September 9, 2019
In the investing world, things are often not as bad as they seem. The data doesn't always match the headlines.
Today we talk about:
- August was not good, but was it really bad? It felt really bad.
- The worst month for stocks (so far) this year is...
- Have we even had a correction in stocks yet?
- Don't look now, but the US stock market is having a really good year.
- So is everything else.
- The fourth quarter is the "money quarter" for the stock market.
To learn more and look at pretty pictures, visit: http://flemingwatson.com/not-as-bad-as-it-seems/
September 5, 2019
There has been a lot of attention lately about the more than $17 Trillion of debt with negative yields. Much of that is issued by foreign governments. But there is about a trillion dollars in corporate debt with negative yields
So does this mean you are paying these countries for the privilege to loan them money? Better yet, why would anyone buy these bonds with no return? We'll talk about it on today's episode.
Note: Monday Morning Money is also broadcast on our local radio station, WMOA (1490 AM and 101.3 FM) each Monday at 11:07.
August 14, 2019
Recent volatility in the stock market has many investors looking for "safety". Many turn to government bonds. But is now the right time to invest in these notes? Today we'll talk about the hidden risk in bonds.
Key Concept 1: Yield
When talking about bonds, the first key concept is yield. Yield is the return you will earn when you buy a bond. It factors in the current price, the interest rate, the date it matures, and the return of principal.
If you buy a bond with a 2% yield and hold it until maturity, that is the return you will realize.
Key Concept 2: The Relationship Between Yield and Price.
The second concept is the relationship between yield and price. Bond yields and bond prices are inversely related. This means when bond prices go up, yields go down. And when yields go up, prices go down.
Where is the Hidden Risk In Bonds?
Bond yields are near historic lows. And it is hard to imagine them going lower. When they increase, it could create a very difficult situation.
Those who buy these longer term notes will face two choices. The first is to accept a low rate of return over the next several years. The other option is to see the value of their investment decline as yields move higher.
If you would like to see an example of how rising yields impact bond prices, check our post at:
August 8, 2019
Investing in emerging technology sounds exciting. At least one of our listeners thought so. He submitted a question wondering how we could invest in the following areas:
- Artificial Intelligence
- Internet of Things
We'll share some ideas on this week's episode of What's Happening Now.
For a list of exchange traded funds which specialize in these emerging technologies, please visit the following link: http://flemingwatson.com/investing-in-emerging-technology/
August 6, 2019
After July 26, the stock market has experienced a mini correction. And the financial media loves a big down day. They plant the seeds of the next financial Armageddon in our minds. Is it time to panic? Today we'll address the drop and tell you where we are in the big picture.
July 31, 2019
As the stock market and the economy have continued to chug along, we felt it was time for a more conservative approach. Today we talk about some of the steps we have taken to reduce investment risk for our clients.
July 25, 2019
What's the worst month for stocks? The answer may surprise you, it did me. We take 2 minutes to talk about it, and why it matters.
The Worst Month For Stocks
My guess for the worst month would have been January. But, I would have been wrong. The worst month has been August. The average monthly return for August since 1994 has been -0.59%. In fact only two months have negative returns, on average.
August is a bad month for stocks. But that doesn't mean you should make any major decisions. In the past 25 years, August produced gains in the stock market 17 times. But 8 times stocks fell during the month left their mark.
July 18, 2019
The S&P 500 recently closed over 3,000 for the first time ever. And it begs the question, "Is this the top of the stock market?" At least one large money manager thinks stocks are headed higher. Much higher. We talk about that on today's episode of What's Happening now.
We have been following First Trust Portfolio's commentary for some time. You can read their post about their increased forecast and the methodology they use, here.
As most of you know, we are not in the prediction business. And most who are, have limited success. But it rarely stops anyone from trying.
The stock market will either go up or down from here. The only way we will know who guessed correctly is to wait and see. We rarely take any of them to be reliable indicators of future performance.
We are certainly hopeful the S&P 500 passes the 3,250 mark. But if it doesn't, we won't be surprised.
Neal Watson is a Certified Financial Planner™ Professional and a Financial Advisor with Fleming Watson Financial Advisors He typically works with people who are planning for retirement. Fleming Watson is a Registered Investment Advisory firm located in Marietta Ohio. Our firm primarily serves Marietta, Parkersburg, Williamstown, St. Marys, Belpre, Vienna and the surrounding communities in Washington and Noble Counties in Ohio and Wood and Pleasants county in West Virginia.