Investors have until April 15, 2021 to make contributions to their Roth and traditional IRA accounts under the maximum allowances for tax year 2020. Tax-advantaged retirement accounts are one of the best ways to save and invest money, due to the fact that taxes can detract significantly from investment gains with short-term and long-term capital gains tax, dividend tax, and interest tax. This benefit is meaningfully amplified over time due to…
The share prices of several companies, including GameStop and AMC, recently appreciated rapidly to levels that are seemingly disconnected from the companies’ intrinsic value as estimated by most traditional stock valuation metrics. These price increases were driven largely by two factors: social media conversations and…
The geographic optionality stemming from corporate work-from-home policies has hastened an economic and lifestyle trend that has seen many individuals and families moving from states with high taxes and high costs of living to less expensive states. Many professionals have gained the flexibility to work from anywhere with…
Inflation has a significant impact on financial planning because it can meaningfully lower the value of a future investment portfolio. In fact, inflation is one of several reasons that holding excess cash can be disadvantageous; in modern times, cash has overwhelmingly lost value in terms of purchasing power. In order to simply…
As we approach the end of 2020, investors have the opportunity to assess their objectives, risk tolerance, and investment strategy going into the new year. Financial goals often evolve over time, as families grow, careers progress, and preferences change. The end of the year is…
This week Tesla was added to the S&P 500 Index, which serves as a widely used benchmark for passive investing and as a simplified proxy the performance of the broader U.S. stock market. Tesla’s nascent inclusion in the index is a reminder to investors to be aware of…
While it may be tempting for investors to attempt to identify the “best” companies and to create a concentrated portfolio with those stocks, even the most stalwart and profitable companies can carry significant idiosyncratic risk. Changing consumer trends and ill-timed capital expenditure decisions, for example…
As negotiations regarding Brexit terms between the United Kingdom and the European Union continue to evolve, the probabilistic implications for investors are also evolving. Foreign developed markets rightfully account for a meaningful portion of most well-diversified investment portfolios, and the terms of the final Brexit deal…
Many investors depend on interest and dividend cash flow from a tailored income portfolio as they transition into retirement. A diversified allocation of bonds and high-yield stocks, in addition to a selection of growth-focused equities to keep pace with inflation, can provide the consistent cash flows necessary to transfer from a steady paycheck to a sustainable high quality of life in retirement. A portfolio income strategy, however…
As pharmaceutical companies including AstraZeneca, Pfizer, Moderna, and BioNTech make strides toward developing and producing viable vaccines to provide immunization against the Covid-19 virus, it’s worthwhile from an investment perspective to assess which countries and economic sectors may…
Retirement plan tax shelters provide investors with one of the most advantageous opportunities to build wealth by protecting capital gains, dividends, and interest from taxes and amplifying the powerful force of compound growth. To adjust for inflation, the IRS has updated several…
International stocks comprise a meaningful portion of most appropriately allocated diversified investment portfolios, which serves to mitigate idiosyncratic geographic risk. For countries that engage in extensive trade with the United States, such as China, tariff policies can…
As all investors know, election results have an impact on markets, whether by maintaining the status quo, providing a mandate for massive change, or something between the two extremes. The precise impact can often be difficult to determine. For instance…
In the current environment of ultra-low interest rates, which are often negative real rates after accounting for the impact of inflation, income-seeking investors are often faced with a decision regarding whether to accept increased volatility and risk in order to pursue higher yields. These yields can…
The Federal Reserve is exploring the possibility of issuing digital currency backed by the central bank (CBDC) at some point in the future, which may have significant implications for cross-border international monetary transactions and other areas of the economy. As noted in this article…
Earnings season is kicking off, with several major banks reporting their quarterly results this week. These results can often serve as a barometer for the greater economy at-large, given that many sectors and industries interact with banks as they secure financing, issue debt and equity to investors…
While observing domestic and global economic activity trends, an investor would be well-served to keep in mind their specific investment time horizon. Particularly in the case of assessing an economic recovery, precise timing is important for investors with a short time horizon because discrepancies between short-term economic indicator expectations and results can cause significant volatility in equity and debt markets. Investors with a longer time horizon, however, can take advantage of the fact that…
Dividends can provide essential tax-advantaged cash flows to investors’ portfolios for the purpose of opportunistic tactical reinvestment and periodic income distributions. Banks are currently priced at relatively low levels and, as a result, boast relatively high dividend yields. The low stock prices aren’t necessarily…
Watching economic indicators can be an advantageous approach to identifying opportunities to introduce tactical tilts to a portfolio as market conditions change. The volume of durable-goods orders, an important…
Holding excessive amounts of cash is an expensive position to take, thanks to the concept of opportunity cost. From a probabilistic standpoint, for the privilege of holding excess cash an investor is paying the difference between the interest rate on cash and the expected return from other investment…
