Archive for 'June 2014'

    Be a Rollover Achiever

    June 30, 2014 2:30 PM by Brian Dobbis

    Rollovers have propelled IRAs to the largest segment of the $23 trillion retirement industry. There are plenty more rollover assets for financial advisors to capture—if you know where to look.


    Owning an IRA is a powerful way for your clients to save and preserve their retirement assets. Contributions to IRA rollovers alone amounted to $324 billion in 2013.  Rollovers are the prime reason IRAs are now the largest slice of the retirement pie, with assets totaling more than $6.5 trillion, as of December 2013.1

    For advisors who want to own a piece of this action, it’s essential to know when a 401(k) plan distribution is ripe for rolling over.

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    U.S. Economy: The Muddle Gets Deeper

    June 25, 2014 2:31 PM by Milton Ezrati

    While a far larger-than-expected decline in revised first-quarter GDP does not signal recession, it does point to continued subpar growth.  

    Though a downward revision in first-quarter U.S. gross domestic product (GDP) was widely expected, the actual change reported by the Commerce Department on June 25 was more severe—and troubling for that reason alone. Instead of the previous estimate of a 1.0% annualized rate of decline in real GDP reported on May 29, the revised data revealed a 2.9% decrease. Economists surveyed by Bloomberg projected a 1.8% drop.

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    The Road to Retirement Starts Here

    June 23, 2014 9:54 AM by Brian Dobbis

    There’s much at stake—and plenty of opportunity for advisors savvy enough to seize it.

    The road to retirement is long and winding. It’s easy to take a wrong turn and sometimes difficult to get back on route. But it is a journey that your clients have to take, regardless of their sense of direction, if they are to arrive at their desired destinations on schedule. Increasingly, investors are looking to their financial advisors to provide clear road maps.

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    The Fed: More Rate-Hike Clues

    June 18, 2014 5:15 PM by Zane Brown

    The central bank’s more upbeat assessment of the economy and the labor market, along with new interest-rate projections, reinforces expectations of a fed funds hike in 2015.

    With the Federal Reserve’s tapering effort firmly on track, investors focused on the June 17-18th meeting of its policy-setting arm, the Federal Open Market Committee (FOMC), for any hints as to potential interest-rate hikes in 2015. Investors didn’t get the “smoking gun” they were looking for—that is, a definitive indication as to the timing and size of a rate hike—but they got some information on the Fed’s view of key inputs into such a decision.

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    Oil Spillover: Could the Iraq Conflict Dampen U.S. Growth?

    June 16, 2014 4:05 PM by Milton Ezrati

    Expectations of stronger second-quarter growth may have to be trimmed if gasoline prices rise sharply.  

    Given the deepening conflict in Iraq, it is remarkable that oil prices have not risen higher than the $107 per barrel (Bloomberg data) reached on June 16.  Whichever side has the advantage-—the government of Prime Minister Nouri al-Maliki, or the insurgency led by the Islamic State of Iraq and Syria (ISIS)—or whether the United States or Iran, cooperatively or unilaterally, intervene in the conflict, the prospect of ongoing fighting and chaos threatens to keep some or all of Iraq's ample oil supplies off the market. 

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    Treasuries: Supplying Answers to the Yield Question

    June 12, 2014 11:00 AM by Zane Brown

    The decreasing supply of U.S. government debt is a likely cause of the recent Treasury rally. But this trend may be nearing its end. 

    Why have U.S. Treasury yields dropped since the beginning of 2014? Explanations abound. Most address increased demand for Treasuries emanating from concerns about a weakening U.S. economy, a jump in geopolitical risk, pension funds and insurance companies opportunistically snapping up government debt to match liabilities, or Treasuries’ attractive yield relative to those in other developed countries. A more convincing explanation may be the reduction in supply of Treasury debt on the market.

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    Turning the Lights Up on Utilities

    June 11, 2014 3:57 PM by Glenn McIsaac

    If you want to know what has powered the S&P 500, check out utilities, one of the top three performing sectors since 2004, with an average annual return of 10.4%. 

    In their search for total return, many investors have fallen in love with utilities stocks. And who could blame them? Over the past decade, the utilities sector has been one of the top performing components of the Standard & Poor's 500 (See Chart 1) due to solid earnings growth (an average compound annual growth rate of 4%) and declining interest rates.

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    Growth Investing: Defensive for Now, But Focused on Long-Term Market Leaders

    June 3, 2014 5:00 PM by F. Thomas O'Halloran

    The most innovative companies still appear to be well positioned to be market leaders for the rest of the decade.  

    It takes a strong stomach and a lot of humility to invest in growth stocks. The key is anticipating when momentum has shifted or is about to turn. That's when high-fliers can go from price spikes to "falling knives." You don't want to catch them on the way down.

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