Reflecting on a year gone by is often, at least to some extent, an exercise in revisionist history. This isn’t necessarily a bad thing; many of the differences between our memories and experiences are minor and inconsequential. In some cases, the variations in these realities can help us persevere and move out of the past and into future endeavors. But as investors, revising the memories of the past can be problematic and potentially hinder future success. Behavioral finance is the study of ... [Continue Reading]
Articles and resources related to Economy.
Our recommended reading today is a throwback to March 27, 2019, when we published Why We Won’t Panic Because the Yield Curve Inverted (And Neither Should You). In that post, we shared a number of reasons why we advised against reading into a yield curve inversion too deeply. One reason we cited was that while a yield curve inversion had a strong track record of predicting recessions in the U.S. over the past 60 years, the evidence internationally was less convincing. Another reason ... [Continue Reading]
Research demonstrates that over the past 50 years, every U.S. recession may have been predicted ahead of time by using one simple indicator--the spread between short and long-term government bonds. Usually, long-term bonds offer higher yields than short-term bonds due to the additional risk that an investor assumes when buying bonds with longer maturities. However, every once in a while the dynamic flips, where short-term government bonds offer higher yields than long-term government bonds. This ... [Continue Reading]
Opportunities are everywhere, if you know where to look. Our investment team is constantly looking for opportunities in your portfolio, both to add value and to reduce risk. The strong market rally in 2017 presented us with numerous opportunities to "tend the garden" of our clients' portfolios and make adjustments where need be. The most significant opportunity that has emerged over the past year is the growth in our clients' stock positions, which has shifted the mix of stocks and bonds ... [Continue Reading]
The Dow Jones Industrial Average had its largest decline in history on Monday, February 5--dropping 1,175 points! The headlines practically wrote themselves and were too exciting not to print. This was the largest single day decline in history, as long as we’re measuring in points and not percentages. By that measurement, Monday's drop wasn’t even the biggest decline in this decade. In addition, the 4.6% slide wasn’t significant enough to register within the top 20 daily declines and, of course, ... [Continue Reading]