|
|
Advisor Perspectives
Insights into the world of high- and ultra-high net worth investing
August 11, 2009- Vol 3, Issue 32
|
|
|
|
|
|
|
|
Bill Gross of PIMCO forecasts
a New Normal - slow economic
growth, higher inflation, and increasing correlations among asset
classes. If this view is correct, what
should investors do? Geoff Considine examines the implications for asset allocation and financial
planning by stress-testing some well-known asset allocations to
see how well they will serve investors in the forecast environment.
Wealth managers who are considering managing 401(k) plans need to re-think those plans, according to
Brian Murphy. Murphy, who runs Pathways Financial Partners, a Tucson,
AZ-based investment advisory firm, says the
401(k) business has become a highly commoditized industry that makes it
easy for clients to switch to an alternative, lower-cost provider.
We have said before that Michael Lewitt's
newsletter is a must-read, and this edition is no
exception. Lewitt questions whether we are witnessing a summer calm before the storm, comments
on the secured and unsecured debt asset
classes, and opines on the abuses of unregulated dark pools of capital. We encourage you
to subscribe to this valuable publication through the link we provide.
To understand why investors fail to stick to their plans, economists and
academics are studying the rapidly growing field of "behavioral finance," analyzing the
patterns of behavior that cost investors serious money. Dan Richards looks at the current research and its implications for investors and advisors.
One way to significantly increase the chances of marketing
success is to develop a marketing plan and stick to it. Kristen Luke says forget the formal marketing plan
and just outline your marketing activities and budget, and she
provides a step-by-step guide for you to
follow.
Our interview last week with
economist Paul Krugman drew an
unprecedented number of responses - all of which were critical of Krugman's proposed policies. Read
our letters to the Editor.
Lastly, we highlight submissions to Advisor
Market Commentaries.
We welcome guest submissions from our
readers. For more information, here are our guidelines.
If you are experiencing problems
opening or navigating through our newsletters, we can send you a text-only
version. Please send an email to feedback@advisorperspectives.com requesting the "text-only" version.
If you have received this newsletter
in error, or you do not wish to receive future newsletters, please reply to this email with the word
"unsubscribe" in the subject line.
|
|
|
|
|
|
|
Investors became complacent in the years up to 2007 in terms of taking on
risk. Today, they have swung to the opposite extreme. In the
future, investors must take a critical look at traditional asset allocation
models and consider how they should be adapted to better serve the demands
of the New Normal.
What the New Normal Means for Asset
Allocation
|
The
Business You Don't Want: 401(k) Plans
|
|
"The 401(k)
business is very challenging," says Brian Murphy of Pathways Financial
Partners. "Advisors who dabble in 401(k) plans will always lose
to an expert who understands all aspects of the plan - such as whether it
is appropriate for a carve-out (a separate plan for top employees) or for
an ESOP. Experts will come in and tell the client how to do it
better, and you will be fired."
The Business You Don't Want: 401(k)
Plans
|
At
the Risk of Repeating Ourselves
|
|
Despite what the
pundits would have you believe, nobody has the faintest idea whether the
economy is going to experience sustainable growth once the government stops
stimulating it. The Armageddon trade is clearly off the table, but the
Return to Nirvana trade is nowhere on the horizon either.
At the Risk of Repeating Ourselves
|
Behavioral
Finance Traps En Route to Investment Success
|
|
Perhaps the best insight into the behavioral finance traps that cost
clients money comes from cartoonist Walt Kelly's famous line from the
cartoon strip Pogo: "We have seen the enemy and he is us."
The good news is that awareness is the first step to overcoming these
dangerous traps. Help clients understand the behaviors that undermine
investment success and you and they will be better positioned to avoid them
going forward.
Behavioral Finance Traps En Route to
Investment Success
|
How
to Construct a Marketing Plan and Budget
|
|
Kristen Luke offers a four-step plan for constructing a marketing plan and budget
- choose your strategies, plan your year, create a budget, and implement
the plan. She also provides worksheets to facilitate the process.
How to Construct a Marketing Plan
and Budget
|
|
Letters
to the Editor - Paul Krugman
|
|
If you are among those who believe Paul Krugman is advocating Keynesian
policies doomed to failure, then you will agree with those who responded to
our interview with professor Krugman last week.
Letters to the Editor - Paul Krugman
|
|
Highlights
from Advisor Market Commentaries
|
|
The job market remains the laggard, as is typical, in the recovery. Even so,
conditions seem to be falling into place for something stronger than the
consensus tepid economic recovery. Residential construction and
manufacturing should lead the rebound. Once the consumer kicks in, there is
a real possibility that the economy could be off to the races. So the
possibility of a V-shaped recovery is rising.
It
Is Looking More Like A V-Shaped Recovery by Dr. Charles
Lieberman of Advisors Capital Management
Economic data remained positive throughout the week and improvements in the
ISM index provided early support to the equity markets. Data on
pending home sales also surprised to the upside as a combination of low
prices and low mortgage rates motivated buyers. By the end of the
week, the unemployment report offered the most hope of a weakening
recession.
Economic
Improvement Going Global - by the Fortigent Investment Research
Team
|
|
Advertise
in Advisor Perspectives
|
|
Our newsletter goes to over 75,000 RIAs, wealth managers, and financial
advisors. See how you can deliver your message to our sophisticated
audience.
Read more
|
|
Advisor
Perspectives
Box 380
Lexington, MA 02420
(781) 376-0050
|
|
|
|
|
|
