News & Education

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.

Portfolio Review – Q3 2020 Newsletter

The stock market’s movements so far this year can best be described as weird. That may not be an apt technical definition, but there’s no better way to put it.
The stock market dropped 35% in 31 days, and then recovered all of its losses just five months later. The S&P 500 is now close to its all-time high, which was reached in early September, post-Covid.

Chris’s Corner – Q3 2020 Newsletter

As we enter the final quarter of 2020 many of us start to think of year-end charitable giving. Despite a difficult year for the economy and wild stock market swings, preliminary data from Fidelity and Giving USA suggest that Americans have stepped up their philanthropy, increasing donations by almost 16% so far in 2020. Perhaps that should not be surprising, as it turns out America is the most generous nation when it comes to charitable giving. Per Philanthropy Roundtable, annual private philanthropy in the U.S. represents almost 1.44% of GDP This is twice as high as the 0.77% recorded in Canada, nearly three times as high as the U.K.’s 0.54%, and in stark contrast to China’s 0.03%.

Does the Election Really Matter? – Q3 2020 Newsletter

Vice President Joe Biden says the coming election is a “battle for the soul of the nation.” President Donald Trump has declared this the “most important election in U.S. history.” Perhaps. Or perhaps the nation’s deep partisan divide is just the way the world goes ‘round. Maybe, as John Prine suggests, we’re extrapolating out the worst-case scenarios because that is human nature.

ACM InvestEd – Gold: Attractive Investment or Shiny Distraction? – September 2020

The COVID-19 pandemic resulted in a government-forced shutdown of much of the economy, and subsequently, very large government stimulus packages from nations worldwide. This has amounted to trillions of dollars being pumped into the economy, including $6 trillion in the U.S. alone. Worse, this comes on the heels of massive government spending to help bail out the economy after the 2008 financial crisis, much of which is still sloshing around the global economy.
Many economists fear all this excess liquidity will result in rapid inflation in the years to come. Popular wisdom suggests that gold is a reliable hedge against inflation, and the price of gold has indeed risen recently. We’ve recently fielded a number of questions about gold investments. In our latest ACM VidCast, Mark Armbruster, CFA & Christopher Cebula, CPA, take a look at the merits of gold investments.

Stay the course on investment strategy, even in a narrow market

Here’s today’s dirty little secret that no one wants to talk about: your investment portfolio is likely underperforming the market this year. Worse, you are probably lagging behind school-aged day traders on the new Robinhood trading app.

ACM InvestEd – When Proven Strategies Aren’t Working – A Lesson from Warren Buffett – September 2020

Here’s today’s dirty little secret that no one wants to talk about: Like Warren Buffett, your investment portfolio is likely underperforming the market this year. Worse, you are probably lagging behind school-aged day traders on Robinhood. Why is that?

ACM InvestEd – Investment Fundamentals & Fear of Missing Out – August 2020

What do Sir Isaac Newton and the Kodak (KODK) traders on the Robinhood platform have in common? Join us as we explore the power of investor emotions and the fear of missing out (FOMO) over the commonsense of investment fundamentals.

ACM InvestEd – Stock Splits Explained – August 2020

Apple reported their quarterly earnings last week, and as part of the announcement, they declared a 4-for-1 stock split to be effective August 31st of this year. What does this mean for investors?

ACM InvestEd – Dividends: Investing for Income or Outcome? – July 2020

In today’s ultra-low interest rate environment, it’s tempting for investors to take additional risk to generate the income they need from their portfolios. While that may seem like a rational response to today’s economic realities, there are too many pitfalls with this approach, and focusing on…

Portfolio Review – Q2 2020 Newsletter

The second quarter was marked by a global pandemic, a largely paralyzed global economy, racial tensions that boiled over into violence, heightened political discord, record jobless claims with 40 million people unemployed, continuing business failures, geopolitical tensions with Hong Kong largely being subsumed by China, locusts in India and Pakistan that could result in famine, and even murder hornets in the pacific northwest. So, of course, the stock market rose, posting its best quarterly performance in over 20 years.

Value Stocks: Overdue? – Q2 2020 Newsletter

Making and saving money is hard. Perhaps that is why human beings are wired to look for bargains. We’re constantly looking for sales, coupons, rebates, and discounts. It feels better to know you didn’t overpay for something.

Chris’s Corner – Q2 2020 Newsletter

When the CARES Act was signed into law on March 27th it suspended Required Minimum Distributions (RMDs) from Individual Retirement Accounts (IRAs) for 2020. It also allowed account holders to redeposit any prior distributions up to 60 days from the date of withdrawal. This was good news for many, as it potentially meant a lower tax bill for 2020 since there could be less reportable income.

New Benchmark – Q2 2020 Newsletter

Investment performance needs to be put into context to be truly meaningful. For example, assume you earned a 10% return over some period. Is that good? It seems so at first, but what if all your neighbors got returns of 11%? Or, what if the overall stock market was up 15%? The same return can look different under different assumptions.

Firm News – Q2 2020 Newsletter

Our newest team member is Kim O’Brien. Kim will be helping with reception, account maintenance, cashiering requests, and other service-related duties.

ACM InvestED – Party Like It’s 1999 (Stock Market Déjà Vu) – July 2020

’ve seen a lot of craziness. Just five stocks now account for over 20% of the entire market value of the S&P 500. There’s irrational trading in stocks of bankrupt companies. There’s a lot of highly speculative trading going on by uninformed investors. Interestingly, these are all hallmarks of the 1990s as well when…

ACM InvestED – Rethinking the 60/40 Portfolio – June 2020

The golden age of fixed income is over. That means we have to rethink portfolio management and risk control. The days when investors could rely on traditional bonds as safe, income-producing securities that hedge equity risk and deliver returns that keep pace with inflation are …

Redefining Fixed Income

The golden age of fixed income is over. The days when investors could rely on traditional bonds as safe, income-producing securities that hedge equity risk and deliver returns that keep pace with inflation are finished. While it may not have felt like it, long-term investors had it pretty easy over the last 90-plus years.

ACM InvestED – Portfolio Management & Trading – June 2020

Behind the scenes at ACM – We firmly believe that management and custody should always be separated as a safeguard for clients. Many of you may recall Bernie Madoff, who ran one of the biggest Ponzi schemes in investment history…

ACM InvestED – Value Investing – An Historic Opportunity – May 2020

We’re here today to discuss value investing and what could turn out to be a once in a lifetime opportunity for investors. Value investing is simply trying to buy stocks that are cheap relative to their intrinsic value. Tesla is clearly a growth stock with accelerating sales and growing market share…

ACM InvestED – Active vs Passive Investing – May 2020

The core promise underlying active management is that smart, hard-working investment managers with cutting-edge technology can outperform the overall stock market by actively buying and selling stocks or other investments. Although it seems intuitive that this approach would produce positive results, the evidence indicates…

ACM InvestED – Inflation : A possibility in the near future? – May 2020

We’ve been thinking lately about inflation. It hasn’t been a big factor in the economy in many years, but the topic seems relevant lately with all the government stimulus programs that have recently been announced…

ACM InvestED – Stock Market Drop & Investment Risk – April 2020

We just finished up the most volatile quarter ever for the stock market. The Dow Jones Industrial Average is currently down 24% from its high, but it is also 20% above its recent low, which I think…

Playing the long game can earn your portfolio big rewards

The song “Mr. Bojangles” is a staple on radio stations that feature songs from the 1970s, even though it was written in 1968. Most of us have heard the popular version, by the Nitty Gritty Dirt Band, which hit No. 9 on the Billboard charts. However, the original version by upstate New York native Jerry Jeff Walker is still relatively obscure.

Portfolio Review – Q1 2020 Newsletter

Our discussion of the capital markets for the first quarter could be quite brief: it was bad. However, there are some interesting sound bites worth noting:

What Are Factors? – Q1 2020 Newsletter

Factor-based investing, or what has become known as “Smart Beta” is a strategy that has been prevalent in academic and larger institutional realms for many years. However, it is just recently trickling down to the investment advisor and retail investor world.

Chris’s Corner – Q1 2020 Newsletter

Relief for some is on the way. As during most times of economic stress, our elected officials are racing to roll out multiple programs to help reduce the financial impact to businesses and individuals. Here are a few provisions that have been put into action that may be of help.

Firm News – Q1 2020 Newsletter

Last year was a good one for our firm. We wrote previously about adding Steve Sheflin to our investment team. We’ll likely add another capable body or two in the coming year, and are already interviewing to support our growth.

Compliance Corner – Q1 2020 Newsletter

We are in a highly regulated business, which causes a few headaches, but regulations are largely good; they offer our clients important protections. There are certain disclosures that we are required to make regularly regarding our policies and procedures.

Portfolio Review – Q4 2019 Newsletter

The S&P 500 rose 32% for 2019. Looking at data back to 1926, that was the 18th best year for the stock market, placing it in the top 20% of annual gains. However, that understates the actual achievement, as many of the better years occurred during or in the wake of the Great Depression when stocks fell and rose wildly.

Chris’ Corner – The SECURE Act – Q4 2019 Newsletter

On December 20th, the President signed into law the Setting Every Community Up for Retirement Enhancement (SECURE) Act. The law is intended to increase retirement savings by expanding investment options and changing some of the qualified account rules. The SECURE Act may help some savers, but it comes with some negative consequences for estate planning and inheritors. Let’s look at how some of the changes affect you.

Firm News – Q4 2019 Newsletter

Last year was a good one for our firm. We wrote previously about adding Steve Sheflin to our investment team. We’ll likely add another capable body or two in the coming year, and are already interviewing to support our growth.

Portfolio Review – Q3 2019 Newsletter

The third quarter was mediocre in terms of investment returns. Large-cap stocks in the U.S. were up 1.7%, but most other stocks lost money. Bonds actually outpaced stocks in the third quarter, with a gain of 2.3%. Real estate was the bigger winner, earning 7.3% as investors sought out more stable segments of the stock market. See full investment returns for the quarter and year-to-date in the nearby chart.

Chris’ Corner – Year End Planning – Q3 2019 Newsletter

As the days grow short and foliage begins to change, our thoughts naturally are drawn to year-end financial planning. Maxing out contributions to 401(k) or IRA accounts (2019 limit is $19,000, plus $6,000 catch-up), making sure your beneficiaries are up to date on your accounts, and satisfying your Required Minimum Distributions (RMDs) if you are over age 70.5, are popular items to consider. However, a few lesser known topics are also worthy of consideration:

Firm News – Q3 2019 Newsletter

We are excited to announce that Steve Sheflin is our new Chief Investment Officer. We’re also proud that Colby Feane was recently named as a 2019 Forty Under 40 honoree by the Rochester Business Journal.

401(k) investor plans that use index funds save time and money

The share of 401(k) assets invested in index funds has risen from 17 percent in 2006 to 33 percent in 2016, a recent report from financial data firm Brightscope and the Investment Company Institute shows. While that is impressive growth, the share of retirement assets in index funds should be much larger, probably close to 100 percent.

Portfolio Review – Q2 2019 Newsletter

The second quarter was another strong period for stocks, and surprisingly strong for bonds. Large-cap stocks, as represented by the S&P 500, led the way with a gain of 4.3%. Mid-cap, small-cap, and international stocks all generated respectable returns, but lagged the S&P 500.

Challenging Times Ahead – Q2 2019 Newsletter

A year and a half ago, we wrote articles on how the economy could continue to grow for three more years and the stock market could increase 30% from March 2018. We based our stock market forecast on valuations, despite the fact that many thought stocks were already overvalued.

Firm News – Q2 2019 Newsletter

A year and a half ago, we wrote articles on how the economy could continue to grow for three more years and the stock market could increase 30% from March 2018. We based our stock market forecast on valuations, despite the fact that many thought stocks were already overvalued.

Prospect of Lean Returns For Stocks, Bonds Suggest Getting Creative

Most investors have a mix of stocks and bonds in their portfolios. Stocks are there for long-term growth, whereas bonds are generally purchased for stability and income generation. This has worked out pretty well historically, as stock returns averaged over 10 percent annually since the 1920s, and bonds have yielded over 5 percent, according to Ibbotson data. A balanced portfolio of 60 percent in stocks and 40 percent in bonds has become the de facto standard for many investment portfolios, as the returns have been substantial enough to meet most investors’ returns, while keeping risk in check.

At This Stage of Economic Expansion, Is It Like 1996 or 1999

In a recent interview with CNBC, famed investor Warren Buffett marveled at the current economic environment. He not¬ed that unemployment is at multi-decade lows and the federal budget deficit is at an all-time high, yet inflation and interest rates are historically low. No economics textbook, in Buffett’s estimation, could have predicted such an environment.

Buy-and-rebalance Approach Best Course for Long-term Wealth

The current economic expansion is now 117 months old. Looking at data that goes back to 1854, this is just shy of the record 120-month expansion that occurred from 1991 to 2001. It seems likely we’ll soon exceed the prior record, but how long can the economy continue to grow, and how long can the stock market continue its associated bull run?

Economic and Investment Overview – Q1 2019 Newsletter

Lately, the stock market has been a lot like the weather in Rochester, NY. If you don’t like it, you only have to wait three months for things to radically change. The fourth quarter of last year was one of the worst since the Great Depression. But we didn’t have to wait long for redemption. It arrived early this year, with a 13.6% gain in the first quarter (see market segment returns in the nearby graph).

A True Investment Loss – Q1 2019 Newsletter

Perhaps the fiercest advocate for the individual investor and shareholder rights ever to walk the planet died during the first quarter: John C. Bogle, who preferred to be called Jack by his legion of friends, founder of the Vanguard Group. Jack was best known for launching the first index mutual fund in 1976. This new approach to investing would ultimately revolutionalize the entire industry

Compliance Corner – Q1 2019 Newsletter

We are in a highly regulated business, which causes a few headaches, but regulations are largely good; they offer our clients important protections. There are certain disclosures that we are required to make regularly regarding our policies and procedures.

Portfolio Review – Q4 2018 Newsletter

Stocks posted their worst returns since 2008 last year. Most of the damage occurred in the fourth quarter when stocks dropped 13.5%. This was the 12th worst quarterly performance since the Great Depression.

Should I Stay or Should I Go? – Q4 2018 Newsletter

The stock market declined by 4.4% in 2018. It was the first year stocks posted a loss since 2008. The S&P 500 rose 20% in 2017, 12% in 2016, and more than 13% annualized over the last decade. Yet, a one-year decline of 4% has caused all sorts of consternation. I admit that the peak-to-trough loss was much larger (17.5% so far), and the fourth quarter was one of the worst on record (down 13.5% in just three months).

Alternatives Out Of Focus – Q4 2018 Newsletter

They say all the world loves a clown. That may be true, but one thing I know that is even truer is that all the world currently hates alternative investments.

Flourish Cash Management – Q4 2018 Newsletter

Interestingly, cash was the best performing asset class in 2018, earning 1.8%. That’s a pretty meager return, but it was better than losing money in stocks or breaking even in bonds.

Dying Without a Will Could Cause Hardship for Heirs

Prince, or the artist formerly known as Prince, or whatever his name ultimately was, made headlines throughout his life for his talent and eccentricities. However, the headlines after his death in 2016 revolved around the fact that he died with an estimated $200 million estate and no documents in place to guide its disposition.

True Portfolio Diversification Involves Multiple Asset Classes

The diversification of an investment portfolio has been described as the one “free lunch” in the investment world. That is because holding a portfo¬lio of assets with unique risk and return characteristics can result in higher long-term returns and a lower risk profile.

Sensible Investment Strategies Can Help Weather Gloomy Market Forces

October has come and gone, which is likely a relief for investors. October gets a bad rap when it comes to the stock market, and perhaps deservedly so: It was October of 1929 when the slide into the Great Depression began in earnest with a 20 percent dip in the stock market. It was also October, in 1987, when Black Monday resulted in the stock market falling over 20 percent in a single day. October of 2008 saw stocks decline 17 percent.

Portfolio Review – Q3 2018 Newsletter

The third quarter of 2018 was a mixed bag for investors. Stocks, at least domestic stocks, performed admirably. The S&P 500 rose 7.7% in the quarter and is now up 10.6% year-to-date. Small-cap stocks have performed even better so far this year, rising 14.5%.

Mid-term Elections and the Market – Q3 2018 Newsletter

The mid-term elections are right around the corner. That means that the phone is ringing with questions about how the elections could impact the stock market. Generally, we prefer to keep politics and investing separate, but we grudgingly accept that they can influence one another in the short run.

Firm News – Q3 2018 Newsletter

October 1st was our ten-year anniversary. It is true that Armbruster Capital was incorporated a little over nine years ago. However, Mark started working at our predecessor firm, and building what would become Armbruster Capital, a decade ago.

Eight More Years of Economic Expansion? – Q3 2018 Newsletter

Where is the US economy headed?
Recent news coverage about an inverted yield curve, potential trade wars, and troubles in emerging markets have created some unease.

The US Economy: Eight More Years of Expansion?

Mark Armbruster, CFA. Where is the US economy headed? Recent news coverage about an inverted yield curve, potential trade wars,

Inverted Yield Curve May Not Always Signal Recession On The way

The stock market achieved an all-time high in late January, but then saw a subsequent drop of more than 10 percent. Since then, it has vacillated wildly, reacting to strong economic news, yet also showing signs of concern. The Fed has been raising short-term interest rates, and volatility has returned in earnest. This has set up a “Tale of Two Markets” scenario, which is making investors question if they should get out of stocks altogether.

Portfolio Review – Q2 2018 Newsletter

While it may come as a surprise, the second quarter of 2018 was actually quite strong for stock investors. The S&P 500 rose 3.4%, mid-cap stocks gained 4.3%, and small-cap stocks returned almost 9.0%. Even REITs rebounded in the quarter for a gain of 7.8%.

A Tale of Two Markets – Q2 2018 Newsletter

Certainly, we’re in a divided age currently where the glass could look half full or half empty depending on which side of the political aisle you sit. Unfortunately, that has been true for some time now. The same dynamic is also at play in the stock market.

Financial Exploitation of Specified Adults – Q2 2018 Newsletter

The SEC recently approved two new rules: (1) the adoption of new FINRA Rule 2165 (Financial Exploitation of Specified Adults) to permit members to place temporary holds on disbursements of funds or securities from the accounts of customers where there is a reasonable belief of financial exploitation of these customers; and

Small-cap Value Stocks May Be The Way

Small-cap value stocks have been uniquely poor performers recently. They posted strong returns in 2016, but otherwise, each of the past seven years small-cap value stocks have either significantly lagged or just barely beaten large-cap growth stocks.

Beware of Experts Bearing Forecasts

Mark Armbruster, CFA. I read another article recently that warned of an impending market downturn and cited Nobel laureate Robert J.

Portfolio Review – Q1 2018 Newsletter

Volatility has returned. While stock market returns were truly remarkable in 2017, the good times only continued into late January of this year. Since then, the market declined more than 8% from its peak into the end of the quarter. However, the downturn isn’t the real story.

Alternatives In Focus: Alternative Lending – Q1 2018 Newsletter

We started using the Stone Ridge Alternative Lending fund (LENDX) roughly a year and a half ago. It has returned around 6% annualized since we started investing, which is in-line with our long-term expectations for alternative investments.

Small Cap Value…Time to Shine? – Q1 2018 Newsletter

Small-cap value stocks have been uniquely poor performers recently. They posted strong returns in 2016, but otherwise, each of the past seven years small-cap value stocks have either significantly lagged or just barely beat large-cap growth stocks.

Rising Interest Rates Change Strategies for Investors

Stock and bond market investors watch with trepidation as the Federal Reserve Board determines how much to raise interest rates this year. The Fed has already taken short-term interest rates from roughly zero percent to a target of 1.50 percent to 1.75 percent, and promises further hikes throughout 2018.

The Case For Further Stock Market Gains

Mark Armbruster, CFA. The stock market’s valuation recently surpassed its 1929 peak, and the S&P 500 now trades near the

Caution Flag is Up When Considering Purchase of an Annuity

Perhaps no financial product is more controversial than annuities. At best, an annuity is an insurance offering that provides a guaranteed stream of income that you cannot outlive. At worst, it is a high-cost way to earn subpar investment returns.

Certain Investors May Find Privately Traded REITS to Their Liking

With both stock and bond market valuations at lofty levels, many investors are starting to wonder if they will be able to continue to earn the types of returns they have enjoyed over the past nine years. Continued gains in the stock market would push valuations to potentially dangerous levels, and bond yields aren’t that far north of zero currently.

Current Thinking – Q4 2017 Newsletter

With the exception of Donald Trump and Bitcoin, stock market valuations seem to be making the most headlines these days.

Index Investing – Q4 2017 Newsletter

Index investing was much in the news in 2017. An article in the Wall Street Journal in late November noted that U.S. index funds have seen cash inflows of around $1.7 trillion since 2009, compared with outflows of nearly $1 trillion for actively-managed mutual funds. Another article noted that investors had collectively invested $436.5 billion this year into index funds globally through December 20, according to EPFR Global.

Alternatives in Focus – Q4 2017 Newsletter

While 2017 was a great year for stocks, it was mediocre for alternative investments. The benchmark index we often look at, the HFRI Fund-Weighted Composite Index, earned 8.5% last year. While that isn’t too bad, our alternative investments did not produce returns in that range.

Portal Launch – Q4 2017 Newsletter

With the new technology we implemented last year, we have been able to offer clients a portal to log into their accounts to run various detailed reports on their portfolios. We believe this has been a great success.

2018 Tax Facts – Q4 2017 Newsletter

1.$18,500 maximum salary deferral to a 401(k) or 403(b) plan (up $500 from 2017).

Compliance Corner – Q4 2017 Newsletter

We are in a highly regulated business, which causes a few headaches, but is largely a good thing that offers our clients important protections. There are certain disclosures we are required to make regularly regarding our policies and procedures. A few of them are

Bitcoin phenomenon illustrates importance of rational investing

As of this writing, cybercurrency Bitcoin has appreciated in value in excess of 1,500 percent so far this year. That makes it one of the best performing investments ever, even when considering tulip bulbs in 1636, stock in the South Sea Company in 1720, and internet stocks in the late 1990s. Most of the academic studies written on financial markets start with a few basic premises: investors are rational, they want to maximize returns, and they want to minimize risk. Is it possible that the move in Bitcoin is a rational response to new data that has emerged over the course of the past year? Probably not. Bitcoin remains largely the same from a structural standpoint today as it did a year ago.

Socially Responsible Investing in the US

Today, socially responsible investing, or SRI, accounts for around 25 percent of all managed assets in the U.S. The percentage is even higher in Europe and is rising fast in parts of Asia. SRI investing can take many forms, but the most popular is negative screening. That means excluding companies that participate in undesirable activities, such as the manufacture of tobacco products, weapons or fossil fuels. However…

Study of Stock Bubbles Debunks Theory of Impending Crash

Most of us have seen the recent headlines about the stock market hitting new highs. By some measures, stocks now trade at valuation levels only seen twice before: in 1929 and in 1999. If you recall, the aftermath of those periods was not terribly profitable for investors.

Portfolio Review – Q3 2017 Newsletter

The third quarter of 2017 was one of continued political strife at home, missile launches and increasing tension in Asia, several devastating natural disasters, and efforts by the Federal Reserve to slow the economy. In the face of that, the stock market rose to record highs.

Identity Theft – Q3 2017 Newsletter

By now, everyone is aware of the massive data breach at Equifax. Something like 143 million Americans had their personal information exposed in the hack. That effectively means that every American adult was impacted. You can check to see if you are on the list here: www.equifaxsecurity2017.com. I’ll bet you are.

Alternatives In Focus: Reinsurance – Q3 2017 Newsletter

Our alternative investment portfolio was looking pretty good through August of this year. All of the funds except one were in the black, and returns were on track for around a 6% gain. Then September hit.

The Market Is Going Up – Q3 2017 Newsletter

What if someone told you that there was more upside in the market from today’s levels? What if they said it could rise 4,445% from here?

Tax Planning Time – Q3 2017 Newsletter

As hard as it may be to believe, yearend is just around the corner, and that means it is time to think about tax planning. This year, it seems that year-end tax planning is facing a perfect storm of unknowns.

Firm News – Q3 2017 Newsletter

We may have announced it before, but we recently updated our website. There are a host of resources there, including electronic versions of all our newsletters, articles, and even a few videos. We try to send most of this to you directly, but there are a few items that you likely missed.

Equifax Data Breach 2017 – What can I do to protect myself?

What happened? On 9/7/2017 Equifax announced a massive personal data breach potentially impacting approximately 143 million United States consumers. The

What Happens to the Market if America Goes to War?

Mark Armbruster, CFA. The stock market hates uncertainty, and there is plenty of uncertainty with respect to the tensions over

Portfolio Review – Q2 Newsletter

The rally in investment assets continued in the second quarter of 2017. All major asset classes earned positive returns for the quarter, and most have posted very strong returns year-to-date.

Alternatives in Focus – Q2 Newsletter

We’ve been getting a lot of questions about our alternative investments recently, so we thought we would introduce a new, at least quasi-regular, column in our newsletter  focusing on this asset class. We’ll talk this time about  why we  use alternative investments, but in the future, we’ll do a deeper review of some of the funds.

Firm News – Q2 Newsletter

We recently added a new team member. Craig Julien joined us in early June to help us with our systems, operations, and IT. Craig has a couple decades of experience in the IT industry, most recently with the accounting firm EFPR Group. Accordingly, Craig knows firsthand about data security and the importance of confidentiality in the financial industry. He’s already done a great job of tweaking our systems so they are more efficient and user friendly, and we’re looking forward to some enhancements that will make electronic account access easier for our clients as well.

Stock Indices Important for Gauging Portfolio Performance

Several years ago, I worked with an investment adviser who did not like to show investment performance to his clients. In fact, he never even calculated returns for his managed accounts. He really had no idea or interest in how he was performing, and certainly did not want his clients questioning him about their returns.

Current Events, Even War, Not Good Basis for Investing

Back in 1970, Edwin Starr released a recording of the song “War.” The notable lyrics, “war/what is it good for/ absolutely nothing,” have been quoted often in the 40 years since. However, contrary to Starr’s lines, it turns out there may be one thing that war is indeed good for: the stock market.

2016 Shows Folly of Pundit Predictions

Last year was a year of surprises. Sure the Chicago Cubs won the World Series for the first time in 108 years, Brad Pitt and Angelina Jolie announced that they are dissolving their marriage, but I’m talking about more interesting topics, like those that impacted the capital markets.

Indexing Fares Well Over the Long Term

Standard & Poor’s recently released its biannual study of mutual fund performance. S&P looks at the performance of actively-managed mutual funds versus appropriate stock market indices to see if the funds, as a group, added value for their investors.

Portfolio Review – Q1 Newsletter

The first quarter of 2017 was a solid one for stock investors. Large-cap stocks rose over 6.0% in the quarter, as measured by the returns of the S&P 500 index. Historically, election years and the first year of a Presidential term are the strongest for stocks, and 2017 is shaping up to follow the historic pattern.

Stock Market Valuation

It is conference season, which means we’ve been on the road lately meeting with fund companies and hearing about their latest research. One point that virtually everyone is making these days is that traditional asset classes (stocks and bonds) are richly valued, and likely won’t generate the same level of returns in the future that we have experienced historically.

The ACM Journal 2016 Q4

Portfolio Review The financial markets were a mixed bag in 2016. Despite early volatility, stocks ended the year on a

Performance shades merits of active management

I come to praise active management, not to bury it. Active management has been much maligned recently, including in this column, because of the increasing dominance of index investing over active stock picking.

Indeed, according to estimates from Morningstar, actively managed U.S. stock funds have seen outflows of over $185 billion so far this year. By comparison, U.S. stock market index funds have attracted almost $125 billion in new assets. What’s driving this disparity?

Comparing index mutual funds and active managers

The index fund recently celebrated its 40th birthday. The Vanguard 500 Index Fund, the very first indexed mutual fund, began on Aug. 31, 1976. That might not seem like such a big deal, but consider that during a typical 10-year period, roughly half of all stock mutual funds close their doors. Merely surviving for 40 years is quite a feat, but the fact that the Vanguard 500 Index Fund is now among the largest mutual funds in the world makes it all the more impressive.

In fact, of the 25 largest mutual funds, all but 10 are index funds. Of the 10 non-index funds on the list, only six are actively managed.

The ACM Journal 2016 Q3

Portfolio Review Investment returns in the third quarter were strong and rewarded risk taking. Looking at the U.S. stock market,

Using Alternatives in Client Portfolios

By Murray Coleman September 7, 2016 Mark Armbruster speaks with Murray Coleman on how with low-interest rates and high correlations of other