How the fiduciary standard protects you

You may have heard media reports about a new fiduciary rule for retirement accounts that the Trump administration is trying to rescind. Understandably, you have questions about how this might impact to your accounts. The rule was designed to ensure recommendations made by financial advisors to their clients regarding their retirement accounts are always made in the best interests of the client without any conflicts of interest. This rule was set to go into effect in April, but that is being delayed by 180 days and may be killed entirely.

Wall Street's biggest bull turns bearish

tom lee.jpgFor years, Tom Lee has been known as Wall Street's eternal bull. His S&P targets were virtually always the most bullish on the street. When I reviewed what other strategists were predicting this year and Tom Lee hadn't released his numbers, I just assumed he would be the most bullish on the street, again. Perhaps we should check to see if Tom Lee has been abducted by aliens and replaced by a clone because Tom Lee is the most bearish strategist on the street with a S&P target of just 2275.

Will the stock market boom or bust in 2017?

As we near a close to 2016, it is time to look forward to 2017. We have done this in 2014, 2015, and 2016 so it is becoming a tradition to see which strategists did well and which missed the mark. What do the experts think will happen in 2017 and should we even care?medium_728933695

Perhaps you are familiar with Philip Telock's landmark UC Berkeley study that looked at 82,000 predictions over 25 years by 300 leading economists. It turned out that their so called expert views were no better than random guesses, and worse, the more famous, the less accurate the prediction.

Last year, the strategists predicted a bull market for 2016 and they almost hit the number right on the mark. Their average forecast was for a 7.2% gain in the S&P 500 to 2215. They should get a round of applause as the S&P finished at 2239. Well done. Deutsche Bank's David Bianco gets the highest grade with a forecast of 2250, only missing by 11 points. Barclays' Jonathan Glionna should also be given a trophy as he was within 2% for the past couple of years. Let's look at the numbers.

Are stock market apps making you a bad investor?

stock-624712_960_720.jpgIt wasn't so long ago when people would check stock prices in the newspaper with their morning coffee. You could check your portfolio once a month when your account statement would arrive in the mail.

Fast forward to today and thanks to the internet and phone apps, you can check your investments up to the second. However, is having so much data at your fingertips making you a bad investor?

Per a recent Wall Street Journal article, the answer for many people is yes -- for the simple reason that they tend to make investment decisions based on short-term losses in their portfolio, ignoring their long-term investment plan. Behavioral economists call that tendency "myopic loss aversion" and this is an increasing problem in todays always connected world.

Economic Data Says Market Can Go Higher

bullish-market.jpgStocks continued to move up last week as all major U.S. indices hit new highs. Investor optimism rose as expectations for deregulation, possible tax cuts and fiscal stimulus under the new administration accelerated. These same factors put upward pressure on bond yields and the U.S. dollar. A strong Dollar has historically been good for the stock market. The reasoning is simple. If you are a European or Japanese, would you leave your money in a bank which takes a piece of your money given negative interest rate policies; or would you rather send your money to the US where we have positive interest rates and a rising stock market?

Tom Lee: Republican "Revolution" Could Extend Bull Market

tom lee.jpgRunnymede has been bullish on the stock market since early July because of improving earnings and good value relative to fixed income. As we ahead to 2017, we remain positive. Former JP Morgan Chief Equity Strategist Tom Lee shares our enthusiasm for equities in a recent interview on CNBC.

8 Days Later: Trump effect on financial markets

trump-financial markets.jpgIt's been 8 days since the Presidential Election and financial markets have had quite a wild ride. On election night, S&P futures traded down limit of -5%. It appeared that markets would react strongly to the downside much like after the Brexit vote. However, the markets quickly digested the surprising Trump decision and markets have traded sharply higher on hopes that Trump's policies will be inflationary and stimulate the economy. While it is too early to tell what he will be able to accomplish, financial markets have wagered some early bets on who the winners and losers will be. The early winner is financial stocks. Trump is widely expected to roll back the regulations of Dodd-Frank which were enacted after the financial crisis of 2008. Financials are also benefiting from the rise in long term interest rates which benefits their net interest margin and equals larger profits. The sharp move in interest rates caused headaches for high dividend stocks which were the hardest hit with REITs, consumer staples and utilities all in the red.

S&P on track to post best earnings since 2014

As we move past Election Day, financial markets should be able to refocus on what truly matters: company fundamentals. This should serve as a catalyst to push equity prices higher with earnings finally back on the rise. It has been a tough period for earnings because of the strength in the US Dollar and extreme volatility in crude oil prices. This trend appears to have finally stabilized. The energy sector is expected to post a flat quarter after posting huge losses for the previous four quarters.

The 2016 Presidential Election and the Stock Market

Halloween has come and gone. My two witches and one Ghost Buster put in an impressive two hours of trick or treating in our neighborhood and have the candy to prove it. Yet, people are nervous. At least judging by the frequency of questions we're asked about the implications of the upcoming Presidential election, it's the two "ghouls" staring down November 8th that have investors more scared than in any other election of my lifetime. With less than a week to go before heading to the voting booths, here's a little data and perspective.

QE side effect: Corporations are getting paid to borrow

side_effects.jpgWe have all seen pharmaceutical commercials on TV where a listing of common side effects may include diarrhea, nausea and drowsiness. In today's financial markets, central banks are expanding their balance sheets by trillions of dollars annually and new side effects are on the way. This week saw a new milestone in the world of negative interest rates, when Henkel and Sanofi became the first public companies to sell new Euro bonds for more than the buyers will get back.

IMPORTANT DISCLOSURE INFORMATION

Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by Runnymede Capital Management, Inc.), or any non-investment related content, made reference to directly or indirectly in this blog will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained in this blog serves as the receipt of, or as a substitute for, personalized investment advice from Runnymede Capital Management, Inc. To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing. Runnymede Capital Management, Inc. is neither a law firm nor a certified public accounting firm and no portion of the blog content should be construed as legal or accounting advice. A copy of Runnymede Capital Management, Inc.’s current written disclosure statement discussing our advisory services and fees is available for review upon request.