The Armbruster Capital Management News & Education section of our website incorporates articles, vidcasts, and newsletters specifically geared towards issues that our clients are facing today.
Year end is right around the corner—a time when a young man’s fancy lightly turns to thoughts of, well, tax planning.
For most of us, the thought of tax planning is enough to either make us glaze over in a daze of boredom and confusion or send us screaming for the exits as we wait for the annual fleecing by the tax man.
Question: What do you call an economist with a forecast? Answer: Wrong. We are constantly inundated with forecasts from “the experts.” This is true not only from economists but also from political pundits, Fed watchers, stock market strategists and other prognosticators.
The world is full of investment pornography. This is a term coined by a mutual fund marketing executive I know to describe misleading claims in the investment industry. One such claim is that smart, hard-working investment managers with cutting-edge technology can outperform the market by actively trading stocks or other investments. Although it seems intuitive that this approach would produce positive results, the evidence indicates differently.
Given the length of the current stock market rally and the level stock market valuations have reached, there is a large and growing consensus that the next downturn is right around the corner.
Many believe that rather than just a modest decline, the next downturn will be another sharp, painful correction, similar to what we experienced in 2008.
Is the stock market overvalued and ready to crash?
I have fielded a lot of questions lately on just that topic. Typically, investors get uneasy when the stock market declines in value. However, with visions of 2008 still in our heads, many investors are increasingly nervous as stocks continue to make new highs.
Individual investors make bad decisions. That is the conclusion of a recent study, showing that 401(k) plan investors are increasingly tilting their accounts toward stocks although stock market valuations have risen significantly.
With winter finally winding down and the holidays squarely behind us, I’d like to say something very Grinchy: It is actually better to receive than to give. This may sound like blasphemy, particularly in Rochester, a city renowned for its philanthropy. But I’m not talking about charitable giving. I’m talking about your investment portfolio.
I ’ve said it before: No one likes bonds. They’re boring, they don’t have much opportunity to appreciate in value, they can be rather complicated and their income is generally subject to unfavorable tax rates.
It may be blasphemy, but I’m going to say it anyway: I don’t like dividends.
It is difficult to open an investment magazine or newspaper these days without seeing an article on the merits of generating investment income. The main argument usually is that since the largest part of our population is at or nearing retirement, investors will need to begin drawing income from their investments to meet their living expenses.