Displaying items by tag: volatility

Wednesday, 15 December 2021 20:31

Investors are Looking to Annuities for Security

A new study by Alliance for Lifetime Income and CANNEX is shaking the foundation of the standard portfolio construction which uses 60/40 equity bond split to simultaneously grow and protect/provide income. Investors in hypothetical allocation, 20% of their portfolio into equities 14% into real estate and annuities made up the next largest category of 13% followed by CDs, bonds, and alternatives. This overwhelming support for annuities is interesting but even more intriguing iis that nearly 85% of investors were interested in a lifetime guaranteed income annuity or already own one. Advisors should hear their clients desires for annuities rather than push the traditional portfolio allocation. The increased interest in annuities is a growing trend for investors and will be a more prominent feature in the average portfolio.


FINSUM: The pandemic and the current financial landscape has upended what many investors thought of as a safe asset, and guaranteed income (even at a cost) is worth it for many.

Published in Wealth Management
Thursday, 21 October 2021 07:41

What is Hedged Equity?

Hedged equity is an increasingly popular term in investing. But what exactly is hedged equity? How can you use hedged equity in a portfolio? What are examples of hedge equity strategies?...see more on our partner's site

Published in Eq: Total Market
Thursday, 07 October 2021 20:12

Why Volatility Is Here to Stay

September saw the Vix creep to a 4-month high as the S&P 500 blew off 4.8% of its value. Most investors were hoping for a bounce-back month in October, chalking up September’s poor performance to a checkered history for the opening of autumn. However, they are likely to be remiss as volatility indexes are still climbing. The pullback in September was the largest since March of 2020, when the pandemic began.BofA said that while October is generally a well-performing month when it trails a struggling September, October can drag as well. Debt ceiling negotiations, oil price spikes, and Fed tapering are just a few of the onslaught of headlines which are giving the market fits.


FINSUM: While volatility has yet to hit the peaks of September it is already consistently above its 200-day moving average, which could be a sign of even more volatility to come.

Published in Eq: Total Market
Wednesday, 06 October 2021 20:19

Fed May Cause Volatility Jump

Federal Reserve Bank Chairman Jerome Powell spoke last week on a panel hosted by the ECB, and relayed his frustration about the ongoing inflation pressures in the US economy. Powell said the economy’s most important concern is getting people vaccinated and containing Covid’s delta variant. Powell said the key inflationary pressures remain supply chain bottlenecks in the US economy. These supply constraints have the U.S.’s key inflationary measure (core personal consumption expenditure) elevated to its highest level in 30 years. The FOMC has raised their expectation for inflation from 3% to 3.7%, and Powell said this could continue into 2022. Powell’s Analysis was backed up by both Japan and the ECB’s respective leaders.


FINSUM: The supply shock to the economy remains as chip shortages still persist. As long as supply chains remain disrupted the unemployment/GDP and inflationary goals of the Fed will remain in conflict.

Published in Bonds: Total Market
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
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