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GARY SHILLING: Here Are 9 Investments I Like Amid The Current Pessimism (A. Gary Shilling’s Insight)
Gary Shilling thinks we’re still seeing a “risk on” investment climate, “but the switch from optimism about the economy and stocks at year’s end to pessimism so far in 2014 is noteworthy. So is the emerging market deterioration, especially for countries with big current account deficits.”
With that in mind Shilling thinks nine things make attractive investments right now. 1. Treasury bonds; 2. Selected income-producing securities; 3. Small luxuries; 4. Consumer staples and foods; 5. The dollar against the Canadian and Australian dollars; 6. Selected health care providers and medical office buildings; 7. Low P/E stocks; 8. Productivity enhancers; 9. North American energy producers ex renewables. Meanwhile, he thinks select commodities and developing country stocks and bonds are unattractive.
The stock market has seen a fair amount of volatility this year and many investors are wondering how to position themselves going forward. “We can have a correction any time. Here since the beginning of the year, stocks are down a little over 3%, using the S&P 500 as a yardstick,” says Josh Peters, editor of Morningstar DividendInvestor. “That’s still a ways to go on the downside to reach the classic definition of a correction being a 10% pullback. Maybe you won’t get that far.”
“There’s some bad news that is out there that people weren’t previously incorporating into stock valuations; now that discounting process has begun. I don’t expect a repeat of last year. But then again, I didn’t have a real strong expectation at the beginning of last year that we were going to see total returns in the low-30% range. Instead, I think you have to shift the conversation. You have to organise your portfolio and your thinking around what is going to matter most for a retirement strategy, whether you’re leading up to retirement, saving and investing for retirement, or whether you are already there making portfolio withdrawals. And that’s your income.”
During ‘tax season,’ investors are under time constraints to make their IRA contribution for the previous year, but often when they haven’t made up their minds the put their money in a money market fund, write Stephen Weber and Maria Bruno at Vanguard. But over two-thirds of last minute contributions to money market funds stays in those funds four months later. “IRA investors could benefit from mirroring the plan sponsor trend toward increasingly making target-date funds their default option for participants,” they write.
These 5 Things Can Help Improve The Efficiency Of Your Practice (WealthManagement.com)
While technology has helped make estate planning more efficient it can also offer numerous distractions. Louis Harrison and Nancy Hughes at Trusts & Estates highlight a few key things that financial planners can do to improve efficiency. We highlighted a few.
1. Learn to step away from the computer and work in a space where you can actually lay out your papers and focus on work.
2. Turn off notifications to reduce distractions.
3. Learn to identify the time of the day that you are most productive and reserve that time for the hardest work.
4. Communicate with clients between the phone call and the initial meeting through email or social media or marketing.
5. Don’t reply to emails immediately this sets a precedent that could impact your quality of life.
Emerging Markets Saw Their 15th Straight Week Of Investor Outflows (Morgan Stanley)
Emerging markets saw outflows for the fifteenth straight week, according to the latest report from Morgan Stanley. Investors pulled $US6.36 billion from emerging markets, and combined with the $US6.33 billion in outflows last week, that would be the largest two-week outflow since January 2008.
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