Monthly Archives: January 2017

POCKETBOOK: Week ending Jan.28, 2017

  • 7be6974a-a70c-449c-b75f-92ef077bf8a2 Markets hate uncertainty

Funny thing about the stock market: On the one hand it looks ahead, on the other it doesn’t like uncertainty. Or, social unrest and there is plenty of that going on.

So, with a new President in town, and one who takes bold actions and is hard to figure, investors would be wise to expect a fair amount of market volatility going forward. Also, that life is going to be more expensive on a number of fronts for individuals and the country.

Re the country, expect more debt.

Even though the GOP is no fan of debt, President Trump has been called the King of Debt. Which is okay when your kingdom is a privately held corporation. But not so okay when you are a public servant.

  • Market Quick Glance

It was a week of ups and downs and the Dow Jones Industrial Average closing over 20,000. How long the DJIA stays at the level—and continues upward– is anybody’s guess.

Below are the weekly and 1-year performance results for four popular stock indices based on the close of business prices at the close of business on Friday, Jan. 27, according to Bloomberg.

-Indices:

-Dow Jones + 1.78% YTD up from last week’s 0.43%

  • 1yr Rtn +25.32% down from last week’s 26.53%

P/E Ratio 18.55 down from last week’s 18.66

 

-S&P 500 +2.60% YTD up from last week’s 1.55% YTD

  • 1yr Rtn +20.86% down from last week’s 21.73%

P/E Ratio 21.28 down a tad from last week’s 21.22

 

-NASDAQ +5.20% YTD up from last week’s 3.23%

  • 1yr Rtn +24.36% up from last week’s 22.65%

P/E Ratio 34.91 up from last week’s 34.39

 

–Russell 2000 +1.05% way up from last week’s -0.35%

  • 1yr Rtn +34.36% down a bit from last week’s 34.44%

P/E Ratio 48.27 up from last week’s 49.19

 

-Mutual funds

The average U.S. Diversified Equity Fund ended the week up with a year-to-date return of 2.61% at the close of business on Thursday, Jan. 26, 2017, according to Lipper.

Under that broad U.S. Diversified Equity Fund heading, it was Dedicated Short Bias Funds that lost the most, down on average 5.58%.They were followed by Alternative Equity Market Neutral funds, down 0.08%.

On the plus side, Equity Leverage Funds were up 7.52% nearly double the previous week return of 3.59%. Next in performance were Large-Cap Growth Funds up 4.81% followed by Multi-Cap Growth Funds, up 4.60%.

The average Sector Fund was up 2.73% up from 1.43%; World Equity Fund up 4.47% from 2.55%; and Mixed Asset Funds doubled their average return in a week to close at 2.10% from last Thursday’s close of 1%.

Visit www.allaboutfunds.com for more information about how various equity and fixed-income funds have rewarded investors over the short-and long-term, based upon Lipper data. Short-term meaning weekly and monthly performance returns; longer-term includes quarterly, year-to-date, 1-yr, 2-yr, 3-yr and 5-yr returns.

  • Actions have consequences

If there is one thing that President Trump’s slew of executive orders signed during his first full week in office has shown everyone,  it is that actions have consequences. They always have. They always will. Unfortunately the consequences part of that equation never really shows its head until after an action has taken place.

Take the executive order signed on Friday to stop travelers from seven countries coming to America. BTW, none of those countries were places that Trump has business relationships.

Clearly that action had political, emotional and economic consequences felt around the globe. I’m not sure if the administration had anticipated any of those consequences but am certain travelers and the general public did not.

Or the order signed to build a wall along the U.S. and Mexican border. One of its many consequences will be its cost.

One of the curious things about executive orders—other than their extraordinary power– is that when you really begin to think about them as actions, the first question a reasoning person has to ask themselves is “Why was it put in place?” and the second, “What purpose will it/they actually serve?”

Word is President Trump has a bunch of executive orders he is prepared to present and sign. As for what the consequences of each of those actions will be, the answer is: We shall see.

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POCKETBOOK: Week ending Jan.21, 2017

7be6974a-a70c-449c-b75f-92ef077bf8a2

•Bookies bets and recession realities

Wall Streeters aren’t the only ones who consider odds. Turns out the gambling world does too. According to Paddy Power, an online betting site, the odds of Trump not completing a full term as President of the United States is 7 to 4.

Additionally, the odds of Trump being impeached or forced to resign are 4 to 2; to split from Melania in 2017, 16 to 1; and to paint the entire White House gold, 500 to 1.

On that last point, Trump has made quite a dent with that gold thing. Seems this golden-haired guy has already had gold curtains installed in the Oval Office along with a gold rug and who knows where else you’ll find his golden touch.

While gold may be his thing, color the entire economic picture of the United States of America gray as the likelihood of a Trump recession during his tenure in office is 100 %.

As I wrote a few weeks back, there has been a recession during every single Republican president’s administration since World War II.

  • Market Quick Glance

In case you’ve forgotten, there were only 4 trading days last week—Monday was the Martin Luther King holiday and markets were closed. Oh, and there was the inauguration of our 45th President–a holiday for some.

So it was a four-day Wall Street week and as it turned out, not a great one for investors with the indices all  closing  lower than they had the week previous.

Below are the weekly and 1-year performance results for four popular stock indices based on the close of business prices  on Friday, Jan. 20, according to Bloomberg.

-Indices:

-Dow Jones + 0.43% YTD down from last week’s 1.07%.

  • 1yr Rtn +26.53% up from last week’s 23.63%.

P/E Ratio 18.66 up from last week’s 18.80.

 

-S&P 500 +1.55% YTD down from last week’s 1.67%.

  • 1yr Rtn +21.73% down from last week’s +23.63%.

P/E Ratio 21.22 up from last week’s 20.36.

 

-NASDAQ +3.23 YTD down from last week’s3.57%.

  • 1yr Rtn +22.65% down from last week’s 25.87%.

P/E Ratio 34.39 down from last week’s 34.47.

 

-Russell 2000 -0.35%YTD way down from last week’s +1.13%

  • 1yr Rtn +34.44% down from last week’s +38.0%.

P/E Ratio 48.13 down from last week’s 49.19.

 

-Mutual funds

Average year-to-date returns were lower at the close of business on Thursday, Jan. 19, 2017, as the average U.S. Diversified Equity Fund ended the week up 0.94%, according to Lipper ( it closed on 1/12/17 at 1.38%).

Even Equity Leverage Funds were off at 3.59% from the previous week’s  4.62% average return. Large-Cap Growth Funds were a tad off at 3.11% from their 1/12/17 showing of 3.13%.

The average year-to-date  Sector Fund was up 1.43%; World Equity Fund up 2.55%; and Mixed Asset Funds ahead by 1%.

Visit www.allaboutfunds.com for more information about how various equity and fixed-income funds have rewarded investors over the short-and long-term, based upon Lipper data. Short-term meaning weekly and monthly performance returns; longer-term includes quarterly, year-to-date, 1-yr, 2-yr, 3-yr and 5-yr returns.

  • Fidelity stock fund managers and the stocks they like.

Ever now and then I get  an email from Jim Lowell, editor of Fidelity Investor, an investor advice newsletter.

In the one received on Jan. 22, he listed Fidelity’s Top 20 Favorite Stocks that he wrote were

“ the most owned, and hence most liked, by Fidelity’s top managers.”

While I can’t verify that. Or, don’t know the date when the list was compiled or when they were gleaned precisely from where, or if those holdings are still in portfolios, I did find the list interesting and thought you might too.

With that in mind, the list of 20 includes:

#1) Alphabet (GOOG)

#2)Apple(APPL)

#3) Facebook (FB)

#4) Amazon (AMZN)

#5) iShares ETFs

#6) Microsoft (MSFT)

#7) Berkshire Hathaway (BRK):

#8) Visa (V)

#9) UnitedHealth Group (UNH)

#10) Medtronic (MDT)

#11) Salesforce (CRM)

#12) Amgen Inc. (AMGN)

#13) NVIDIA Corp (NVDA)

#14) JP Morgan Chase (JPM)

#15) Wells Fargo (WFC)

#16) Activision Blizzard, Inc. (ATVI)

#17) Home Depot (HD)

#18) Chevron (CVX)

#19) MasterCard Inc. (MA)

#20) QUALCOMM Inc. (QCOM)

 

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A great day for a rally

Thousands of women — and a few good men–showed up for the Palm Beach County Women’s March –Local  Rally– at the Meyer Amphitheater in West Palm Beach, Fl. today (1/21/17).

No marching, however. Just a good ole peaceful political rally in a magnificent setting where  Pete Seeger’s songs were sung and their lyrics heard loudly and clearly.

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POCKETBOOK: Week ending Jan.14, 2017

  • 7be6974a-a70c-449c-b75f-92ef077bf8a2•Where’s the beef?

Whether you want to admit it or not, the vast majority of Americans don’t have enough money to fully finance life during their retirement years or cover any out-of-the-blue expenses today.

For anyone who has believed soon to be President Trump’s “Make America Great Again” slogan, when it comes to making money and it having a positive difference in one’s life, that privilege will continue to go to the  top 1%ers and not the majority of working Americans.

And, until the huge spread between the incomes of those at the top of the income heap vs those in the middle and the bottom is significantly reduced, that’s how things will remain going forward. Period.

So, for the nearly 60% of Americans who, according to a report from Bankrate on CNNMoney.com, don’t have $500 to $1000 to cover an unexpected expenses, ‘great again’ ain’t gonna happen.

Bottom line: Expect life going forward to be more expensive than it is today.

 

  • Market Quick Glance

We’ve lived through a second week of market action and low and behold, things have changed: While the major indices all had YTD returns on the plus side of the scale, not all were higher.

Below are the weekly and 1-year performance results for four popular stock indices based on the close of business prices at the close of business on Friday, Jan.13, according to Bloomberg.

-Indices:

-Dow Jones +0.68%YTD down from last week’s 1.07%

  • 1yr Rtn +23.63% down from last week’s 25.44%

P/E Ratio 18.80 down from last week’s 18.96

 

-S&P 500 +1.67%YTD down from last wee’s 1.76%

  • 1yr Rtn +23.63% up from last week’s 21.08%

P/E Ratio up from last week’s 20.36

 

-NASDAQ +3.57%YTD up from last week’s 2.58%

  • 1yr Rtn +25.87% up from last week’s 20.51%

P/E Ratio 34.47 up from last week’s 34.39

 

-Russell 2000 +1.13%YTS up from last week’s 0.76%

  • 1yr Rtn +38.0% up from last week’s 32.67%

P/E Ratio 49.19 down from last week’s 49.42

 

-Mutual funds

Not much changed in Mutualfundland by the close of business on Thursday, Jan. 12, 2017 as the average U.S. Diversified Equity Fund ended the week up 1.38%, a hair lower than it had the previous week (1.39%), according to Lipper.

Equity Leverage Funds were a bit weaker but still the strongest of the lot, up on average 4.62% (last week 4.73%). Large-Cap Growth Funds showed their muscle, up on average 3.13%.

Looking only at the performance of the 25 largest mutual funds, the Fidelity Contrafund was up 3.21%, the Vanguard Total Stock Index (institutional), up 3.02% and the Vanguard Total Stock Index (investors), up 2.99%.

Visit www.allaboutfunds.com for more information about how various equity and fixed-income funds have rewarded investors over the short-and long-term, based upon Lipper data. Short-term meaning weekly and monthly performance returns; longer-term includes quarterly, year-to-date, 1-yr, 2-yr, 3-yr and 5-yr returns.

  • Martin Luther King

Acknowledging the two sides of celebrating the MLK holiday begins with honoring the extraordinary works and accomplishments of Dr. Martin Luther King. And, accepting the reality that racism in America is still very much alive and exists.

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POCKETBOOK: Week ending Jan.7, 2017

IMG_0204•It’s time to go to Europe

Lots of talk about the strength of the U.S. Dollar and one major sized plus of its current value that’s not getting much attention is that your greenback will buy more when traveling across the pond.

So, If you love Europe and would like to take advantage of exchange rates —on currencies such as the euro and British Pound Sterling— their exchange rates are attractive.

Given that exchange rates are always changing, as of Jan.9 around 9:30 a.m., here’s a look at the EUR-USD rate 1.0528, according to Bloomberg. And the BPS (GPS-USD) rate of 1.226.

Flipped those exchange rates read like this: EUR, 0.95 and GBP,0.815.

Happy spending and safe travels.

 

•Market Quick Glance

The first week of the New Year was off to a positive start for all four indices followed. And that’s the good news.

The uncertain news is what’s to follow.

With an economy that some say is heating up and other’s cooling down, inflation a concern for all and a new president with a bullying style and

not always known for keeping his word, what’s in store for Wall Street in 2017 is anyone’s guess.

I’m hoping for the positive.

On that note, below are the weekly and 1-year performance results for four popular stock indices based on the close of business prices  on Friday, Jan.6, according to Bloomberg.

-Indices:

-Dow Jones +1.07% YTD

  • 1yr Rtn +25.44%

P/E Ratio 18.96

 

-S&P 500 +1.76% YTD

  • 1yr Rtn +21.08%

P/E Ratio 20.36

 

-NASDAQ +2.58% YTD

  • 1yr Rtn +20.51%

P/E Ratio 34.39

 

-Russell 2000 +0.76% YTD

  • 1yr Rtn +32.67%

P/E Ratio 49.42

-Mutual funds

The New Year brought with it positive results for the average U.S. Diversified Equity Fund, too. At the close of business on Thursday, Jan. 5, 2017, the average return for the 8,471 funds that come under that broad heading was up 1.39%, according to Lipper.

Curiously, it was Equity leverage Funds, there are 200 of them tracked, that scored the best—up on average 4.73%. The lowest returns? Specialty Diversified Equity Funds, up 0.73% followed by last year’s winner, Small-Cap Value Funds, up 0.96%. In 2016, Small-Cap Value Funds’ scores were the highest with the average return up 27.25%.

Visit www.allaboutfunds.com for more information about how various equity and fixed-income funds have rewarded investors over the short-and long-term, based upon Lipper data. Short-term meaning weekly and monthly performance returns; longer-term includes quarterly, year-to-date, 1-yr, 2-yr, 3-yr and 5-yr returns.

 

•Vanguard brings in big big bucks

If you’ve ever wondered where some investor money is going, it’s to the Vanguard Group. They are the largest mutual fund manager around and in 2016 brought in $305 billion beating their 2015 take of $276.4 billion.

According to Vanguard representative, John Woerth, most of that money went into Vanguard index funds although about $50 billion made its way into that fund family’s actively managed stock and bond funds.

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Why DJIA didn’t hit 20,000 yesterday

bjcgdm-mjl0-andy-bealesMarkets don’t like risk. Or political, social and economic unrest. Or any threat of terrorism— be it perceived or real.

So here’s how I saw yesterday’s market activity:  On Friday, January 6,  right after 1 in the afternoon —-just as the champagne corks were about to pop and celebrations were about to begin on Wall Street as the DJIA was cozying up to the  wildly anticipated 20,000 marker— another more important event  was also going on: At the Ft. Lauderdale Airport in Florida,  in the baggage claim area, one disturbed individual had taken out his gun and was shooting and killing innocents.

In case you may have forgotten, risk happens fast. Changes in the direction of the markets  do too. And no matter if it’s the bulls or the bears that appear to be running Wall Street, what’s behind their strength  are the social, economic and political risks of the day.

If there are  lessons to be learned from January 6th’s horrible incident. let the first be about the realities of making money. And the more important second,  a reminder of the frailties of life.

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2017 Dogs of the Dow

 

pexels-photo-167804It’s Dogs of the Dow time again: A time when buying into a 1-year high-dividend paying investment strategy has proven rewarding for fans of stocks included in the Dow Jones Industrial Average. Like any investment strategy, however, results change from year to year and that’s okay. Nothing on Wall Street has ever been profitable year after year after year after year.

Keeping that bit of reality in mind, forgive me for being a few days late in getting this list of the 10 bow-wows to you. That said, the info below includes the 2016 closing price for each of the companies along with its yield at that time and was all gleaned from a recent 24/7WallStreet.com story.

A little bit of current history, the DJIA ended 2016 at 19,762.60 representing a gain of 13.4% from it’s close in 2015, according to that same source. But what’s ahead for Wall Street and the DJIA in 2017 has everyone scratching their heads.

And from 24/7WallStreet.com comes this: “The average yield for the 2017 Dogs of the Dow is almost 3.6%, down slightly from 2016 but closer to 2015’s Dogs. This 3.6% would compare to a yield of 2.44% for the 10-year Treasury and 3.06% for the 30-year Treasury. Note that all 10 Dogs of the Dow for 2017 currently out yield the 10-year Treasury by more than a full percentage, and they even out yield the 30-year Treasury by a half-percent on average. Most Dow stocks are expected to have stable earnings growth in the years ahead. There are technically 11 Dogs of the Dow, unless you back out the rounding issues.”

On that note, here are 2017’s Dogs:

Verizon
 Yield: 4.33%. Shares of Verizon closed out 2016 at $53.38.

-Pfizer
Yield: 3.60%. Shares of Pfizer recently closed at $32.48.

Chevron
Yield: 3.73%. Shares of Chevron last closed at $117.70.

-Boeing
Yield: 3.65%. Boeing closed at $155.68 at the end of 2016.

-Cisco Systems
 Yield: 3.44%. Cisco shares closed out 2017 at $30.22.

-Caterpillar
 Yield: 3.41%. Caterpillar shares closed out 2016 at $92.74.

– Coca-Cola
Yield: 3.38%. Shares of Coca-Cola closed out 2016 at $41.45.

-IBM
Yield: 3.37%. Shares of IBM closed out 2016 at $165.99.

-Exxon Mobil
Yield: 3.32%. Shares of Exxon Mobil closed out 2016 at $90.26.

-Merck

Yield: 3.19%. Shares of Merck closed out 2016 at$58.87.

There’s more information about each of these companies in the story titled “Meet the 2017 Dogs of the Dow: Massive Dividends and Expected Upside” written by Jon C. Ogg at http://247wallst.com/investing/2016/12/31/meet-the-2017-dogs-of-the-dow-massive-dividends-and-expected-upside/print/

 

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POCKETBOOK: Week ending Dec.31, 2016

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  • It’s all about the numbers

If you were in the stock market in 2016, odds are you made money.

According to CNNMoney, 77% of investors made money. How much? OpenFolio reported that the average investor enjoyed a 5% increase in the value of their investments.

Unfortunately, men’s portfolios outperformed those owned by the ladies, reports that same source. Which, BTW, is nothing new. That trend has been going on for the past three years. Oh my.

  • Market Quick Glance

The chart at the top of this blog sums up the performance of the indices in 2016  very nicely with one exception: It’s missing the performance of the Russell 2000—- it  ended the year up a whopping 19.48%, according to CNNMoney.com

Here are a very few of the best and worst performing stocks in 2016:

  • The top performing stock in the DJIA was Caterpillar, up 36.46%, according to CNBC.com. The worst, Nike, down18.67%.
  • The best performing stock in the S&P 500 was Nvidia, up 224%, and the worst was  Endo International, down 73.1%, according to Salon.com.

Although no one knows how the markets will perform in the short-term, as in 2017, the  chart below, cockeyed as it is, shows how the DJIA has moved over the past 10 years, from 2007 through 2016.  (Source: It and the chart at the beginning of this blog are pictures  I took of charts  found at CNBC.com on Friday, December 30, 2016.)

A DJIA 10-year mountain chart:

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-Mutual funds

All was shiny and bright for many stock fund investors as at the close of business on Thursday, Dec. 29, 2016, the performance of the average U.S. Diversified Equity Fund was up 11.23%, off a bit from the previous week’s clost of 11.53%, according to Lipper.

Under that broad heading, Small-Cap Value Funds’ scores were the highest with the average return up 27.25%. Dedicated Short Bias Funds were down the most, off 25.69%.

Under the Sector Equity Funds heading, where the highest gains (and losses) are likely to be found, Precious Metals EquityFunds were the winners—up on average 58.53%. Biggest losing group? Commodities Specialty Funds, down 15.13%.

And, the average General Domestic Taxable Fixed-Income Fund ended the year up 7.47%.

Visit www.allaboutfunds.com for more information about how various equity and fixed-income funds have rewarded investors over the short-and long-term, based upon Lipper data. Short-term meaning weekly and monthly performance returns; longer-term includes quarterly, year-to-date, 1-yr, 2-yr, 3-yr and 5-yr returns.

•Hoping 2017 is a happy, healthy and rewarding one for all of us!

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