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Interest Rates
Many investors, especially retirees, understandably are focused on generating income from their investments.  Historically, bonds have been one of the best ways to achieve that, with less volatility than equities.  While history can be a fantastic guide to what can potentially happen in the future, looking at recent data on fixed income returns could not...
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Fears of the Coronavirus have caused bonds to rally, resulting in lower interest rates once again.  The Tech Bubble has continued to grow, while value stocks have been left in the dust the last few months.  While this can be frustrating over the short-term, over the long-term, it creates compelling opportunities to create substantial wealth....
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2020 is shaping up to be a strange year.  This Coronavirus has a region in China, far larger in population than New York city, on a complete lock-down.  There are zombie cruise ships patrolling the waters in a state of full quarantine, with no countries wanting to take the risk of allowing them in to...
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“Those times when you get up early and you work hard, those times when you stay up late and you work hard, those times when you’re too tired and you don’t feel like working and you do it anyway:  That is actually the dream.  The destination is the journey.” —Kobe Bryant   It is a...
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Over the weekend, I was reading Barron’s, and there were numerous articles about obtaining enough income in retirement.  The recommendations vary from buying dividend stocks, annuities, and/or bonds.  All of these strategies offer various challenges and risks.   Buying dividend stocks offers income and the potential for capital appreciation.  The problem is that many of these...
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To piggyback on our last article discussing the illogical 60/40 portfolio in today’s interest rate environment, I thought I’d pass on this article on how interest rates impact bonds.  Many people don’t realize the immense risks that rising interest rates pose to bonds.  In the inflationary 1970’s, bonds were called “certificates of confiscation” due to...
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Historically, it has made reasonable sense for retirees to have a sizable allocation to bonds.  A minimum of 40% was certainly not uncommon.  The logic behind this was that retirees regularly draw from their accounts and are less comfortable with the enhanced volatility that stocks can at times provide.  The supposedly steady income from the...
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This morning I read a good article in the WSJ, posted below.  The article discussed that, as a whole, stocks and bonds are pricey by historical measures.  Highly valued stocks and bonds have very likely pulled future returns forward, meaning many investors have less of an opportunity for big gains in the future. “U.S. stocks...
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Over the last week, value stocks have poised very impressive gains, while many of the momentum names have really struggled.  This is obviously very good for our deep value investment portfolios.  I want to emphasize, we should never get too excited or upset by short-term performance metrics.  With that said, value stocks are as cheap...
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This has been a very busy week for earnings releases on some of our largest investments.  I just wanted to provide a quick update on a few of them, as they were meaningful. Assured Guaranty (AGO), was up roughly 7% after reporting a very strong quarter and a particularly attractive acquisition.  Net income was $142MM,...
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