July 13, 2014
Top 100 baby names now include Khaleesi (Game of Thrones mother of dragons) and Katniss (Hunger Games) according to Nameberry. While fads are funny in baby naming, it can be dangerous in investing. So many people buy into the investment sector that was hot last year. But the time to buy that sector was last year, not necessarily now. Very often you are buying after much or all of the upside is already baked in. Sometimes you are even buying into a market that is ready to fall back to normal levels. Diversified portfolios keep you exposed to multiple sectors allowing you to catch the upside of each when it is their turn to rise. (Just for the record, the Social Security admin does not show Khaleesi or Katniss in their top 1000 names for new babies.)
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
Top 100 baby names now include Khaleesi (Game of Thrones mother of dragons) and Katniss (Hunger Games) according to Nameberry. While fads are funny in baby naming, it can be dangerous in investing. So many people buy into the investment sector that was hot last year. But the time to buy that sector was last year, not necessarily now. Very often you are buying after much or all of the upside is already baked in. Sometimes you are even buying into a market that is ready to fall back to normal levels. Diversified portfolios keep you exposed to multiple sectors allowing you to catch the upside of each when it is their turn to rise. (Just for the record, the Social Security admin does not show Khaleesi or Katniss in their top 1000 names for new babies.)
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
July 9, 2014
Is Gold valuable? Who says? Is it an inflation hedge? Will it have value if society turns to anarchy? James Glassman (in Kiplingers 07/2014) tells of data where gold often fails to simply keep up with inflation. And if we find ourselves in anarchy, who wants to carry around 100 pounds of gold? Oh, and by the way, production is up to 2,500 tons per year, a 100% increase from 1980, says Glassman. Maybe you like it for a small piece of your portfolio but there are a lot of ways to add assets to your portfolio that provide decent return and don't act like stocks or bonds.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
July 8, 2014
So you want a certain investment allocation, like 60% stocks, 30% bonds and 10% cash, or whatever is right for you. And then you buy actively managed mutual funds to hit those targets. But then whoops, it turns out that your actively managed fund is invested partially in something other then it's advertised portfolio or keeps a very high cash position. Loomis Sayles Bond Fund for example was 16% cash or very short treasuries at the end of April. So much for that target portfolio. (Index funds, on the other hand, tend to be very close to fully invested in their advertised assets.)
July 1, 2014
Which is more valuable? 100 shares of a stock worth $50 a share that you bought at $40? Or 100 shares of the same stock you bought at $60? (This is not similar to the question that asks whether a pound of feathers or a pound of rocks is heavier.) Hint: One of them has a valuable tax benefit.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
Which is more valuable? 100 shares of a stock worth $50 a share that you bought at $40? Or 100 shares of the same stock you bought at $60? (This is not similar to the question that asks whether a pound of feathers or a pound of rocks is heavier.) Hint: One of them has a valuable tax benefit.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
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