FA Insights is a daily newsletter from Business Insider that delivers the top news and commentary for financial advisors.
Investing Properly Is Often Psychologically Painful (Advisor Perspectives)
Investors have a hard time accepting that they are in a “very-low-return world for a long time,” Charles de Vaulx of International Value Advisers told Advisor Perspectives. “Some individuals do not want to amend their lifestyle (i.e., save more and consume less) and may not want to be told that at best, the return on their financial assets may be 3 to 5% in the next 10 years, and even less once you adjust for inflation.” He also said its important for advisors to remind clients that they cannot “just equate high economic growth to good stock market performance, particularly with respect to emerging markets.”
Finally, he adds that advisors should avoid generalizations. “They should understand that the devil is in the details, and that oftentimes you have to do what hurts. Today, interest rates are low, so everybody is chasing yield. They want to own REITs, MLPs and emerging-market debt funds. Investing is about having the fortitude to resist the temptation of these things. Investing properly is often psychologically painful.”
Trio Of Merrill Brokers Jump Ship To Deutsche Bank (The Wall Street Journal)
Michael C. Dawson, Stephan Farber, and Stephen Cordill have left Bank of America’s retail brokerage unit to join Deutsche Bank’s wealth management office in Houston, according to The Wall Street Journal. Together they managed over $US1 billion in client assets at Merrill Lynch. “Texas is an extremely important region for us, with continued wealth creation as a result of innovation and outstanding ingenuity, particularly in the energy sector,” Deutsche Bank’s Haig Ariyan told The WSJ.
8 Best Conferences For Financial Advisors In 2014 (Nerd’s Eye View)
Financial planners come across numerous conferences every year and it’s often hard to pick the best ones for them. Michael Kitces of Nerd’s Eye View has identified eight conferences in 2014 that advisors should watch for: 1. For technical content, he recommends the AICPA Personal Financial Planning (PFP) conference at the Aria Resort & Casino in Las Vegas. 2. For advisor technology he recommends the Technology Tools For Today (T3) Conference in Anaheim, Calif. 3. For advanced practitioners he suggests The FPA Retreat in Miami, Fla. 4. For investment management, IMCA Annual Conference in Boston. 5. The best conference in terms of overall value is the FPA Northern California (“NorCal”) in San Francisco. Kitces writes that this is for both firm owners and their staff. 6. The FPA Experience conference in Seattle is Kitces’ nomination for the best overall financial planning conference. This one is great for networking and is popular among the international financial planning world as well. 7. The NAPFA iConference is the best virtual conference. 8. Finally, for the best practice management conferences Kitces recommends focusing on the advisor’s own custodian or broker dealer conference. “Given the size of some organisations, many of these events have become absolutely huge, as Schwab IMPACT and LPL Focus now pull several thousand participants.”
The Fed Projects Rates Through 2016 (Business Insider)
The Fed announced today that it would not be tapering its $US85 billion monthly asset purchase program. The Fed wants “more evidence of growth progress before tapering.” The Fed also released its latest economic projections, with 12 participants saying they expect the first hike from current 0 – 0.25% to come in 2015. “[E]ach shaded circle indicates the value (rounded to the nearest 1/4 percentage point) of an individual participant’s judgment of the appropriate level of the target federal funds rate at the end of the specified calendar year or over the longer run,” explained the Fed.
Gold Is Not Money And Gold Prices Haven’t Bottomed Yet (Business Insider)
Jim Rogers doesn’t think gold prices have bottomed yet. “Until the faithfuls are washed out of gold, in my view we haven’t made the bottom,” Rogers told Business Insider. This correction is in part because the precious metal has had a “magnificent 12-year run.” Rogers also doesn’t think gold is money.
“A lot of people think gold is holy, that it’s money. There are a lot of people who will tell you gold is the only real money. The problem with that is that throughout history silver has been used, brass has been used, seashells have been used, lots of things have been used as money. The only thing that’s money as far as I’m concerned is if you go into a shop and you hand a person whatever it is and they accept it. If you go in and hand them gold, they’re not going to hand you a loaf of bread. They’re not going to give you a tie, they’re not going to give you anything. Until that happens it’s not money.”
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