More