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Stay Invested to Help Soften the Arithmetic of Loss

The stock market, it might be said, is the greatest of teachers, but attending class isn’t always fun. One of the harshest lessons the market has to impart to investors concerns the arithmetic of loss. Quite Like medical students learning about the ravages cancer can cause, investors understand the potential of portfolio losses, yet persist in hoping the lesson applies to others, never to themselves. Fact is, as the arithmetic of loss shows, a given percentage of gain is never [...]

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Re-Sectioning the Pie Chart

The whole idea behind asset allocation is to prevent extremes. Experience has taught us that the three main categories of investment assets—equities (stocks), fixed-income (bonds), and cash equivalents—each behave differently in reaction to any given set of circumstances. The term for this difference is “negative correlation.” Investor.gov, the website of the U.S. Securities and Exchange Commission, explains asset allocation by comparing it to street vendors who sell both umbrellas and sunglasses, two items consumers are unlikely to purchase at the [...]

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If-Then Investment Planning Prior to an Election

In classical logic, a connection is made between two statements, implying that if P (the proposition) is true, then Q (the next statement) is also true. If Sarah works overtime, she’ll be paid time-and-a-half. If I study, then I’ll get good grades. If I get good grades, then I’ll get into a good college. You get the idea—If statement #1, a given fact, is true, then statement #2 is a new fact that may be deduced from statement #1. Just [...]

Sheaff Brock Money Managers, Investment Survival Tactics, and Dixie-Cups Style for Investment Growth

Investment and Estate Planning Survival Tactics Dixie-Cup Style

Before the Spanish flu hit, the company behind Dixie Cups was just another scrappy startup, Kevin Leland points out in fastcompany.com. Once the pandemic hit, because it was hoped disposable cups would help stop the spread of the disease, Dixie used survival tactics to eventually become a household name. The moral of this story, Leland believes, is this: Timing is one of the crucial stars that must align for any start-up to succeed. But what if the timing isn’t right [...]

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Will a Great Rotation Make an Early Arrival? Is COVID-19 the Catalyst?

Months before COVID-19 had become the topic of everyday conversation, Marketwatch was talking about the arrival of a “Great Rotation” in 2020, anticipating the shifting of bond holdings into stocks. Now, a half year later, Bank of America agrees with that prognosis: “The stars have aligned for more stock gains,” BOA observes, with equities being the most attractively valued in decades as compared to bonds. For investors, the coming great rotation will be all about investment yield, explains Sheaff Brock Managing [...]

Sheaff Brock looking at COVID-19 Rate of Change | woman looking at bad news on phone

News Bad; Market Strong? Pay Attention to the COVID-19 Rate of Change

It’s a puzzlement—how can the market be this strong when the news continues to be so bad? A certain calendar date may offer a clue. On March 23, 2020, two things happened. The COVID-19 death “rate of change” peaked, with a steady descent following. At the very same time, the stock market bottomed, then began a sustained rise. To be sure, the news continues to document a rising pandemic death toll. According to Johns Hopkins, on March 23rd the number of [...]

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Glimmers of Optimism Breaking Through the Outbreak

With bad news abounding—confirmed virus cases, virus deaths, unemployment, and falling corporate earnings—how could stock market news possibly include an upswing? “Markets don’t need good news to advance,” explains Sheaff Brock Managing Director Dave Gilreath, “only an inkling of better news.” Stock market prices are predictive, Gilreath adds, often moving up on anticipation of better news. On one very recent day, for example, cruise line, hotel, casino, airline, and restaurant stocks gained more than 10%, flying in the face, of [...]

Sheaff Brock Reviews Benefits of Charitable Giving for 3-Generation Families

Charitable Planning Can Cure the 3-Generation Curse

The American version of the old Chinese saying, “Wealth does not pass three generations” is “Shirtsleeves to shirtsleeves in three generations.” Whenever there is a lack of financial literacy, and wherever family values are not emphasized, Vernon Wong of First Hawaiian Bank emphasizes, there exists the very real danger that the wealth will dissipate by the third generation. The wealth attribution rate is surprising high, agrees Augusta Dwyer of Globe Wealth, affecting 90% of family fortunes. Of course taxes, inflation, [...]

Street Sign of Worst and Best | Double Decade Stock Market | Sheaff Brock

Believe It or Not — Stellar 2019 Ends Second-Worst Double Decade in History

“For investors, the past decade was a marvelous run, but that tells only half the story,” Ben Carlson writes in Fortune. Not only were the 2010s the first decade since 1850 that the U.S. did not experience a single recession, the stock market has hit more than 200 new all-time highs on the S&P this decade alone. A chapter in Chip and Dan Heath’s book, The Power of Moments, offers a valuable perspective. Research has found, the authors note, that [...]

Holiday "gift bags" filled with last-minute ideas for investors' year-end planning | Sheaff Brock

A Potpourri of Year-End Planning Ideas

Just as retailers—and etailers—are out in force with eleventh-hour holiday gift ideas, financial companies are offering “gift bags” filled with last-minute ideas for investors’ year-end planning. And, while it’s never too late for financial planning, there are certain December deadlines and cutoff dates, as Kiplinger.com details: RMDs Required Minimum Distributions from IRAs, 403(b)s and 401(k)s must be completed by December 31. However, for the year in which you turn 70.5, you may defer your first RMD until April 1st of the [...]