DJIA 15948.02 SP500 1834.72 “Quick Investment Thoughts”
I am trying to protect our portfolio vulnerability as best as possible. Market corrections are normal. I think the companies our clients own are generally financially stable and should typically have no survivability issues. I have been buying in this downfall for clients that have cash, new monies etc. Don’t forget the 10 year treasury is now yielding 2.00%. It hit an intraday low today of 1.868%.
As I have mentioned in the past, we are only long term oriented. Our thesis is based on the assumption that for the majority of the companies we own that their dividends are sustainable and that they are still fairly priced. Markets will fluctuate, and corrections will occur. As you know we do not believe in timing of investments. Utilities have gone up much quicker than I expected, and this increase has increased the risk of declines. Yet, most of our utilities are intended to be long term investments, and as a whole they do not appear to be terribly overvalued.
As our clients should realize, we are not at all focused on, nor could us or anyone else control short term results. There will be many periods of portfolios losing money. Corrections, recessions and depressions will occur. It is my opinion that no one can competently time markets.
Our clients are typically heavily weighted in utilities and hence our risk levels should typically be materially less than the S&P 500. We will often trail the S&P 500 on the upside, as well as typically lose less than the S&P on the downside.
The expected dividend yield of our typical portfolio is 2.5%. This yield is 125% of the 10 year Treasury, which is currently 2.0%.
We have a large allocation to various utilities in typical portfolios of around 25% +/-. We are using utilities as an alternative to investing in fixed income. As we have mentioned in the past, I am concerned with what I consider still low interest rates. We are still not investing in any fixed income in our portfolios. Of course one can’t compare utilities to the safety of quality fixed income.
We are always mindful of our allocations, and if we think specific investments should be reduced we will do such. I do not currently anticipate any major changes.
If a client is concerned of their portfolios, they should contact us, as the last thing one would want to do is sell based on emotions in a sell off. Many clients were with us during the crash of 2008, and all worked out just fine for those who stayed the course. None of our clients were damaged with us during the crash of 2000. Yet, past performance is not necessarily indicative of future results.
We are having an investment conference on November 13th at the Westwood. The conference will include dinner, drinks, a discussion by me about what we are thinking about when investing and maintaining portfolios, and will end with a hopefully lengthy question and answer session. You will get invitation and you should go for sure, and ask questions like this.
https://www.rbcpa.com/wp-content/uploads/2016/12/RBS_2014_Investment_Conference.pdf
If you have any concerns, please reach out to me. I would be happy to speak with those who are not clients or ours as well. As always, we welcome the opportunity to discuss our outlook and investments with you.
Please feel free to contact me with anything you would like to discuss. Feel free to ask general questions on our Facebook page as well.
You could also follow me on twitter http://www.twitter.com/rbco
Respectfully submitted,
Ron Redfield
Ronald R. Redfield cpa, pfs
Redfield, Blonsky & Starinsky, LLC
1024 South Avenue W.
PO Box 2069
Westfield, NJ 07091-2069
https://www.facebook.com/RedfieldBlonsky
908 276 7226 phone
908 264 7972 fax
Disclaimer
If you are a client of ours, and if you have questions regarding the company or investment mentioned in this report please call our office. If you are not a client of Redfield, Blonsky & Co. LLC Investment Management Division and are reading these notes, we urge you to do your own research. We will not be responsible for any person making an investment decision based on these notes. These notes are a “by-product” of our research. We are not responsible for the accuracy of these notes. We are not responsible for errors that may occur in these notes. Please do not rely on us to monitor or update this or any other report we may issue. In theory, we could come across some type of data or idea, which causes us to eliminate our long or short position of the company or investment mentioned in this report from our portfolios. We will not notify reader’s revisions to these notes. We are not responsible to keep readers of these notes updated for changes or material errors or for any reason whatsoever. We manage portfolios for clients, and those clients are our greatest concern as it relates to investing. Certain clients of Redfield, Blonsky & Co LLC may not have the company or investment mentioned in this report in their portfolios. There could be various reasons for this. Again, if you would like to discuss the company or investment mentioned in this report , please contact Ronald R. Redfield, CPA, PFS (partner in charge of investment management division).
Information herein is believed to be reliable, but its accuracy and completeness cannot be guaranteed. Opinions, estimates, and projections constitute our judgment and are subject to change without notice. This publication is provided to you for information
Important Disclosures
1. Redfield, Blonsky & Co., LLC (RBCo), only transacts business in states where it is properly registered, or excluded or exempted from registration requirements.
2. Past performance assumes reinvestment of dividends and other distributions and may not be indicative of future results. Therefore, no current or prospective client should assume that the future performance of any specific investment, investment strategy (including the investments and/or investment strategies recommended and/or purchased by adviser), or product made reference to directly or indirectly in this presentation or on our website, or indirectly via a link to any third-party website, will be profitable or equal to corresponding indicated performance levels. The investment return and principal value of an investment will fluctuate and, when redeemed, may be worth more or less than their original cost.
3. Different types of investments involve varying degrees of risk, and there can be no assurance that any specific investment will either be suitable or profitable for a client’s investment portfolio. No client or prospective client should assume that information presented is a substitute for personalized individual advice from the adviser or any other investment professional.
4. Historical performance results for investment indexes, such as the S&P 500, generally do not reflect the deduction of transaction and/or custodial charges or the deduction of an investment-management fee, the incurrence of which would have the effect of decreasing historical performance results of the S&P 500 Index. Whenever RBCO performance is referred to, results have been reduced by all fees, including RBCO management fee.
5. Returns for the RBCO portfolios have been calculated using actual time-weighted returns obtained from all accounts over the time periods indicated. All RBCO returns assume the reinvestment of dividends and are shown net of the investment management fees and all other expenses. Please see our form ADV for a full fee disclosure. Actual individual account performance may be materially different from our composite results.
6. RBCO files an annual form ADV, which includes an easy to read brochure. Form ADV is a valuable read for anyone interested in learning more about RBCO. Additional information about Redfield, Blonsky & Co., LLC is also available on the SEC’s website at http://www.adviserinfo.sec.gov . The searchable IARD/CRD number for Redfield, Blonsky & Co., LLC is 128714.
7. The S&P 500 Index is a widely recognized, unmanaged index of 500 of the largest companies in the United States as measured by market capitalization. The S&P 500 Index performance assumes reinvestment of all dividends and distributions and does not reflect any charges for investment management fees or transaction expenses, nor does the Index reflect any effects of taxes, fees or other types of charges and expenses. The S&P 500 Index is one of many indices and is not necessarily the most appropriate index when comparing performance results.