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By Bob Barber
So far this year is turning out to be much like last year for overall bond and stock markets. As of this writing (May 31, 2016) the S&P 500 trailing one year return (May 31, 2015 through May 31, 2016) is right at break even not including dividends (Google Finance).
Our fee based managed tactical accounts:
- Have been fully invested for several months now after holding large cash positions for much of last year, and through the middle of February and March of this year.
- Overall, stocks and bonds continue to move sideways with no clear up or down direction.
- We will stay fully invested in the markets as long as our stock and bond holdings move sideways since our portfolios are making good dividends from the stock holdings averaging in the 3-4% range on an annual basis, and interest from high yield bond holdings averaging in the 5-6% range on an annual basis.* Even with no price appreciation, dividends from our stocks, and interest from our bonds, beat very low bank CD rates that are prevalent today.
- Any appreciation of our stock or high yield bond positions will add to the dividends and interest already being generated, possibly increasing overall returns substantially.
- Our tactically managed portfolios were heavily in cash during the two major 10% downturns that occurred in August of last year and again in January of this year.
We continue to monitor the markets daily striving to make the best returns possible in such a sideways market. The number one headwind we all are facing is political uncertainty with the elections. Other headwinds in the markets include interest rate uncertainty, oil prices, and China’s economic problems.
*Figures from Workstation, powered by Envestnet Asset Management financial planning software as of 5/16/16.
Investing involves risk including the potential loss of principal. No strategy or product can assure success or protects against loss. Past performance is no guarantee of future results. Dividends are not guaranteed and the dividend yield may fluctuate.
The S&P is a market-cap weighted index composed of the common stocks of 500 leading companies in leading industries of the U.S. economy. You cannot invest directly in an index.[/vc_column_text][/vc_column_inner][/vc_row_inner][/vc_column][/vc_row][vc_row top=”20px” bottom=”10px”][vc_column][vc_column_text css=”.vc_custom_1464812739359{padding-bottom: 25px !important;}”]
Click below to read other articles from the Christian Financial Advisors® June 2016 Newsletter
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Market Emotions
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Your Market Update
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The 4 Uses of Money
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Happy Father’s Day
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It’s Vacation Time!
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Family Arc
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Market Update
After being defensively positioned with low exposure to equities in our fee based tactically managed portfolios since July 2015, we finally returned to full exposure to the stock and bond markets last month.
Our tactical exit strategy helped to protect our managed accounts from two major downturns that occurred in the stock markets in August 2015 and again in January 2016, enabling our clients to instill confidence in their investments.
We are pleased to announce that at the time of our re-entry to the markets, the S&P 500 equity index was at lower valuation than it was when we exited last July.
We value the trust our clients place in us to manage their portfolios. We will continue to be diligent in assessing market trends and management strategies to maintain that trust.
*You cannot invest directly in an index[/vc_column_text][/vc_column_inner][/vc_row_inner][/vc_column][/vc_row][vc_row top=”0px” bottom=”0px”][vc_column][vc_row_inner][vc_column_inner][vc_column_text]
Check out our other newsletter sections below:
[/vc_column_text][/vc_column_inner][/vc_row_inner][vc_row_inner css=”.vc_custom_1459541121828{padding-top: 10px !important;padding-right: 10px !important;padding-bottom: 10px !important;padding-left: 10px !important;background-color: #f2f2f2 !important;}”][vc_column_inner width=”1/3″][vc_heading title=”The Messenger Newsletter” subtitle=”Retirement Edition”][vc_empty_space height=”10px”][vc_single_image image=”4476″ img_size=”full” alignment=”center” onclick=”custom_link” link=”/2016/04/01/april-2016-e-newsletter/”][/vc_column_inner][vc_column_inner width=”1/3″][vc_heading title=”Are You Fit To Retire?” subtitle=”By Bob Barber”][vc_empty_space height=”10px”][vc_single_image image=”4474″ img_size=”full” alignment=”center” onclick=”custom_link” link=”https://www.ciswealth.com/2016/04/01/are-you-fit-to-retire/”][/vc_column_inner][vc_column_inner width=”1/3″][vc_heading title=”Office Mascot Athena” subtitle=”Gets Put To Work”][vc_empty_space height=”10px”][vc_single_image image=”4473″ img_size=”full” alignment=”center” onclick=”custom_link” link=”https://www.ciswealth.com/2016/04/01/athena-news/”][/vc_column_inner][vc_column_inner][vc_empty_space height=”30px”][/vc_column_inner][/vc_row_inner][/vc_column][vc_column][vc_row_inner css=”.vc_custom_1459541131163{padding-top: 10px !important;padding-right: 10px !important;padding-bottom: 10px !important;padding-left: 10px !important;background-color: #f2f2f2 !important;}”][vc_column_inner width=”1/3″][vc_heading title=”Tactically Managed Accounts” subtitle=”Market Update”][vc_empty_space height=”10px”][vc_single_image image=”4479″ img_size=”full” alignment=”center”][/vc_column_inner][vc_column_inner width=”1/3″][vc_heading title=”Is Retirement All It’s Cracked Up To Be?” subtitle=”Maybe. Maybe Not.”][vc_empty_space height=”10px”][vc_single_image image=”4477″ img_size=”full” alignment=”center” onclick=”custom_link” link=”https://www.ciswealth.com/2016/04/01/is-retirement-really-all-its-cracked-up-to-be/”][/vc_column_inner][vc_column_inner width=”1/3″][vc_heading title=”Habitat For Humanity Volunteer Day” subtitle=”The First of 2016″][vc_empty_space height=”10px”][vc_single_image image=”4475″ img_size=”full” alignment=”center” onclick=”custom_link” link=”https://www.ciswealth.com/2016/04/01/first-2016-habitat-for-humanity-volunteer-day/”][/vc_column_inner][/vc_row_inner][/vc_column][/vc_row][vc_row top=”0px” bottom=”20px” bg_color=”#163463″][vc_column][vc_column_text css=”.vc_custom_1454043641862{padding-bottom: 15px !important;}”]
Refer A Friend
[/vc_column_text][vc_row_inner css=”.vc_custom_1454103438200{border-right-width: 20px !important;padding-left: 15px !important;}”][vc_column_inner width=”1/2″][vc_single_image image=”4076″ img_size=”large” alignment=”center”][/vc_column_inner][vc_column_inner width=”1/2″][vc_column_text]Do you have a friend, family member, or colleague that could benefit from our services? If so, refer them to our mobile friendly website, or we have a packet of information we would love to share with them to them. Just call our office at 830-609-6986 and we can get out the information to help your friends![/vc_column_text][/vc_column_inner][/vc_row_inner][/vc_column][/vc_row]