Submitted by Vantage Financial Partners Limited on October 23rd, 2017
by Jon Flaherty
How often have you become caught up in the “keep up” game we so often play and illustrated so perfectly by the Jones family? With so many places to spend money, whether it be the newest car, latest technology or that bigger house we’ve always wanted, it becomes far too easy to stay in constant “upgrade” mode.
The behavioral aspect of finance and its potential impact on investors reaching their financial goals is an important topic to be aware of. I’d like to spend another minute to discuss additional biases from the two categories (Cognitive and Behavioral) I introduced in my last post.
Submitted by Vantage Financial Partners Limited on September 25th, 2017
by Thomas Rueger, JD
Nothing about an emergency sounds good. We don’t want to hear about them, we don’t want to think about them, and we certainly don’t want them to happen to us. But, if we’re honest with ourselves, we all know that we should be prepared for them. Even worse sometimes than the emergency can be the resulting consequences, especially the financial toll it can take if the proper precautions were not taken.
U.S. Equity indices resumed their march higher, erasing the prior month’s brief decline. International equities joined the party but were outpaced by their U.S. counterparts. Emerging Markets continue to impress with strong returns. Various risks spilled over into the fixed income sector causing a short-lived flight to safety. Investors pushed yields lower as they reacted to headline risk involving North Korea on one side of the globe and a series of hurricanes on the other. The move in yields quickly reversed as tensions eased for a while.
Behavioral finance introduces the idea of biases investors exhibit and how they can affect decision making. In the previous post I discussed loss-aversion, an emotional bias whereby investors feel the pain of losses more than the pleasure of gains. We identified how this could lead to irrational decisions to avoid taking a loss.
U.S. Equity indices declined over the past month as negative headlines continued to fuel uncertainty in the U.S. markets. Events related to healthcare legislation, geopolitical tensions on the Korean peninsula, and doubts surrounding President Trump’s agenda all contributed to the decline in U.S. equities over the past month. Smaller company stocks were hit harder than the larger companies - more on that below.
Submitted by Vantage Financial Partners Limited on August 24th, 2017
by Jonathan Alton
A reverse mortgage is a home-secured loan on the primary residence for homeowners over the age of 62, also known as a Home Equity Conversion Mortgage (HECM). It allows borrowers to loan against some of the equity in their home for future funds or a line of credit. There are several options to choose from that differ on interest rate, how much money is available, and payment options.
Submitted by Vantage Financial Partners Limited on July 27th, 2017
As a Financial Planning Analyst, I try to practice what I preach. This includes updating my estate plan on a regular basis due to a life change or changes to state law. I am currently in the process of updating my Estate Plan for the third time. I was somewhat surprised to see a paragraph covering Digital Assets within my Power of Attorney for Property document. Most people have heard about allowing their attorney-in-fact or “agent” handle real estate, banking, and investment transactions, but not handling digital assets.
U.S. Equity indices hit new highs this past month as stocks moved on the back of Q2 earnings. International equities, however, led the way easily outpacing their U.S. counterparts. Emerging Markets were especially strong, helped by a weakening dollar. Fixed income was mixed, with higher yielding and below investment-grade issues outperforming their more conservative counter-parts.
Traditional finance is built on the premise that investors are rational and will make optimal decisions regarding investments. It relies heavily on financial market theories and the relationship between risk and return. Behavioral finance, on the other hand, acknowledges that people are the ones interacting in the financial markets and may not always act rationally or make optimal decisions. Behavioral finance introduces the idea of biases that investors exhibit and how they can affect decision making. I find this topic very interesting and wanted to introduce it by highlighting one of these behavioral biases. I plan on discussing others in future market minute posts.
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by Jon Flaherty
by Scott Rosenquist, CFA
by Thomas Rueger, JD
by Dan Zalipski, CFA & Scott Rosenquist, CFA
by Scott Rosenquist, CFA
by Jonathan Alton
