- Thoughts On Another Plunge
While we had a nice reprieve on Tuesday and a more-or-less non-eventful conclusion to Wednesday’s trading, stocks headed south again on Thursday, with the 4%+ losses on the Dow hitting quadruple digits for the second time this week. The S&P 500 fell “only” 3.75%, with the latest setback pushing the drop from the highs set […]
- Monday February 5th Selloff
Thoughts on the Plunge As long-term-oriented investors, we have learned to ride through the inevitable bouts of volatility, secure in the belief that stocks will reward our patience in sticking with them through thick and thin. Such has been the case throughout our four decades of publishing The Prudent Speculator and since the dawn of the equity […]
- Friday February 2nd Selloff
In a sobering reminder that stock prices can move in both directions, the Dow Jones Industrial Average plunged more than 665 points (2.54%) on the last trading session of the week (February 2nd), while the S&P 500 skidded 2.14%. The week as a whole was awful, with the Dow tumbling 4.11%, the S&P 500 sinking […]
- 2017 Has Been Hard on Value Stocks – Long Live Value Stocks
The numbers are clear. Growth stocks have performed well1 in 2017 while Value stocks have lagged2 Forbes Editor, John Dobosz, interviewed John Buckingham at the MoneyShow San Francisco3. He started the interview with a pointed challenge; “Being a value guy, defend yourself! “Valuations matter. At the end of the day we think that companies trading […]
- What’s the Problem With Tech Stocks? It’s Not a Single Category.
The problem with the term “Tech Stocks” is the way the term is used in investing. Apple, Alphabet, Microsoft, Amazon, and Facebook are five of the six most valuable companies in the world. All are tech stocks. But AFAM Capital is only invested in two of those five currently. That doesn’t mean we don’t like […]
- The Most Wonderful Time of the Year
No, it’s not the parties for hosting or the marshmallows for toasting or caroling out in the snow. With apologies to Andy Williams, it’s the most wonderful time of the year because the calendar has rolled over to November, heralding the start of historically financial good cheer. November to April is the seasonally favorable period […]
- Time to Talk Turkey About Estate Planning
You know the drill. Pile the family in the car/plane. Rush to get to destination. Get there late, which really turns out to be early. Eat copious amounts of butter, bread, bird, beef. Relax on the couch long enough for someone to remember the annual Thanksgiving family football game. Then the discussion on the disposition […]
- Will Robos Kill The Portfolio Star?
Do you remember the advent of MTV? Why would you simply listen to music, when you could experience it with visual storytelling? Who can forget gathering around the (very large, thick) TV to watch the original walking dead of Michael Jackson’s Thriller? Or removing one’s glacier glasses to get a closer look at Duran Duran’s […]
- Should I Move My Investments to Fixed Income, Dividend-Paying Stocks, or Cash?
You may be looking at the stock market and asking where you should put your money. You might think the market is overheated and want to move to cash. You may be nearing retirement and feel like you should move to fixed income or bond-type investments. Perhaps you’ve heard us talking about dividend-paying stocks and […]
- Black Monday – 30 Years Later
It began in Hong Kong when 11% of market value vanished. When European markets opened, they were also hit hard; an 8% drop in Germany, a 9% tumble in France and a 10% plunge in the United Kingdom. Finally, the U.S. markets opened and lost 22% of their value in a single day. The date […]
- When is Staying in Cash a Good Idea? When You Have a TON of it to Play With
You have $100 billion in cash. How do you invest it? That may seem like a good problem to have, but it is actually more of a challenging question than you realize. It’s been reported that Warren Buffett is sitting on a pile of cash. Some people have taken this as a sign that they […]
- Are We in a Bubble? Is the Market About to Crash?
Like many investors, you may be wondering if we’re in a bubble and how to figure out if the market is about to crash. There’s no shortage of articles out there taking one stance or the other. And yes, we are going to add to the pile and take our stance. “Far more money has […]
- Dividend Paying Stocks in Rising Rate Environments
Dividend Paying Stocks in Rising Rate Environments You’ve probably heard the financial press proclaiming that the rally in stocks has to be doomed, given that the gains enjoyed since the end of the Financial Crisis have all been predicated on the “easy-money” monetary policy of the Federal Reserve. Through August 7, 2017, the broad-market S&P […]
- Capital Gain Tax Mitigation in Investments
You don’t like to pay taxes. Nobody likes to pay taxes! Like most people, you probably dread the month of April because you have to deal with the hassle of taxes, and you may be wondering if there are ways to pay less. One of the things to learn more about is capital gain tax […]
- What Do I Invest in If I Think Interest Rates Will Rise?
There has never been a shortage of worries when thinking of investing your money: terrorism, epidemics, politics, economic worries, and countless other potential pitfalls. Worries about what to invest in if you think interest rates will rise is no different. While there is no such thing as a list of investments that are guaranteed to […]
- Financial / Asset Management Fees or Commissions? What’s the Best Way to Pay?
There is no one right answer to this question. It all depends on your relationship preferences, investing style, amount to invest, time horizon, risk tolerance and other factors. This is the last in a three-part series on the different ways investment management firms charge their clients. In the first two blogs, we talked about commission-based […]
- How and Why Financial / Investment Management Firms Charge Fees
This is the second blog in our series about the different ways that financial management firms charge their clients. In the first blog, we talked with AFAM Capital expert Chris Creed to learn more about commission-based charges and how they work. Now we continue the conversation with him to help investors like you who may […]
- What Does it Mean to Have a Commission-based Financial Advisor?
We come across many investors who have questions about financial management fees. It can get especially complicated with the different ways that different firms charge their clients. To help you learn more, we interviewed one of our AFAM Capital experts, Chris Creed. Chris has been in the financial services industry for over 24 years and […]
- How Do Your Biases Impact Your Investments?
Who, me? Biased? If someone calls you biased in the wrong context, those can be fighting words. But the reality is we all have biases – including when it comes to investing. For example, have you heard about the hot-hand fallacy? How about herding or the optimism bias? Then surely you know about the disposition […]
- 23 Questions You should Ask Before Hiring a Private Wealth Manager
Whether you are new to investing or have been socking away funds for years, the decision to get outside help may seem like a daunting process. Luckily, we put together this common-sense, step-by-step guide to researching your options. There are many titles when it comes to financial professionals – financial advisor, financial manager, private wealth […]
- Diversification is an Investment Strategy to Manage Risk
You’ve heard some of these before. Buy low, sell high! Use the Iron Condor! Sell in May, Go Away! Watch the Groundhog! (I made that last one up…) Except for the reference to Puxatawney Phil, these are all investment strategies people turn to in order to increase returns or reduce risk. Investment risk can be measured using […]
- Growth vs. Value Stocks – Which Has the Best Track Record?
More than 4,000 companies are traded on the major stock exchanges in the United States, and another 15,000 or so are traded off the major U.S. exchanges. It is challenging to determine which ones might grow into valuable companies versus which ones might be duds. There are many categories of stocks, but our favorite is […]
- Unraveling Your Retirement Savings Options
Times have changed. Gone are the days of the bespectacled, white-haired gentleman wearing a three-piece suit, placing a comforting hand on your shoulder and saying, “Trust me, we will take care of your retirement.” Today’s investor is savvier. Caution is abundant after Y2K, Bernie Maddoff, the Financial Meltdown of 2008, etc. Despite some harrowing events […]
- Fee-based Austin Financial Asset Managers – Aligning Our Goals to Yours
Austin, Texas is hot, both literally and figuratively. By now, you have probably seen it on some “best” lists. Forbes recently named it the #1 “next biggest boom town in the U.S.” Already the 11th largest city in the U.S., the capital city is rapidly expanding. As residents and fee-based Austin asset managers, we are […]
- Most Undervalued Stocks for 2017 – From Value Stock Pickers With a History
Who doesn’t like to find great deals? Especially in stock picks? Being bargain hunters at our core, we get it. In reality though, there is no broad definition of “the most undervalued stocks”. Even so, we can certainly share some of our current favorite undervalued stocks for 2017, and the process we use to decide […]
- Difference between a financial manager and a private wealth manager
You are not alone if you’re unsure about the difference between a financial manager and private wealth manager. You’ll find a bevy of labels and terms out there regarding financial professionals who work with individual clients. These terms – which can include Financial Advisor, Financial Manager, Financial Planner, Asset Manager, Private Wealth Manager – don’t […]
- PASADARM: A Time-Tested Value Investing Strategy
Don’t worry if you’re racking your brain for all the acronyms you know and are coming up short. When it comes to PASADARM, you are in the very large majority. Our founder, the late Al Frank, coined the term PASADARM to refer to his value investing strategy. Forty years later, we believe it still holds […]
- Getting Started With Tax Efficient Investing
There are two things guaranteed in life: Death and Taxes. While maintaining a healthy lifestyle can seem complicated, we’d argue that understanding the IRS Tax code is even worse. Do you feel like you know for certain that your investment accounts are maximizing their tax efficiency? If so, kudos to you. If you want to […]
- Should I Reinvest Dividends? Two Reasons We Don’t
You’ve probably heard many times that you should always reinvest dividends, but you may have also heard reasons not to always automatically reinvest dividends. Ultimately, you should make the right choice for your own investing, which includes understanding the pros and cons. There are two reasons we don’t reinvest dividends that you might consider when […]
- Is Individual Stock Picking Dead? Buckingham Responds
The following is a transcription of Carol Massar and Cory Johnson interviewing John Buckingham on Bloomberg Radio. The interview took place on October 18, 2016 in New York. Highlights from interview There will always be a market for individual stock pickers “We’re overweight in technology” because of long term growth potential If you want to […]
- Negative Interest Rates and What They Mean to You
You may have heard about negative interest rates in the media and wondered how they might affect your portfolio. In simple terms, when interest rates are negative, it means that instead of receiving interest on your deposits, you must pay the bank to hold your money. Sounds shocking, right? The reality is that market forces […]
- Department of Labor’s Fiduciary Rule
The Department of Labor’s fiduciary rule mentioned in our January 7th letter was issued in its final form yesterday. As a refresher, the intent of the rule was to expand the types of retirement investment advice covered by fiduciary protections, preserve access to retirement education, theoretically reduce conflicts of interest, and provide for certain carve-outs […]
- Don’t Believe Everything You Read
Not surprisingly, we do not put a lot of stock into the proclamations of the press, though we point out that history shows that a plethora of pessimistic pennings often coincides with favorable times to be adding to one’s equity exposure. For example, the Out of Ammo? cover story in the February 20 edition of […]
- Anniversaries, Announcements, and Advice- Celebrating 39 Years!
Happy Anniversary to us! It is hard to believe that we are now in our 40th year of publication for The Prudent Speculator newsletter. March 10, 1977 is a day we will forever remember because it is the inception date for our original portfolio, TPS Portfolio, and the newsletter itself. In honor of this anniversary, […]
- Celebrating 75 years
The 75th anniversary of just about anything connotes celebration, longevity, dignity, and depending upon your search engine results, gifts of either diamonds or platinum. Odds are there was no parade of well-wishers bearing gaily-wrapped packages at the offices of the Securities and Exchange Commission last week, but they acknowledged a momentous occasion regardless. On September […]
- 25 Undervalued Stocks For Those Who Think Volatility is a Friend to the Long-Term Investor
Well, that was quick. After stating in our Prudent Speculator commentary last week that even though the preceding week’s ugly selloff was brutal, the pullback had not reached the “correction” level of 10% on the S&P 500, a global stock market rout, led by continued concerns about China, and a wave of panicked sell orders […]
- Apple- A Test in Patience
A message from our Al Frank Value division. We believe Apple offers a fine illustration of one of the most important facets of our investment philosophy, patience. Long-time fans of Apple, we are consistently impressed by the ability of the firm to grow revenue and earnings. In the third fiscal quarter of 2015, the consumer […]
- Why do we like BMR? | Part 2
A message from our Al Frank division: Besides the fact that we like the industry BMR operates in and that it is one of the few major players in the specialized life science REIT space, we believe that the current valuation is attractive relative to its own historical valuation measures as well as those of […]
- An Inexpensive Life-Sciences Stock Pick | Part I
A message from our Al Frank Value Division: Are you looking for a new stock pick? Check out this inexpensive, income-producing life sciences pick. What is BioMed Realty Trust? A mid-cap real estate investment trust (REIT) that leases, develops, constructs, redevelops, acquires, finances and owns space utilized by the life science community (with over 18 […]
- Cyber Security
After several high profile hack attacks at well-known firms, “cyber security” has received a fair amount of space in recent headlines. AFAM Capital has previously shared information about how we and various custodial firms strive to protect client information. The U.S. Securities and Exchange Commission recently released an Investor Bulletin (http://investor.gov/news-alerts/investor-bulletins/investor-bulletin-protecting-your-online-brokerage-accounts-fraud) with a concise and […]