Monthly Archives: March 2019

POCKETBOOK Week Ending March 22, 2019

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  • Recession coming?

The bond market is signaling a recession could be in our near future and if that is the case, word is recessions typically last around a year and during them stocks don’t always perform horribly during one. The bugaboo in it all, however, is inflation: It and recessions are first cousins and no one is a fan of it. Then again, we’re already seeing price increases on plenty of the items we purchase thanks to the tariffs Trump has imposed.

Oh well, another day in the upside down, topsy turvery pretzel-like who-is-on-first world we all are currently living in.

But I degress.

Back to the recession subject.

From CNBC MarketInsider.com comes this: “As far as recession goes, our economist feels quite optimistic that a recession will be avoided, at least this year. The market is focused not only on U.S. fundamentals but also on what’s happening in China, what’s happening in the rest of the world and how likely it is that political uncertainty, whether through trade policy or whatever, how likely is that to persist and beget a recession,” said Mark Cabana, head of short U.S.rate strategy at Bank of America Merrill Lynch…..
“As recession signals begin to flash and recession probabilities increase, I would expect market participants and people who deploy capital will become more cautious and there’s a risk that it’s a self-fulfilling prophecy,” Cabana said.”

Okay then.

 

  • Pew Research’s not-so-bright future study returns

A recent Pew research report has shed light on some not-so-happy or inspiring future outcomes. In other words, looking out 30 years, things aren’t looking very rosy.

Below are a few of results from the Pew Research Center Social & Demographic Trends report dated March 21, 2019:

  • 7 in 10 Americans were dissatisfied with the way things are going in this country.
  • 60% of those interviewed say the U.S. will be less important in the world by 2050.
  • 73% think that the gap between the rich and poor will continue to grow.
  • 65% say the country will be more politically devided over the next 30 years.
  • And, the majority of those responding expect the economy to be weaker, health care less affordable, the environment worse and  that older Americans will have a harder time makes ends meet than they do now.

Oh my.

 

  • Market Quick Glance

A week of mixed year-to-date returns with 1-year returns up.

Below are the weekly and 1-year index performance results for the three major indices—DJIA, S&P 500 and NASDAQ — including the dates each reached new highs. Data is according to CNBC.com and based on prices at the close of business on Friday, March 22, 2019.

DJIA 9.32% YTD up a tad from the previous week’s 9.10%.

  • 1 yr. Rtn 6.45% way up from the previous week 2.23%

Most recent DJIA a new ALL-TIME CLOSING HIGH was reached on Oct.3, 2018 of 26,951.81. The previous high was reached on Sept. 21, 2018 of 26,796.16.

 

-S&P 500   11.72% YTD down from the previous week’s 12.59%

  • 1 yr. Rtn 5.94% way up from the previous week’s 2.74%.

The S&P 500 reached a BRAND NEW CLOSING ALL-TIME HIGH on Sept. 21, 2018 of 2,940.91. The previous closing high was reached on August 29, 2018 of 2,916.50.

 

-NASDAQ 15.18% YTD down a hair from last week’s 15.87%%

  • 1yr Rtn 6.64% up from last week’s 2.76%

Nasdaq reached a BRAND NEW 52-week CLOSING HIGH on August 30, 2018 of 8,1333.30. The previous high was reached on August 24, 2018 of 7,949.71.

 

-Mutual funds

The year-to-date cumulative total reinvested performance for equity funds that fall under the  U.S. Diversified Equity Fund heading was 14.26% at the close of business on Thursday, March 21, 2019, according to Lipper.

Among the 408 Mid-Cap Growth Funds that fall under that huge Diversified category, the average year-to-date return was an impressive 20.17%. Small-Cap Growth Funds, however, performed better: 20.37% for the 592 funds that Lipper tracks in that group.

And then there are Equity Leverage Funds—-the average YTD performance of the 228 funds under that heading was 28.36%.

On the other hand, Dedicated Short Bias Funds’ average YTD return was -20.61%.

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.

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POCKETBOOK Week Ending March 15, 2019

 

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Debts matter.

 

 

  • Surveys say….

J.D.Powers recently released data from two surveys and found, among other things, that boomers and pre-boomers  have concerns about their financial well-being, and, aren’t really that keen on mobile communications such as online/web and phone apps.

From the press release of the J.D. Power 2019 U.S. Full Service Investor Satisfaction Study comes this about the performance from their full-service investment providers: ““Three-fourths (75%) of Boomers and Pre-Boomers indicate they are the same or worse off than last year…”

Clearly, nothin to crow about.

Of the 2,478 customers surveyed, the following three financial instituitons were ranked the highest by investors: Edward Jones (853) ranks highest in overall investor satisfaction, followed by RBC Wealth Management (848) and Advisor Group (846).

As for that mobile world, turns out not everyone is all that jazzed up about mobile whatevers with the wealthy (those with $1million or more in investable assets) being  the least thrilled.

From the J.D. Power 2019 U.S. Wealth Management Mobile App Satisfaction Study the press release: “Mobile continues to be the channel with the lowest satisfaction among full-service investors across all generational segments, trailing both online/web and phone, and is especially low among Boomers (671) when compared with Gen X (787) and Millennials (853).

Why am I not surprised to learn this.

 

  • Market Quick Glance

An up week on both year-to-date returns and those representing a 1-year time frame.

Below are the weekly and 1-year index performance results for the three major indices—DJIA, S&P 500 and NASDAQ — including the dates each reached new highs. Data is according to CNBC.com and based on prices at the close of business on Friday, March 15, 2019.

DJIA 9.10% YTD up from the previous week.

  • 1 yr. Rtn 2.23% up from the previous week 2.23%

Most recent DJIA a new ALL-TIME CLOSING HIGH was reached on Oct.3, 2018 of 26,951.81. The previous high was reached on Sept. 21, 2018 of 26,796.16.

 

-S&P 500   12.59% YTD up from the previous week’s 11.84%

  • 1 yr. Rtn 2.74% up from the previous week’s 0.15%.

The S&P 500 reached a BRAND NEW CLOSING ALL-TIME HIGH on Sept. 21, 2018 of 2,940.91. The previous closing high was reached on August 29, 2018 of 2,916.50.

 

-NASDAQ 15.87% YTD up from last week’s 11.65% %

  • 1yr Rtn 2.76% up from last week’s -0.27%

Nasdaq reached a BRAND NEW 52-week CLOSING HIGH on August 30, 2018 of 8,1333.30. The previous high was reached on August 24, 2018 of 7,949.71.

 

-Mutual funds

A repeat from last week’s entry:

As one might expect, at the close of business on Thursday, March 7, 2019, the year-to-date total return for the average stock fund under the broad U.S. Diversified Equity Fund heading was10.86%. That’s down a sum from last week’s figure of 12.98%, according to Lipper.

Of the 25 Largest Mutual Funds that Lipper tracks, iShares Russ 2000 ETF had the best y-t-d performance of 13.19%.

Behind it were the iShares: Core S&P Md-Cp at 12.46%. And behind it the Invesco QQQ Trust 1 at 11.22%.

The three worst y-t-d- performing funds were DoubleLine at 0.90%: the PIMCO TotRtnl at 1.34%; and iShares: Core US Agg Bd at 1.44%

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.

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POCKETBOOK Week Ending March 8, 2019

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  • One old, fat ETF turns 20

On March 10, 1999, Invesco introduced their hugely popular and successful QQQ ETF. Now, 20 years later, the QQQ is the sixth largest U.S. listed ETF, has $66.4 billion in assets under management and was the second most traded ETF in 2018.

What’s  it’s appeal? The QQQ tries to reflect the performance of the Nasdaq-100 Index, and we all know how hot Nasdaq stocks can be.

According to INVESCO, “A lot of investors think it’s just technology, and actually, today, it’s about 40% technology and 60% other sectors, so we really look at it as large-cap growth and has a lot of the biggest innovators that we know in the economy today,” John Frank, QQQ Strategist for Invesco, said at the Inside ETFs Conference.

Since it’s original launch QQQ had an original weighting of 78% toward technology—a reflection of the dot.com world that was swinging in high form way back then.

Now the portfolio looks like this: 43.0% information technology, 23.3% communication services, 16.1% consumer discretionary, 8.5% health care, 6.0% consumer staples, 2.5% industrials, 0.4% utilities and 0.3% financials. Additionally its components include large-cap growth companies (60.8%), large-cap blended names (23.6% and large-cap value stocks (13.0%).

Top components include Microsoft (NasdaqGS: MSFT) 9.9%, Apple (NasdaqGS: AAPL) 9.6%, Amazon.com (NasdaqGS: AMZN) 9.3% and Facebook (NasdaqGS: FB) 4.8%, among others.

As for performance, since inception the QQQs annual return is around 7.2%; over the last 15 years it was 13.7%; and during the past 10 years has returned almost 21.4%.

Kinda sorta impressive, isn’t it.

 

  • Believe what you want, but….

According to a recent Reuters piece, based on data from the Federal Reserve,
“U.S. household wealth fell by a record $3.8 trillion, or 3.5 percent, at the end of 2018..”

In other words, based on percentages, the 5.9% fall represented the biggest quarterly percentage stumble in household finances since 2008.

Oh my.

 

  • Market Quick Glance

Not such a hot performance week for the three major indices followed here. In fact, year-to-date returns on each lost ground. Oh, dear.

Below are the weekly and 1-year index performance results for the three major indices—DJIA, S&P 500 and NASDAQ — including the dates each reached new highs. Data is according to CNBC.com and based on prices at the close of business on Friday, March 8, 2019.

DJIA 9.10% YTD down from the previous week’s 11.57%.

  • 1 yr. Rtn 2.23% down from the previous week 5.76%

Most recent DJIA a new ALL-TIME CLOSING HIGH was reached on Oct.3, 2018 of 26,951.81. The previous high was reached on Sept. 21, 2018 of 26,796.16.

 

-S&P 500   11.84% YTD down from the previous week’s 11.84

  • 1 yr. Rtn 0.15% down from the previous week’s 4.71%.

The S&P 500 reached a BRAND NEW CLOSING ALL-TIME HIGH on Sept. 21, 2018 of 2,940.91. The previous closing high was reached on August 29, 2018 of 2,916.50.

 

-NASDAQ 11.65% YTD down from last week’s 14.47%

  • 1yr Rtn -0.27% way down from last week’s 5.78%

Nasdaq reached a BRAND NEW 52-week CLOSING HIGH on August 30, 2018 of 8,1333.30. The previous high was reached on August 24, 2018 of 7,949.71.

 

-Mutual funds

As one might expect, at the close of business on Thursday, March 7, 2019, the year-to-date total return for the average stock fund under the broad U.S. Diversified Equity Fund heading was10.86%. That’s down a sum from last week’s figure of 12.98%, according to Lipper.

Of the 25 Largest Mutual Funds that Lipper tracks, iShares Russ 2000 ETF had the best y-t-d performance of 13.19%.

Behind it were the iShares: Core S&P Md-Cp at 12.46%. And behind it the Invesco QQQ Trust 1 at 11.22%.

The three worst y-t-d- performing funds were DoubleLine at 0.90%: the PIMCO TotRtnl at 1.34%; and iShares: Core US Agg Bd at 1.44%

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.

 

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POCKETBOOK Week Ending March 1, 2019

IMG_6850 Source: Zor Capital
  • 10 years ago

On March 6, 2019, it will be 10 years since the market bottomed that month in 2009. Time sure does fly. And with that flight has come changes to equity prices that few—looking forward back then–would likely  have imagined.

According to CNBC.com, the S&P 500 has delivered an annualized return of 17.8 percent since that March 2009 drop. Who knew? And pretty good, right?

Well, surprise surprise: That is the same kind of 10-years-after annualized returns experienced 10 years after the crash of 1987 and 10 years after the August 1982 bottom.

How about that!

Too bad past performance is no guarantee of what’s to come.

 

  • The high cost of an old life that needs care

I’m getting old and no one is more surprised by that than me. It’s not that I didn’t think I’d age. Nope. It’s just that I didn’t really believe that along with aging would come a reflection in the mirror that always semms to elicit a, “That can’t be me?” response.

And, a cost of living that’s literally staggering—if not impossible to comprehend. As for preparing for that cost. Well, I didn’t think much about that. Or, what  the cost of living into my senior years would be. Or,  imagined that assisted living care would run around 5 grand a month, for god knows how many years.

According to Genworth’s 2018 Beyond Dollars study, the median cost of a private room in a nursing home is $8,365 a month; the median cost of assisted living is $4,600 a month; and the median cost for home health aides is $4,195 a month.

Given that women live longer than men, on average, word is that the average lady will need long-term care services for 3.7 years and the average guy 2.2 years.

Doing the math, let’s just call it 4 years for the ladies at a monthly rate of 5Gs per month and one has to have a long-term care fund with something in the neighborhood of 240,000 bucks in it. Need private room nursing home care and the fee for that  care  comes to more than $400,000.

Got that?

 

  • Market Quick Glance

During the first two months of 2019 indices have reported year-to-date performances that really have been impressive —so far.

Below are the weekly and 1-year index performance results for the three major indices—DJIA, S&P 500 and NASDAQ — including the dates each reached new highs. Data is according to CNBC.com and based on prices at the close of business on Friday, March 1, 2019.

DJIA 11.57% YTD down a breathe from the previous week’s 11.59%.

  • 1 yr. Rtn 5.76% up a jump from the previous week 4.28%

Most recent DJIA a new ALL-TIME CLOSING HIGH was reached on Oct.3, 2018 of 26,951.81. The previous high was reached on Sept. 21, 2018 of 26,796.16.

 

-S&P 500   11.84% YTD

  • 1 yr. Rtn 4.71%

The S&P 500 reached a BRAND NEW CLOSING ALL-TIME HIGH on Sept. 21, 2018 of 2,940.91. The previous closing high was reached on August 29, 2018 of 2,916.50.

 

-NASDAQ 14.47% YTD up from last week’s 13.45%

  • 1yr Rtn 5.78% up from last week’s 4.40%

Nasdaq reached a BRAND NEW 52-week CLOSING HIGH on August 30, 2018 of 8,1333.30. The previous high was reached on August 24, 2018 of 7,949.71.

 

-Mutual funds

The move upward continued.

At the close of business on Thursday, Feb. 28, 2019, the year-to-date total return for the average stock fund under the broad U.S. Diversified Equity Fund heading was 12.98%. That’s up a bit from last week’s figure of 12.62%, according to Lipper.

Looking at the fund types with the highest year-to-date gains under the various headings shows the following:

Equity Leveraged Funds continue their march upward with an average return of 24.25%, y-t-d through 2/28/19, and Dedicated Short Bias Funds continue to rake in the poorest performance of -18.14%.

Of all of Lipper’s categories, those really are the best and worst year-to-date figures this year.

The Sector Equity Funds group averaged 11.30% and the World Equity Funds average was 10.12%.

So count yourself fortunate if your funds’ y-t-d performance figures are around 12%. And than, hope that average stays around the same or continues upwards.

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.

 

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