(New York)

Not only is the broker protocol collapsing underneath the feet of advisors, but a new court ruling has just set a precedent which will likely make it harder for advisors to switch firms. A recent ruling by the Georgia Court of Appeals says that advisors who have agreed in a contract to give advance notice of departure, but then do not, are not covered by the Broker Protocol. The case stemmed from a smaller firm, Aprio Wealth Management, making a claim against a group of advisors who moved to Morgan Stanley. “We’re really pleased with the court-of-appeals ruling on this case … We think it’s a very meaningful decision for small and midsize firms, especially for registered investment advisers that can feel confident they’ll be protected from poaching like happened to us”.

FINSUM: The bottom line of this story seems to be that one needs to make sure to give appropriate notice. However, that is not always be easy as there might be extenuating circumstances.

(New York)

Despite all the fears over a trade war, recession, and bear market, there has been relatively little media chatter surrounding gold. Gold is usually seen as a good hedge to political and market calamity, and while it has seen some gains, there isn’t the usual excitement that surrounds it. All of that may be good news, however, for stocks as the spread between gold and platinum suggests the equity bull market has more room to run, according to a pair of professors from Cornell and USC. The gold-platinum ratio reflects both industrial demand and investor anxiety, and when it is high, it tends to indicate that stocks will perform well.

FINSUM: There are a lot of factors that go into the price relationship between two commodities, so it is hard to draw a conclusion for a third asset class. That said, the logic underlying this argument seems sound.

(New York)

Investors turned heavily towards income-producing stocks prior to Trump’s presidency. With yields so low, they offered income which was very hard to find elsewhere. More recently, though, high yielding stocks have been losing out as rates move higher. This has caused an exodus from some areas, such as telecoms, which have lost 16% over the last 18 months. However, one important thing to bear in mind as one watches yields fall on stocks is that this is often caused by rising prices. For instance, yields have fallen in six S&P 500 sectors over the last 18 months, but the market has returned 25% in that time frame—a nice pay off for losing some yield.

FINSUM: The key point of this very basic article is to remember that falling yields in equity can mean that the sector is doing very well.

(New York)

There has been a lot of media attention over the last year about the rise of faith-based and politics-based investing. New ETFs and advisors are currently cropping up to cater to investors who would like to invest based on these principles. However, Barry Ritholtz thinks the concepts may not be a good mix. The author looks at the returns of a popular biblical-based fund and finds that its performance lags broader indices significantly. Ritholtz argues that investors need to check their emotions at the door when investing, which is why this kind of philosophical investing may not create good returns. Ritzholtz says “Do your civic duty on Election Day and vote, go to church on Sundays, but always bring a cool unemotional detachment to investing on Mondays”.

FINSUM: The fees on these types of funds also tend to be much higher, which means that you are losing on both ends. That said, the peace of mind people get from investing in things they feel morally comfortable with may be greater than the expense.

(New York)

Only those watching the bond market closely would have noticed it, but a huge Treasury meltdown may have started yesterday. One month US Treasury bills saw yields jump an eye-popping 10 basis points in an instant. The incident followed one of the worst Treasury Bill auctions in a decade, where there was little demand from investors. The two possible answers for the terrible auction are the unusual date (it was moved because of the Fourth of July), or that China has indeed slowed or cut off its purchases of US debt.

FINSUM: The US better hope this bad auction was just a fluke of the calendar. That view is supported by the fact that longer-term Treasury auctions at the same time were much closer to normal.