The Independent Investor
May 2017: Strategies for Managing Your Assets
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Dear Clients and Friends:
Volatility is back!  After 15 consecutive days with little movement, the S&P 500 suffered its worst one-day performance in nearly a year, falling 1.8% after markets changed their tune yesterday; no longer shrugging off political uncertainty in Washington. The Dow suffered similar losses, while the Nasdaq and Russell 2000 were hit harder, losing 2.6% and 2.8%, respectively. The VIX measure of implied stock market volatility spiked >40% to 14+.  How concerned should we be?   
Read Market Commentary below
Rachel Wagner
Each market index tracks a representative sampling of stocks, bonds or other securities that may be similar to the holdings in a given investment portfolio. In order to use benchmarks accurately, you should always compare apples to apples. It helps to be familiar with a variety of benchmarks and the sectors and asset classes they track.
Here are the facts. Generally speaking, women earn less than men, live longer than men, and often take time out of the workforce to have children and/or to care for an aging parent or sick loved one. The potential consequence of these realities ? While most U.S. workers are facing a retirement  savings deficit, for women, the effect is compounded: Lower pay translates into reduced Social Security benefits, smaller pensions, and less retirement  savings. 
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We all get that nagging feeling that the money we want to spend on someone and something we love should be saved instead. Here is the counterargument.
MarketMarket Commentary
Yesterday the financial markets experienced a sell off after a long ascent. Here are some important things to think about.
  • One key question is: how much of the market's rise has been politics/ policy-related, versus grounded in fundamentals?   While yesterday's sell-off may have a little more to go, we try to focus on market fundamentals. Corporate earnings growth both domestically and overseas has been strong over the last quarter. Economic growth, inflation, interest rates, corporate sales, profit margins, and earnings all suggest the economy remains robust and the current bull market has not run out of steam.
     
  • Similarly, the bond market has garnered support from central bank actions globally and low interest rates overseas. Further gains in the bond market for 2017 may be muted but high-quality bonds still provide balance for the portfolio.
     
  • Policy and geopolitical risks should be monitored, but so far have had only a marginal impact on the market's fundamentals. We remain diversified and disciplined in our long-term investing plans for you, and encourage you to stay the course.
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