Dividends are the backbone of the Retirement Compounders. Now Michael Wursthorn reports in The Wall Street Journal that dividends are on the rise. Dividends are on the rise when investors have fewer reasons to buy the stocks that pay them out. More than a fifth of the companies in the S&P 500 have boosted their dividends to shareholders so far this year, while none have slashed their payouts, a first since 2011, according to S&P Dow Jones Indices. The increases are getting bigger too, with companies on average raising their payouts by 14%, the biggest jump since 2014. The … [Read more...]
Is There a Worldwide Shortage of LNG?
According to Royal Dutch Shell, the world could see a LNG shortage within a decade. Without more investment in new projects, heightened demand could swamp new supply. Tom DiChristopher reports at CNBC: The Anglo-Dutch energy giant issued the warning in its second annual LNG outlook, which reports on developments in the booming market for natural gas cooled to liquid form for export. Shell says the market for LNG grew by 29 million tons last year, 30 percent more than previously expected. Trading in LNG reached 293 million tons in 2017, up from just 100 million tons at the turn of the … [Read more...]
Compound Interest is Key
For prudent investors, the last three years have meant watching the so-called FAANG stocks (and other speculative shares) rise at a rate that is seemingly unbounded by profits or dividends. The FAANGs have gobbled up an ever-larger portion of the S&P 500 index total market capitalization. Four of the five largest companies in the S&P 500 are now FAANGs. Today’s market environment feels similar to the late 1990s when speculation was dominant. To successfully navigate the environment then, I advised a focus on patience and compound interest. Compound Interest Is the Key Legendary … [Read more...]
A Bet on Emerging Markets is a Bet on Asia
MSCI is revamping the rules for inclusion in the widely followed MSCI Emerging Markets index. MSCI plans to cut the weight of stocks with unequal voting rights. If implemented, the rule would increase the weight of Asian stocks in the index to over 75% while lowering the weight of Latin American stocks to about 11%. The biggest country weights in the MSCI Emerging Markets index are China, South Korea, and Taiwan. Like most market capitalization weighted indices, the MSCI Emerging Markets index is top heavy. The top five countries (out of 24) account for 73% of the weight of the index. If … [Read more...]
Don’t Put Your Greed too far Ahead of Your Fear
This morning The Wall Street Journal tells the story of Harvey Hajiyan, a financial adviser who has been making big bets in the market on margin. In speaking to the Journal, Hajiyan said a phrase that should be a warning bell to any investor "all the strategists agreed." Any time everyone is in agreement on something, you should pick your head up and take note. Someone isn't pricing in risk properly, and if you're just coasting along with the crowd, that someone is you. Use Mr. Hajiyan's tale as a reminder of what happens when investors put greed too far ahead of fear. The Journal's Michael … [Read more...]
How Not to Choose Your Investment Advisor
When financial advisors take it too far to embellish their credentials, it’s the investor who typically pays the price no matter how well-intentioned an advisor may be. In this case you have advisors giving speeches outside of Harvard and West Point with no affiliation to the institutions what so ever and taking credit as being invited guests. The huckster putting these gigs together is Clint Arthur, a former taxi driver and butter salesman who, according to columnist Jason Zweig, “trains businesspeople—including, so far, about three dozen financial advisers—in media skills.” “In order … [Read more...]
The Market for Natural Pet Food is Taking Off
General Mills has announced an agreement to acquire Blue Buffalo pet food company. Blue Buffalo makes natural pet food the company calls "super-premium pet food using only the finest natural ingredients starting with real chicken, lamb or fish." The American market for pet food has been strong, with Blue Buffalo delivering "compound annual net sales growth of 12 percent," over the last three years, according to Bloomberg's Eric Pfanner. He continues: The buzz around the pet-food sector means another suitor may emerge for Blue Buffalo, said Pablo Zuanic, an analyst at Susquehanna International … [Read more...]
Are More Online Sales Actually Hurting Walmart?
Despite every retailer attempting to boost their online presence, it turns out that profitability for online sales is lower, and dependability may be too. Walmart recently suffered a bad quarter of earnings, in large part because of mismanaged online sales. In the fourth quarter sales grew 23%, down from over 50% in each of the previous three quarters. Investors weren't happy with the slow down. Sarah Nassauer reports: That wasn’t enough for investors. “This quarter did not live up to those high expectations,” said Simeon Gutman, a retail analyst for Morgan Stanley. Still, Mr. McMillon on … [Read more...]
Are You a Baby Boomer with a Retirement Income Problem?
Originally posted October 23, 2017. You need income in retirement. It’s that simple. But to many, retirement income, and the lack thereof, is a problem that will never be solved. Over the weekend I read an article in the local paper about how dreadfully ill-prepared the Baby Boomer generation is when it comes to retirement income. And it’s a subject that comes up quite often in my conversations with prospective clients. They ask me, “How will I get income from my investments?” After I explain how we construct portfolios, I tell them that a good rule of thumb is to draw no more than … [Read more...]
Take a Drive with Us to Cannon Mtn. in the Live Free or Die State
Over the President’s Day weekend we hit the slopes of New Hampshire skiing Attitash, Wildcat, Sunday River, and Cannon. In this video, drive with us from Bartlett, where we have a log cabin, through the White Mountain National Forest to ski Cannon Mountain. It was a typical New England weekend with rain, sleet, snow, and wind, and yet you’d never know it in this video. Check it out. Click here to watch the video on Yoursurvivalguy.com. … [Read more...]
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