Displaying items by tag: volatility

Wednesday, 15 September 2021 19:28

Volatility is an Equity Ally

Chinese regulators have come after everything from internet companies to education platforms, and this has left many investors skittish. Investors that would have maintained their convictions would have been well-suited, as since mid-August Chinese internet companies have bounced. Over this same time frame the MSCI Emerging Market Index, which holds a large share of Chinese companies, has doubled the return in the S&P 500. China’s focus on future regulation will better promote growth moving forward. The structure formed may benefit semiconductor companies, smart manufacturing, alternative energy, machine learning, cloud computing, autonomous vehicles, and other internet-related companies. Finally, Chinese companies have been quick to undue overwrought regulation and long-term regulation will be moderate.


FINSUM: Investors shouldn’t be too fickle with China, don’t spend too much time trying to nail regulatory swells, and embrace the long haul.

Published in Eq: Asia
Tuesday, 14 September 2021 18:45

How to Stay Hedged in Times of Volatility

(New York)

A successful 8-month streak has put the market well above expectations, and there are reasons to still be optimistic, but the number of protection plays is growing on Walls Street. Whether it is a slowing economy, rising inflation, spreading delta variant, or tapering tantrum there are lots of reasons to stay protected which is why over $5 billion in inflows are headed to volatility-based protections. Funds like the Simplify Interest Rate Hedge ETF (PFIX) offer a direct hedge against a future of the interest rate market by placing a call on Treasury derivatives. A wider hedge against the ETF like the Simplify Volatility Premierm ETF (SVOL) which can generate a yield from swings in the Cboe Volatility Index. This hedge is less specific than the PFIX but it gives investors a bigger safety net in any of the scenarios above or unforeseen risks in the economy.


FINSUM: Honestly leave the bond hedges to the past as there is no return. Instead, SVOL and PFIX are hedges that will likely clip the Treasury return anyway and provide more relief in case equities go upside down.

Published in Eq: Total Market
Friday, 03 September 2021 09:52

How to Choose Annuities More Wisely

(New York)

The annuities market is healthy and doing well. According to Ken Burger, national sales director for annuities at Luma, “When you look at our current market environment of minimal low fixed-income yields, high levels of volatility, and fears of mounting inflation, it’s easy to see the attractiveness of the annuity category”. The issue for advisors though is that annuities have long been a complicated and crowded space that is too complex and time-consuming for advisors. That is where Luma is trying to expand the market, as they have a slick annuities comparison tool that allows advisors to easily compare annuities side-by-side.


FINSUM:Annuities are a great fit for the current market given ultra-low rates and the huge mass of Americans who are retiring. Check out Luma.

Published in Wealth Management
Monday, 09 August 2021 17:33

Big Risks Lurk in the Bond Market

(New York)

The bond market is in an odd place right now. For the first part of the year, yields jumped on the threat of inflation. Then in the middle of Spring, those fears started to wane and yields started to fall. Other than a quick reversal of direction off a hot June inflation reading, that has been the trend all summer. However, the whole market looks very vulnerable to a change in sentiment. If inflation comes in warm again for July—especially coupled with some very good jobs numbers—the overall economic picture might move back to bullish, which could swing yields rapidly back in the direction they were headed in Q1.


FINSUM: Essentially this market could quickly realized it mispriced the direction of the economy, so there is a lot of risk for advisors and their clients. Nasdaq and Fidelity are having an interesting webinar on how to plan for this risk. Check it out here.

Published in Bonds: Total Market
Wednesday, 28 July 2021 07:09

Are Millennials Buying the Dip?

(New York)

The stock markets have had some very small slumps but rebounded quickly in the last 12-months. The refusal to…see the full story on Magnifi’s site

Published in Eq: Large Cap
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