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FINSUM

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Friday, 16 April 2021 17:27

Here’s What’s Wrong with Small Caps

(New York)

The market has been on a tear recently, but you wouldn’t know it from looking at small caps. Despite the broader rise in indexes, the Russell 2000 has not hit a fresh high in a month. Investors are wondering why, and the reason is pretty clear: inflation fears. Small caps are not seen to have as much pricing power as their larger peers, so as input costs rise, they get hit with lower margins.


FINSUM: There is nice clear and succinct reason why small caps have been underperforming over the last month. The good news is that inflation fears are subsiding, which means small caps should rebound accordingly.

(New York)

The stock market has been on one of the most historic recoveries in market history, but…see the full story on our partner Magnifi’s site

(New York)

Roblox (RBLX) the children's hybrid social media/video game platform received nothing…see the full story on our partner Magnifi’s site

(Silicon Valley)

Consumers spent more at online stores last year than the previous year by a staggering $900 billion…see the full story on our partner Magnifi’s site

(New York)

Retirement has never been so insecure. Part of the appeal of annuities has been as a strategy to offset the decline in pensions. Yet, if you dig deeper there is another good utility for annuities that some retirees and pre-retirees are using: as a bridge to getting social security. Many lower income retirees hit a wall where they only have tens of thousands to low hundreds of thousands of dollars when they turn 60. The issue is that if the claim Social Security early, they can grossly lower their income versus waiting a few years. Given that the average 60 year-old male right now is expected to live to 88, the difference of $500 a month really adds up. Accordingly, in this situation an annuity—such as an immediate annuity—can work very well, as it buys time for retirees to defer taking Social Security.


FINSUM: This strategy can make a ton of sense, but it takes some convincing as most retirees don’t want to part with their money even if they know it will give them more security.

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