Managed Futures: 5 Questions to Understand

Dear Mr. Market:

What’s your plan for when the stock market goes down? Is this plan the same for when bonds go down? Over the last several years of this bull market we have gradually prepared for this inevitable event by establishing a strategy in advance as opposed to one that is reactionary or emotional.

After reading this article we ask that you do something different the next time the sky is falling. Tell yourself that before the next market crash you won’t have fear, panic, or emotions guide your strategy but rather follow an intelligent plan.

One way to hedge your portfolio against serious drawdowns is by using alternative investments such as Managed Futures. The following five questions are from an interview by US News with Cliff Stanton, CFA and Co-Chief Investment Officer at 361 Capital:

What are the potential benefits of investing in futures?Cliff_final

The primary benefits that managed futures strategies offer are: Continue reading

‘Twas the Day of the Election…Stock market rally or sell-off?

 

img_59101Dear Mr. Market:

It’s that time of year again….here comes the holidays. One of the most famous Christmas poems ever begins like this:

‘Twas the night before Christmas, when all thro’ the house

Not a creature was stirring, not even a mouse;

The stockings were hung by the chimney with care,

In hopes that St. Nicholas soon would be there;

What if we changed a few words to reflect what Mr. Market will be thinking about instead of sugarplums and Christmas stockings? What is he thinking on Election Day?

‘Twas the day of the Election, when all through the nation

Every citizen was encouraged to get to a voting station;

Constant stories of Wikileaks and groping

Had every American and the stock market moping;

The media was franticly filling their time with endless chatter

All in hopes that our eyeballs would think a new President would matter;

Whether you’re liberal or conservative we all want a sound future for our girls and boys

As it relates to the stock market it simply prays for an end to this noise;

So goodnight to all and may you wake tomorrow

Knowing full well that some will be joyful and others in total sorrow.

We’ve obviously abbreviated our stock market poem to center on the real question so many investors have: Will this election result drive the markets higher or lower? Continue reading

The Baby Boomer Retirement Crisis

“When there is blood in the water…the sharks will come!”

sharks - dmmThis isn’t a quote from ‘Shark Week’ on the Discovery Channel, it is an accurate summary of what is currently happening as financial firms are targeting a huge demographic that will continue to grow in our country. The baby boomer generation (born 1946 – 1964) has made a dramatic impact on our country throughout their lives and now they’re all entering or nearing retirement. Every single day there are 10,000 additional baby boomers turning 65! As they enter retirement and roll over their retirement accounts, they find themselves being targeted by various firms attempting to ‘feed’ on their hard-earned savings. This year FINRA (Financial Industry Regulatory Authority) has filed several ‘cease-and-desist’ orders against financial firms for these practices and also launched the FINRA Securities Helpline for Seniors at 844-57-HELPS or 844-574-3577 in an effort to address this growing issue.

FINRA reported that the hotline received several hundred calls as soon as it was opened from individuals ranging in age from 45 – 99. The regulatory agencies realize they need to get ahead of this crisis as it will only continue to grow with each passing year. This spring the SEC and FINRA released a report titled “National Senior Investor Initiative”, the study focused on 44 national firms, looking at the products and services that were sold by their representatives to senior investors.   Below are the results based on the revenue generated and the frequency that they were purchased at the firms: Continue reading

MPG Core Tactical 60/40: April 2015 Performance Update

MW-BB798_sm6040_20130422180557_MDDear Mr. Market:

Every month we write to you and chat about the markets and how people are behaving based on your results. Sometimes it’s good to refresh (click here) our memory of why we do this and what the MPG Core Tactical 60/40 portfolio is intended to do. First and foremost, our aim with this series of monthly articles is not to “beat the market”, race against any benchmark, or pretend we have a crystal ball. In the most ironic way possible, those that follow this series of articles will eventually understand that the primary focus of this exercise is to show you how picking stocks and trying to “time markets” is usually a hit or miss expedition. At the end of the day (or in this case, whenever we decide to stop writing these “letters”), you will likely see that holding a properly disciplined and balanced portfolio of instruments tracking specific indexes beats out most “potpourri” type portfolios. Continue reading

Currency Markets: Not the Roller-coaster you think it is!

dollar3Dear Mr. Market:

You’ve taken equity investors on a roller coaster ride this year with the Dow Jones now delivering negative returns year to date. Investors have been scrambling to find where to invest their money as they move out of equities. The fixed income markets remain an area of doubt as interest rates are near rock bottom levels and fear of rate hikes from the Fed continue to run rampant. With all these variables and negativity in the market where should investors consider looking to invest their cash?

We’ve discussed ‘Alternatives’ before and how they warrant a place in a diversified portfolio. Often investors become a bit skeptical when they hear the term Alternative Investment as thoughts of hedge funds and ‘ponzi schemes’ come to mind.   With new regulations and monitoring in place investors can feel confident when they consider adding these types of investments to their portfolios. The investments that typically come to mind when looking at this asset class are: real estate, commodities, futures and hedge funds. Today will take a look at one component of alternative investments that is often overlooked but investors interact with everyday– the dollar or currency markets in general.

If you turn on the nightly news or read any articles about the economy it is hard not to see headlines discussing the strength and/or weakness of the dollar. What does this really mean and how can an investor take advantage of these moves? Analysts and economists tend to use terms to make themselves sound like an authority while at the same time losing 90% of their audience. Below we will discuss some of the basics:  Continue reading