In today’s market update video I discuss the current stock market trend, why the market may drop 2-2.5% (and you shouldn’t worry too much about it), as well as some random thoughts on the US Debt Ceiling and how it impacts financial markets.
Enjoy,
Jason Wenk
It’s not that we have a short time to live, but that we waste a lot of it. - Lucius Annaeus Seneca
Remember to enjoy this time of year, spend time with those you love dearly, and count the many blessings you do have in your life. (Jason’s words – Not Seneca’s 
)
I’ll be largely unavailable from this coming Saturday until after Christmas Day. Partly a very busy work week coming up, and also some quality time with family. Have a wonderful Holiday (no matter what type you celebrate) and I’ll be back online soon!
Cheers,
Jason Wenk
On this Veteran’s day I thought I’d share a couple great links I found on the web. We all have much to be grateful for living in a country defended selflessly by many great men and women. Thank you.
http://www.military.com/veterans-day/ways-to-give-back-to-veterans.html?comp=7000023108030&rank=1
http://www.military.com/veterans-day-2012-slideshow/
Each month I calculate the strength of the US economy using a math based model I call RPA (Recession Probability Analytics). When the number rises above 50 it means the US economy is in the bottom 50% of all economic conditions relative to it history.
While far from perfect, the model has had an uncanny ability to correlate (negatively) with stock market returns. In other words, when the model moves above 50 the S&P 500 has fallen over 25% and when it is below 50 the S&P 500 has risen nearly 15%. I began publishing the model in November of 2007.
Here’s the full history of RPA from inception:
| Month/Year | RPA | S&P 500 | S&P Return | Growth of $100,000 if exiting S&P 500 for month after RPA moves above 50 |
|---|
I’m back at this week with another annuity review. This one again was at the request of a blog reader who has yet to purchase but is contemplating the Nationwide Destination B Annuity with Lifetime Income Rider.
One of my business partners was doing some research this week and found a really interesting fact about variable annuities. In the 4th quarter of 2011 over 90% of variable annuities sold had some type of guaranteed income rider. Wow, talk about market share!
It comes as no surprise to me now why so many people ask me about various annuities with income guarantees. Given the portion of population in our country rapidly reaching their retirement years, the stock market being anything but predictable, and interest rates at record lows – it’s know wonder so many companies and advisors are marketing retirement income as their go-to specialty.
Each month I calculate the strength of the US economy using a math based model I call RPA (Recession Probability Analytics). When the number rises above 50 it means the US economy is in the bottom 50% of all economic conditions relative to it history.
While far from perfect, the model has had an uncanny ability to correlate (negatively) with stock market returns. In other words, when the model moves above 50 the S&P 500 has fallen over 25% and when it is below 50 the S&P 500 has risen over 15%. I began publishing the model in November of 2007.
Here’s the full history of RPA from inception:
| Month/Year | RPA | S&P 500 | S&P Return | Growth of $100,000 if exiting S&P 500 for month after RPA moves above 50 |
|---|
I hope this post finds all my blog readers well and having enjoyed a fantastic Christmas.
I’ve been busy the past couple weeks with client meetings and year end preparations – but will return to my usual blog updates of at least once per week soon enough. In the next week I’ll be posting my 2011 year in review as well as my forecasts for 2012. We’ll revisit some charts I’ve used throughout this past year, update the recession probability analytics (RPA), as well as the monthly Tactical Asset Allocation (TAA) feature.
As mentioned in this previous post, I’ll be starting a monthly feature on Tactical Asset Allocation (or TAA as it’s often referred to). TAA is the science of measuring relative attractiveness of various asset classes and updating an investors asset allocation accordingly. For details on the metrics used in the model I’m sharing for free on this blog, check out this post.
Based on measurements of both risk and reward, here’s the most up to date allocations for the TAA model:
| Stocks (Vanguard Total Stock Market ETF as proxy) | Bonds (Vanguard Total Bond Market ETF as proxy) | Real Estate (Vanguard REIT ETF as proxy) | Gold (SPDR Gold ETF as proxy) | |
|---|---|---|---|---|
| September 2011 | 0% | 55% | 7% | 38% |
| October 2011 | 0% | 62% | 0% | 38% |
| November 2011 | 0% | 60% | 0% | 40% |
I’ll probably do a weekly market update tomorrow – but ran across something today I had to share with my blog readers.
As a financial advisor I’m constantly being bombarded by companies trying to sell me their products/services; or trying to get me to try to sell my clients their products/services. 99% of the time I ignore the shiny objects and go about my independent, objective research.
But today I got an email that peaked my interest, though not in a good way.
The advertisement was basically a pitch to annuity salespeople on how they could double, triple, or even quadruple their annuity sales by becoming an RIA (Registered Investment Advisor). Hmm.
Welcome to the blog of Jason Wenk; author, quantitative investment systems developer, and investment advisor.
On this site I mix business, my latest research, and a little bit of my family life. The goal is to make an impact with knowledge, but also let the world know there's more to me than just my work.
