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Annual Rebalancing Steps

Annual Rebalancing Steps: Perspectives from a Seasoned Financial Advisor As you begin to receive your year-end statements, it will be tempting to focus on how well the markets performed – because it really was a year for the record books. The year 2017 saw the DJIA set 71 all-time highs, surpassing the previous record of 69 set in 1995. We saw NASDAQ up 28%, the DJIA up 25% and the S&P 500 up 19%. And at almost nine years old, this bull market is now the second-oldest and second-strongest in history. Given last year’s market performance, it would be a safe bet that many investors need to consider rebalancing, because they might now be overweight or underweight certain asset classes – and therefore positioned in a way that is inconsistent with their risk tolerance and goals. Now is the Time to Think About Rebalancing The reality is that the market …

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New England Patriots vs. Philadelphia Eagles: Does the winning team predict the direction of the stock market?

Is there actually a difference in the annual performance of the stock market, depending on who wins the Super Bowl? Should I really consider altering my investment plans based on who wins? Let’s explore this interesting consideration as we approach Super Bowl LII (or Super Bowl 52 if you didn’t take Latin in high school). The Super Bowl The inaugural Super Bowl took place in January 1967. The Green Bay Packers, who had already won several NFL championships in that decade, beat the AFL champion Kansas City Chiefs. The Super Bowl developed so that the NFL (National Football League) champions could play the AFL (American Football League) champions. The NFL started in 1920, while the AFL began its first season in 1960. Before the 1970 season, the AFL joined the NFL, forming the NFC (National Football Conference) and the corresponding AFC (American Football Conference). To even out the number of …

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What Impact Will the New Tax Policy Have?

While Republicans are touting a victory in the passage and signing of the Tax Cuts and Jobs Act, it will take some time before most changes go into effect. And with all the sweeping changes in the law, tweaks and fixes are likely in the coming months, experts say. “It’s important to remember that it could be years before the IRS does its interpretation of the tax changes and even longer, if ever, before those interpretations are tested by courts,” says Steven Weil, Ph.D., president and tax manager of RMS Accounting, an accounting and bookkeeping firm. “There are sure to be errors, and corrections that Congress will have to make. How long these will take and how many there will be is anyone’s guess.” In the meantime you may see a few changes sooner, depending on some variables. It Depends on How You File One of the main changes is …

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Bonding With Your Portfolio

Nearly all investors realize the importance of diversification to the investment process. Many may not be as familiar with the importance of asset allocation— dividing your portfolio into the appropriate mix of stocks, bonds, and cash. Although assets can also include real estate (homes, vacation homes, and rental properties) or business ownership, the most widely held asset classes are stock, bonds, and cash. In a strong economic climate, the potential for gain when stocks perform well opens up. Typically, most people who invest in the stock market also see value in having a liquid cash reserve set aside for emergencies and larger expenditures. But, what about bonds? Are they affected by economic swings and what are the risks involved? There is interest rate risk associated with investing in a bond or bond mutual fund, referred to as an inverse relationship. This means that as interest rates rise, generally, prices of …

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Will Net Neutrality Impact Financial Planning?

Will Net Neutrality Impact Financial Planning? Perspectives from a Financial Advisor: You’re probably tired of hearing about, talking about and thinking about Net Neutrality. And I suspect your opinions on this topic are along ideological lines. But from my perspective as a financial advisor, the idea of repealing Net Neutrality is worrisome. Let me explain. As most know, “Net Neutrality” is the basic principle that prohibits internet service providers (like AT&T, Comcast or Verizon) from slowing down, speeding up or completely blocking content, websites or web-based applications you and I want to use. Let’s Ignore the Free Speech Issue for a Second I don’t want to get into a divisive discussion about whether Net Neutrality enables and protects free speech. Nor do I want to debate how much Net Neutrality will devastate certain communities that cannot afford to pay. And I don’t want to get into an argument about whether …

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