Free Investment Reports - Investment Strategies & Insights

Election 2020: Racing towards November

As the 2020 presidential election campaign heats up and polls show Joe Biden holding a lead of 7.5 points (49.2% to 41.7%) over President Trump, while the betting odds suggest a tighter spread, we must caution that the race is far from over. Indeed, pollsters and oddsmakers are hardly infallible as just four years ago, Hillary Clinton led Donald Trump in the presidential race by four or five percentage points one month before Americans cast their ballots. Market historians, and perhaps everyone, should be thrilled to see the page turn to 2021, even as the winner of the Oval Office will still be dealing with COVID-19, as well as political and economic uncertainties.

Epidemics: COVID-19 Not the First, Nor the Last

In this report, we offer perspective on epidemics and the equity market turbulence associated therewith as we have long believed that the secret to success in stocks is not to get scared out of them, while we are always focused on the long-term, multi-year prospects of the businesses in which we are invested. Happily, capitalism’s immune system is quite strong.

The Death of Value

While returns for Value stocks were terrific in 2019 and Value turned in a very good decade of returns, Growth stocks have outperformed for a while now, as shown in this report. And while Value may continue to lag Growth in the future, we continue to recommend investments in Value stocks, especially as those stocks trade for what we believe are inexpensive price multiples and largely higher dividend yields.

Turbulent Markets: Act Quickly and Do Nothing

In this report, we identify a few of the most common events which have historically caused temporary market disturbances. These events could easily deter you from staying on track with your long-term investment plan. But historical data suggests that doing nothing can be the best course of action.

Rising Interest Rates and Inflation are Not Fatal

In this report, we discuss the Taper Tantrum in 2013, stock performance during rising and falling rate environments and the Federal Reserve’s inflation and rate targets.

The Most Wonderful Time of the Year

Stock prices will always gyrate up and down, especially as geopolitical events now more than ever drive short-term market moves, but the secret to success in equities is not to get scared out of them. Yes, there are question marks about how strong Q4 earnings will be, but with the economy in OK shape, investor sentiment far from euphoric, the Federal Reserve remaining very accommodative, and corporate balance sheets and income statements generally healthy, we can’t help but be optimistic about the long-term prospects of our portfolios of what we believe to be undervalued stocks.

The Value of Dividends

Dividend income and its reinvestment has comprised a significant portion of long-term stock gain. Dividends today compare very favorably to income that can be generated from competing investments as the S&P 500 yields 1.8%, a smidge less than the yield on the 10-year U.S. Treasury (as of 12.31.19), while the yield for Value stocks (represented by the Russell 3000 Value index) is some 70 basis points higher at 2.5%.

2020 Market Outlook

No doubt, the huge advance in 2019 has many questioning whether the equity market gains can continue in 2020. Hopefully, it should come as no surprise when our answer is that nobody can predict short-term market movements with any certainty and we must always be braced for downturns, corrections and even Bear Markets.

Presidential Cycle: Fourth Year

Whether we end up with an incumbent victory for the Republicans or a transition to a Democrat in the White House, our political platform always starts and ends with recommending a diversified portfolio of what we believe to be undervalued stocks.

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