Broker Check


July 30, 2015

Welcome to our very first blog post. We hope to write a post every month that will recap what went on in the markets and our thoughts of the economy and markets in general. You will never see us make predictions here, so don’t take any of our comments as such. We hope to give you some insight as to what we think about the markets and Our Opinion on what is currently happening. We hope you enjoy these. If you have any comments or suggestions please feel free to reach out to us.

The month of July brought a good bit of volatility to the equity markets. The S&P 500 Total Return Index ended the month with a 2.10% gain and as of July 31st it was up 3.35% YTD. Even though it ended the month with a positive gain it did reach a low of 2,044.02 on July 7th which took the index negative for the year. The Barclays US Aggregate Bond Index was up 0.70% for July and is now up 0.59% YTD. The US Bond Market has been relatively volatile as well this year. It gained as much as 2.2% back in January and again in April but it turned negative for the year in June before turning positive again last month. This year there has been opportunity overseas. The MSCI EAFE index is up 7.72% YTD and was up 2.08% for July. Also, last week the first estimate of second quarter GDP came out at 2.3%. The first quarter GDP figure was revised to 0.6% from a -0.2%. These numbers were overall positive for our economy.

The economic news has been positive overall for 2015. We are almost 6 years removed from “The Great Recession” with the S&P Index having double digit returns every year since, except for 2011. While the economy has been steadily improving we believe there is a heightened risk in the equity markets. Based on our Market Health Report the market has shown weakness since the first week in June. We took a defensive play in our discretionary portfolios and still have those positions as of this writing. Based on our data points the equity markets are still exhibiting signs of weakness.

While we do think the equity markets exhibit a higher risk at this time, we do think there is opportunity going forward. If a pullback does occur, we will see that as a great opportunity to buy and expect the pullback will be short lived and not the start of another bear market. We do think there is a lot of opportunity in the International Markets especially some parts of Europe and some Emerging Markets. There is also value to be found in some of the fixed income markets. We still like Municipal Bonds because of their tax advantages and Investment Grade Corporate Bonds. If the Fed decides to raise rates in September it could be a good time to buy if there is a selloff in the bond market. There is also opportunity in the alternative space. We use this space as a diversifier in our overall portfolios. Multi- Family and Senior Housing are two areas of opportunity in this space.

Overall, we think the economy is continuing to improve, which will lead to the Federal Reserve to raise rates at their next meeting in September. We believe the markets will continue to experience volatility for the next couple of months. We believe there will be opportunity to add to some of our positions going forward but will not do so until the Market Health improves. The risk in the equity markets is currently higher than we would like so we will remain cautious and continue to use alternatives to mitigate the risk in the equity markets.

* Please do not take this information as advice. All of our client’s recommendations are based on their personal financial plan and their individual needs. If you would like more information on how we help our clients please go to our website at All index return numbers were obtained from Morningstar. GDP numbers are from the US Dept. of Commerce- Bureau of Economic Analysis. Investors cannot invest directly in indexes. The performance of any index is not indicative of the performance of any investment and does not take into account the effects of inflation and the fees and expenses associated with investing.