DEJA VU… AGAIN?
The first quarter of 2013 was a welcome surprise. Equity returns as measured by the S&P 500 and the S&P Dividend Index were 10-14% respectively, while international markets as measured by the MSCI World Index were below 7%. The next logical question is, “What’s next?” (Read More…)
A SMOOTH SEA NEVER MADE A SKILLFUL MARINER.■ Ty HaberlingCFP® ■ January 2012
I don’t know about you, but occasionally I read a quote that leaves me with a feeling of, “Hmm. That sums it up.” The quote above is one of them. The 2008 economic and market decline certainly provided those of us in the financial world a chance to become more skilled sailors. The question is did we blow it off as a 1 in 100 year event or did we look for clues that help us foresee similar future events. In other words, are we researching methods to make our ship safer for rougher seas or did we continue using the same design? (Read More…)
CAN FUTURE RETURNS BE ACCURATELY PROJECTED? ■ Ty Haberling, CFP® ■ November 2012
My search for the answer to this question led me to John Hussman, Crestmont Research and GMO LLC. GMO and Hussman are portfolio managers, and Crestmont Research is a research organization. All three of them utilize a Total Return math equation to explain historical returns and project future returns. This paper will discuss three primary topics. First, it will illustrate how Attribution Analysis and the Total Return math equation help explain past returns. Second, we will examine how accurate the Total Return math equation is in projecting future returns. Third, we examine what is the likely scenario for stock market returns in the future.(Read More…)
WHAT REALLY MATTERS WHEN IT COMES TO INVESTING? ■ Ty Haberling, CFP® ■ August 2012
Quite often I’m asked by clients “What is going to happen to the economy?” Recently, I’ve returned the question with a question. “Why do you ask?” The general reply with an occasional look of surprise is “Doesn’t the economy have something to do with my investments?” And the answer is yes; the economy affects your portfolio return. However, this leads to the next question: “Do we need to be able to forecast macro events to become excellent investors and is it possible to forecast the economy in the near term?” In my humble opinion economic forecasting is a not a requirement. (Read More…)
29 YEARS OF PERSPECTIVE ■ Ty Haberling, CFP® ■ May 2012
This article will articulate why we believe that the next 2-4 years are likely to be a low return environment. Candidly, we are waiting for a “Price Event,” which means a decline in global stocks. Only a price event can change the forecasted level of returns to make them attractive. Markets can get extremely overvalued in the near term and if they do they only present even greater levels of risk for those that participate in them.(Read More…)
WHAT’S NORMAL? ■ Ty Haberling, CFP® ■ February 2012
The question that investors are asking is: “What’s a normal return for the next 3-5 years?” In our opinion the answer is: “Much less than the historical average.” (Read More…)
PLAYING DEFENSIVE ■ Ty Haberling, CFP® ■ November 2011
HFG has decided it is time to take a defensive posture and make a significant change in our allocation strategy. We researched and evaluated where we think our weakest link lies. We believe it is in Europe. Because of this we have reduced our exposure to international stocks by 80-100%. This is significant and didn’t occur without debate and analysis. Let me share with you our thoughts. (Read More…)
INVESTMENT APPROACH: The Constant Process of Analyzing Return and Risk ■ Ty Haberling, CFP® ■ July 2011
It has been a few months since we’ve publicly shared our thoughts on our portfolio management approach. We’ve been quite busy with our research as we follow Greek bailouts, US Debt Ceiling issues, Market Valuations and the current state of the economy. You’ve probably noticed that we’ve been making allocation changes in your accounts. Those changes are like Lincoln’s 15 minutes chopping the tree. I’d like to share some of our thoughts about the work we’re doing to keep the axe sharp. (Read More…)
3RD QUARTER MARKET SUMMARY ■ Ty Haberling, CFP® ■ October 2010
Investors are chasing past returns by plowing capital that once was in equities into bonds. I think we have a new bubble forming. Fortunately, it will not be destructive as were the housing and dot com bubbles. According to the Investment Company Institute bond funds have attracted over $350 billion dollars of new money in 2009 and even though the pace has slowed there is still significant demand. Why does this concern me? The flow of capital to bonds and the feds policies have pushed interest rates down to unheard of levels in modern US history. (Read More…)
2ND QUARTER MARKET SUMMARY ■ Ty Haberling, CFP® ■ July 2010
In our 2Q 2009 Market Summary we reported that economic recovery had started, but that the more important question was how strong would that recovery be. Two metrics used to illustrate this assertion were housing starts and the Institute of Supply Management’s (ISM) survey of manufacturing activity (which tracks new orders, production, employment, supply deliveries, and inventories). (Read More…)
1ST QUARTER MARKET SUMMARY ■ Ty Haberling, CFP® ■ January 2010
What a difference 12 months can make. Last year at this time the economy was going through its third consecutive quarter of economic contraction. GDP 1Q of 2009 shrank over 6% on an annualized basis. Equity prices as measured by the S&P 500 hit bottom in early March at 676 from its peak of 1561 in 2007 for a fall of 56%. The economy turned positive the 3Q of last year. From March 2009’s bottom (676) to the end of March 2010 (1178) the S&P 500 has risen 74%. With all of the good news, unemployment has still trended higher. (Read More…)
4TH QUARTER MARKET SUMMARY ■ Ty Haberling, CFP® ■ December 2009
2009 Equity returns were the year of the rebound. Global Equities as measured by the S&P 500 and MSCI EAFE Index increased in value 26-27%. On the surface it looked like a good year. However, one needs to keep perspective that we are still 30% or so off of the S&P 500 all time high. 2009 didn’t start with a bang. The markets tumbled through the first two months of the year finding a bottom the first of March.(Read More…)
