Where is Your Portfolio?

Most Americans are more comfortable investing in the U.S. instead of overseas. We understand that, but we think that your investment goals should override your pre-conceived ideas about either the U.S. or international markets.

If you avoid international markets, you are limiting yourself to only about 33% of the world’s investing opportunities by forcing your portfolio to stay U.S.-centric. The U.S. market is expensive right now, and we think that international markets are a great option for investors to start looking at.

This week, your homework assignment is this: what is your overseas exposure? Where is your portfolio? If you are avoiding growing sectors like the emerging markets and other international opportunities because of a mental block or emotional response, we encourage you to revisit those positions and consider a small position through an international ETF.

If you need help looking at international markets, please look at our most recent ETF snapshot on our special reports page. Also, please feel free to call our offices at 800-391-1118 for help with any questions and suggestions for smart international investing.

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Doug’s Wealth Coaching in Palm Springs

April 30th, 2014 Doug will be back in the Palm Springs area for in-person wealth coaching. If you live in the Coachella valley and are interested in one of the few remaining slots in his schedule, please call our offices to set that up: 800-391-1118.

Also, don’t forget that you can still sign up for the Las Vegas Money Show in May. Doug will be giving several presentations and we’d love to see you there.

Remember that holding on to cash is not really an investment strategy. If you are hanging on to cash because of fear, please call our offices and let us help you with a personalized wealth coaching session with Doug. We will look at your asset allocation: stocks, bonds and cash – and help you make a strategy for the future and stay ahead of market action.


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Look at Your Portfolio Objectively

Here are a few good questions to for every investor to ask yourself, as you look at your portfolio:

  • Are you too focused on U.S. equities?
  • Do you own emerging markets?
  • What do your bond holdings look like?
  • Have you made adjustments to your portfolio in light of recent market events?
  • Do you have international exposure?
  • Are you over-exposed to under-performing areas of the market?
  • Are you investing in things that are stalling out or taking off?

If you don’t know the answers to these questions, or if you are trying to figure out your next move for investing, please call our offices for a free consultation: 800-391-1118.

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Blog from Lance Roberts: No One Rings the Bell at the Top

Today, we want to point out a very valuable blog-post from Lance Roberts.

Here’s a great quote from the piece:

“The current levels of investor complacency are more usually associated with late stage bull markets rather than the beginning of new ones. Of course, if you think about it, this only makes sense if you refer back to the investor psychology chart above.

The point here is simple. The combined levels of bullish optimism, lack of concern about a possible market correction (don’t worry the Fed has the markets back), and rising levels of leverage in markets provide the ‘ingredients’ for a more severe market correction. However,  it is important to understand that these ingredients by themselves are inert. It is because they are inert that they are quickly dismissed under the guise that ‘this time is different.’

Like a thermite reaction, when these relatively inert ingredients are ignited by a catalyst they will burn extremely hot. Unfortunately, there is no way to know exactly what that catalyst will be or when it will occur. The problem for individuals is that they are trapped by the combustion an unable to extract themselves in time. “

Please read the whole thing here.

If you’re concerned with your portfolio and would like our professional opinion on your investments, please call our offices at 800-391-1118.

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Video Update: Yellow Warning Light for Stocks

If you were looking for a reason to be cautious about the financial markets, then last week offered you one giant yellow light.

The selling in domestic stocks nearly across the board pushed the major US averages below their 50-day moving averages last week, a first salvo in what could well be a wider selloff. Now, losing the 50-day average does not mean that this current bull market is over, or that US stocks have now headed into a downward spiral.

Yet the breakdown in the domestic equities last week does require you to take a look at how much equity exposure and risk you have in your portfolio.

Keep in mind that every significant market pullback over the past 15 months has actually been a buying opportunity. If recent historical trends continue, then the yellow warning light we saw last week may also be a buy signal. However, we suspect the characteristics of this current pullback should make even the most ardent bulls a little worried.

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High-Frequency Trading Information and Resources

Here’s some of the resources that Doug has been looking at in regards to high-frequency trading – a topic that’s getting a lot of air-time in the media lately.

Michael Lewis on 60 Minutes

Mark Cuban – The Idiot’s Guide to High-Frequency Trading

Charles Schwab on High-Frequency Trading

For more of Doug’s views on this topic – check out the podcast and this week’s video.

To protect yourself, consider owning multiple asset classes, and prepare yourself for higher market volatility. If you have questions or concerns on this issue, please email Doug at askdoug(at)dougfabian(dot)com.

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Video Update: Interest Rates Remain Low

Good news: interest rates remain low, and we believe this will be the case for a while, despite popular opinion in the other direction. Low interest rates are good for real estate, stocks, bonds and other investments.

The emerging markets are breaking above their 200-day average, and that’s in large part because of low interest rates – which is another good sign for the markets.

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Emerging Market ETFs

Check out our new ETF snapshot report here. You can see where money is flowing, where the most assets are, and what we suggest to invest in the emerging markets. ETFs are a great value and an easy way to invest in complex infrastructure like emerging markets.

Check out these funds:

  • VWO
  • EEM
  • FXI
  • DEM

We’re looking at emerging markets because they typically perform on-par with the U.S. market, but they have been under-performing for the last four years. They’re finally breaking out lately, and we think they’ll just keep getting better and be a great move for investors.

Emerging market companies tend to have higher dividends than U.S. companies and be a good value. They also did terribly in 2013 compared to the U.S., and this caused many investors to get out of those markets – this means an opportunity for savvy investors. We think that you should seriously consider our new ETF snapshot on the emerging markets.

If you have questions about these investment ideas, please call our offices at 800-391-1118 and listen to the full podcast here for more information.

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Winning Investment Strategies for 2014

We are seeing three winning investment strategies for 2014:

  1. North American Energy
  2. Precious Metals
  3. Emerging Markets

If commodities are able to maintain and grow, the emerging markets will come back – and we’ve already seen them do so in the last couple of weeks. We believe that you should have starting positions in emerging market ETFs right now, and we advise you to sharpen your pencils and allocate a small amount to this sector. Pull-backs can still happen, but it looks like the emergence of an uptrend.

In North American energy, we like energy services and alternative energy the most for investors.

In precious metals, we think that opportunities will continue to present themselves and that investors should be watching those indicators and looking at prices so that you can purchase at a good value.

For more information on these strategies, please check our special reports page.

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Video Update: Look Back at the First Quarter

It’s hard to believe that the first quarter of 2014 is behind us – but this is a great time to refocus your portfolio and balance your investments. We want to stress that it’s very important that you look into the world of Exchange Traded Funds as you invest. It’s easy to move cash, mutual funds or other brokerage accounts into ETFs, so call us today for more information: 800-391-1118.

There was a shuffling of the deck in March, and we saw China and the emerging markets come on strong. As you look at re-balancing your 401k, we think that the emerging markets are a good place to look for investment opportunities.

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