Posted: October 30, 2024 | by: Thomas F. McKeon, CFA
In this Issue: From the CIO's Desk, Review & Outlook, CSCM Model Portfolio Update, IRA to Roth Conversion, Interactive Brokers Smart Phone App, David Gray & Company performs "Babylon" and Closing Thoughts.
The U.S. Equity markets closed the third quarter at an all-time high. The Federal Reserve lowered the Fed Funds rate for the first time since 2020 during the quarter, providing a little valuation support. The markets cheered. There will (should) be a few more rate cuts through 2025-2026 as the Fed moves rates to a long-term target near 3.5%.
The graph above shows the 3Q returns for the major market indexes we build client portfolios with. The returns would be a great year for most of the asset classes. This was however just one quarter.
As always, the end of the year and early into the next year, it is a time for portfolio review, re-balancing and re-positioning. The markets—especially in the U.S. Large Cap market—have had a very good year...their best first three quarters since 1997. As such, some of your portfolio positions may have outgrown their target weights, while some may have not kept up and found their portfolio weight below target.
The graph above shows the benchmark performance for our recently re-built suite of portfolio benchmarks. As reminder, we re-built our suite of benchmarks in early 2024 because our original benchmarks had become a little less representative of what we actually do for client portfolios.
Interactive Brokers has a really good app for smart phones available for free for clients who custody their accounts with them (see image right). It offers a wide range of portfolio information including:
An idea that may be worth considering for investors with assets in a traditional IRA is a traditional to Roth IRA conversion. The aim is to have tax free income from the Roth and to avoid Required Minimum Distributions (RMD).
We have undertaken a project to refresh our website with a re-tooling of all the pages, for clarity and accuracy and a complete re-build of our home page. Current best thinking about home pages is that visitors spend very little time there and if they can’t figure out what you do in about 15 to 30 seconds or less, we have lost an opportunity to nurture a potential client.
David Gray and company performing his classic “Babylon” unplugged in 2011,
The year-long market rally through 9/30/2024 has driven client portfolios to new high water marks. Our portfolios are built to capture all of whatever the markets provide. They are doing just that.
Coming Soon...