What does the fiduciary rule mean? 6/11/2017

Last week, we compared the performance of the main indexes to see which performed the best/worst to compare with your portfolio asset allocation.

Today we begin a new series on the fiduciary-conflict of interest Rule, and I answer questions on what it is and how retirement investors are affected.

Question: What is the fiduciary-conflict of interest rule?

Answer: It is legislation, crafted during the Obama administration, focusing on eliminating conflicts of interests from financial advisers, brokers and insurance planners.

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Past performance does not predict returns. 6/4/2017

Last week, we identified the current “Big Five” stocks to see if they were signaling a market top. The answer was no.

So, today, I have designed a chart to compare the performance of the main indexes plus precious metals and oil. The reason is to see which indexes performed the best and worst in comparison to your portfolio asset allocation.

The chart shows performance total returns (price and dividends) from the recent Bear market bottom March 2009 (the chart above shows April 2010) through May 2017. The green shaded area represents the Standard & Poor’s 500 returns.

Did the ‘Big Five’ give us signs in 2007? 5/21/2017

Last week, we learned the importance of market capitalization and answered the question: With the S&P 500 making new highs, what is really driving this market?

Today, I look back to the “Big Five” stocks in 2007 to see if they gave us signals regarding the market top.

 In the beginning (Q1) of 2007, the Big Five, the largest market cap stocks (per etfdb.com) in the Standard & Poor’s 500 were Exxon Mobil (XOM), General Electric (GE), Microsoft (MSFT), Citigroup (C) and Bank of America (BAC). The price action of the top five market cap stocks can heavily influence the movement of the index up or down.
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What is really driving the market? 5/14/2017

This week, I promised to show which type of investments performed the best since March 2000. But, instead, I will answer a more timely question: With the S&P 500 making new highs, what is really driving this market?

Let’s look at a Wall Street term “market capitalization” to determine the equity value (size) of a company. Market cap, for short, is determined by multiplying the total number of shares by the price. This number tells us if the stock is a large, mid or small cap stock.

 “Market index” is used to calculate the performance of a group of stocks. The three major U.S. indexes are the Standard & Poor’s 500, Dow Industrials and the NASDAQ 100.

Know your numbers — it will help. May 7, 2017

Last week, I introduced important analytical terms (nominal and real) and tested the Wall Street mantra, “Don’t worry, the market will always come back.” We discovered when using real inflation-adjusted data, not all markets recovered from their 2000 highs. The Nasdaq is down 17 percent.

Here’s the action point — after learning the difference between nominal and real data, analyze your monthly brokerage statement. Are your investment values represented with nominal data, real data-adjusted for inflation, or better yet do you see the net (price minus total expenses)?

Today, we will add a security with dividends to the chart to see if they make a difference.

Does the market ‘always’ come back? April 30, 2017

My goal today is to introduce important analytical terms (real and nominal), and then test the Wall Street saying, “don’t worry, the market will always come back,” a popular mantra to convince investors to be in it for the long run.

I have charts designed by one of the best in the business, Doug Short from dshort.com, showing the percent change of the major indexes from their 2000 peaks.
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Southern Business Journal Article, April 22, 2017

CARBONDALE — When David O. England was 12, he had an accident that left him temporarily paralyzed from the arms down.

He was left wondering what he was going to do. He had his “childhood stolen,” England said.

“I got up back running and walking, but it planted a seed,” England said. “If I ever get back into that chair, I’m going to be prepared that I can make a living for my family. I was going to perfect a craft so I can provide for and excel at for my family.”

He worked at that craft and founded the Eye on the Market Training Academy. He also was an associate professor of finance at John A. Logan College for more than 25 years.
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