LOFY GROUP NEWSLETTER
10/18/2021
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In This Issue
The Markets

Pumpkins and Tombstones and Zombies, Oh My!

Thought for the Week
The Markets
Don’t get spooked!
 
Barron’s Big Money Poll is an exclusive survey of market sentiment among professional investors. Last week, Nicholas Jasinski reported on 2021’s findings:
 
“America’s money managers are optimistic about the long-term outlook for the economy, the financial markets, and the recovery from the [COVID-19] pandemic. It’s the short-term prognosis that concerns them. Monetary and fiscal policies are in flux. Supply-chain bottlenecks and labor shortages are igniting inflation and threatening corporate profit margins, and the economic recovery from 2020’s recession –so robust until now – is decelerating. Add pricey stock valuations and rising bond yields, and the immediate future suddenly looks more challenging than the recent past.”
 
Among those surveyed by Barron’s, half are bullish about prospects for the next 12 months, down from 67 percent last spring. Twelve percent are bearish, up from seven percent last spring, and the rest are neutral. Fifty percent said stock markets are fairly valued at current levels, and 80 percent anticipate a stock market correction – a drop of about 10 percent from a recent high – during the next six months.
 
Market corrections are not all that unusual. The average correction lasts a few months, reported James Chen on Investopedia. That’s long enough, though, for loss aversion to kick in. Research has found that, psychologically, the pain from loss is twice as powerful as the pleasure from gain. As a result, when markets decline, loss aversion causes some investors to wonder whether they should make changes to their investment strategies and that can have a negative impact on long-term financial goals.
 
There is no way to know whether a correction is ahead. That said, if a market downturn has you wondering about your investment strategy, please get in touch. We can discuss whether changes should be made.
 
Last week, major U.S. indices finished the week higher, and the yield on a 10-year U.S. Treasury moved lower.
S&P 500, Dow Jones Global ex-US, Gold, Bloomberg Commodity Index returns exclude reinvested dividends (gold does not pay a dividend) and the three-, five-, and 10-year returns are annualized; and the 10-year Treasury Note is simply the yield at the close of the day on each of the historical time periods.
Sources: Yahoo! Finance, MarketWatch, djindexes.com, London Bullion Market Association.
Past performance is no guarantee of future results. Indices are unmanaged and cannot be invested into directly. N/A means not applicable.
Pumpkins and Tombstones and Zombies, Oh My!
Americans expect to spend more than $10 billion on Halloween this year, according to the National Retail Federation. That’s about $103 per consumer, although families with children spend well-above average on the spookiest night of the year.
 
Not all of them pay full price, though.
 
A purveyor of discounts dug deep into its data graveyard and unearthed the states that are most possessed by Halloween spirit. States that have been spellbound by…horror of horrors…the magic of Halloween coupons.
 
The spookiest section of the United States is the South, where residents purchased 37 percent of the Halloween coupons sold across the land. Southerners jumped at the opportunity to buy costumes, ghost hunts, haunted house tickets and haunted tours at low, low prices. The epicenter of the devilry was Louisiana, which accounted for 29 percent of the company’s coupon sales. The Bayou State also is home to New Orleans, which is purported to be one of the most haunted cities in the world.
 
The South has a taste for spooky estates to rival that of the West. Californians howl for haunting, having purchased the majority discounted ghost tours sold in the western U.S. and one of every five sold in the entire nation. The Sunshine State is also home to the infamous Winchester Mystery House, an architectural wonder that was under construction from 1886 to 1922, when its owner, Sarah Winchester, died. Rumor has it, the firearms heiress expanded continuously to keep her fear of ghosts at bay.
 
Sarah Winchester was originally from the Northeast, a region with a frugal reputation, although its residents purchased less than a quarter of the Halloween coupons sold across the country. Of course, if you crack the code, you’ll discover the chilling truth…Northeasterners purchased the most coupons per capita over the last five years!
 
The real secret, though, is that a district – not a state – is the biggest consumer of Halloween discount offers. That’s right, on a per capita basis, Washington D.C. consumes more spooky coupons than any state in the country.
 
Notably, the Midwest had relatively little hunger for Halloween coupons. That may be because trick-or-treating isn’t quite the same when a costume must fit over, or be covered by, a winter coat.
Weekly Focus - Think About It
“We make up horrors to help us cope with the real ones.” 

--Stephen King, author 
Best regards,
 
Lofy Group Wealth Management
  
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* This newsletter was prepared by Peak Advisor Alliance.
 
* The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general.
 
* The DJ Global ex US is an unmanaged group of non-U.S. securities designed to reflect the performance of the global equity securities that have readily available prices. 
 
* The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.
 
* Gold represents the London afternoon gold price fix as reported by the London Bullion Market Association.
 
* The DJ Commodity Index is designed to be a highly liquid and diversified benchmark for the commodity futures market. The Index is composed of futures contracts on 19 physical commodities and was launched on July 14, 1998.
 
* The DJ Equity All REIT TR Index measures the total return performance of the equity subcategory of the Real Estate Investment Trust (REIT) industry as calculated by Dow Jones.
 
* Yahoo! Finance is the source for any reference to the performance of an index between two specific periods.
 
* Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
 
* Past performance does not guarantee future results.
 
* You cannot invest directly in an index.
 
* Consult your financial professional before making any investment decision.
Sources:
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