Blog Posts tagged "volatility"

Income Report Card | April 2017

Author: Nathan Rowader
Date: April 7, 2017
Category: Asset Allocation, Financial Planning
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March strongly favored foreign stocks over domestic stocks. International developed stocks increased by 2.8%, slightly outperforming emerging market (EM) stocks, which increased by 2.5%. U.S. stocks managed to finish the month with a slightly positive return of 0.1%. Overall, U.S. markets didn’t favor income-producing stocks, as utilities, U.S. real estate and MLPs all declined during March. Global bonds increased by 0.2% during the month with foreign bonds outperforming domestic bonds. International and emerging market sovereign bonds increased by 0.3% and 0.4%, respectively, while U.S. Treasurys fell -0.1%. Even credit-sensitive sectors such as high-yield corporate bonds fell -0.2%.

Income Investing in an Uncertain World | Part 4

Author: Nathan Rowader
Date: March 10, 2017
Category: Alternatives, Financial Planning
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In the third part of this series, we extended our simple ranking system to include risk targeting. This extended analysis produced a portfolio that could deliver higher risk-adjusted returns than a simple ranking system and still deliver a yield in excess of the Bloomberg Barclays Global Aggregate Bond Index. In the final part of this series we will look at the same strategy and examine its sensitivity to changes in interest rates.

Income Investing in an Uncertain World | Part 3

Author: Nathan Rowader
Date: March 10, 2017
Category: Alternatives, Financial Planning
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In the second part of this series, we outlined how a simple ranking system, using yield and momentum as ranking data points, can provide current income in excess of Bloomberg Barclays Global Aggregate Bond Index with a level of risk similar to the index. This process solved the problem of excess risk in a simple buy and hold strategy of high current income asset classes. For the most part, an investor could simply stop at the ranking system and likely get what they need to achieve their financial objectives. But can we improve on the simple ranking system? Yes we can!

Income Report Card | March 2017

Author: Nathan Rowader
Date: March 8, 2017
Category: Asset Allocation, Financial Planning
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U.S. stocks led global markets in February with the S&P 500 Index increasing by 3.97% and the Russell 2000 Index gaining 1.93%. This disparity could mark the end to a period of very strong relative performance for small-cap stocks versus large-cap stocks, or it could just be a lull in an otherwise strong trend.

Income Report Card | February 2017

Author: Nathan Rowader
Date: February 16, 2017
Category: Asset Allocation, Financial Planning
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Emerging market (EM) stocks increased by 5.48% during the month of January, as measured by the MSCI Emerging Markets Index. This gain is a continuation of the strong performance in 2016 and helps bolster the case that the emerging markets may be heading toward a better return cycle relative other markets.

Income Report Card | January 2017

Author: Nathan Rowader
Date: February 10, 2017
Category: Asset Allocation, Financial Planning
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Assuming you believe the case for economic growth highlighted above then which markets should benefit? As of right now, the least expensive markets are in the emerging markets including Russia, China, South Korea and India. Additionally, many of these same countries have the wind at their back with strong momentum. Meanwhile, some of the most expensive markets are developed countries such as the United Kingdom, France, Canada, Italy and Spain. Which are also exhibiting very weak momentum. A combination of poor valuation and a lack of investor enthusiasm usually spells trouble.

Volatility Control Is a Feature, Not a Bug

Author: Roberto Croce
Date: September 8, 2015
Category: Macro Trends
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At the risk of giving specious arguments more attention than they deserve, my team and I would like to respond to several written reports speculating that risk parity strategies are systemically risky and amplify downside market volatility.

Managing Risk With Moving Averages | Part 3

Author: Nathan Rowader
Date: March 24, 2015
Category: Financial Planning
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In part 1 of this blog series, we looked at using simple moving averages as a guide to determining an allocation to stocks or bonds. The results of our simulation showed that investors can improve their risk-adjusted returns by incorporating a more active approach into an otherwise static investment process.


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