Blog

Mar 15

Ask Cadence: If the only way to earn a meaningful return on my investment is to take risk, how do I balance the different types of risk within my portfolio?

By Cadence WM Blog

The most important thing to understand when building an investment portfolio is that all investments worth considering can and most likely will lose money at some point. Unfortunately this is just how it works. The key is to make sure that the different components of a portfolio possess risks that are unique and somewhat uncorrelated. This way, we decrease the chance of any one type of risk doing significant damage to our investment nest egg. By keeping this approach in mind, we’re less likely to fall into the trap of chasing returns and building a portfolio with more loss potential than…

Feb 26

The Epic Disconnect

By Cadence WM Blog

What we’re experiencing in the financial markets right now is unique while at the same time very similar to previous bull markets. Those contending that this time is different are correct. We’ve never had synchronized global monetary easing on the scale we’ve witnessed over the last few years. This is new, and without question one of the primary drivers of this epic bull market run. The liquidity created by central banks around the world has created the desired effect – inflation. The only problem is that it hasn’t translated into price inflation to the extent desired (by central bankers) which…

Feb 09

What to Think of Interest Rates and Bonds

By Cadence WM Blog

Bubbles are dynamic and as a result, different each time. But one common theme amongst them has been the tendency for interest rates to play a role in their eventual demise. Looking back 30 years, there seems to be a causal relationship between rising rates and poor stock market performance. More times than not when the 24-month change in 10-year treasury rates spiked upward, stocks ran into trouble. Practically every sizable correction in stocks was preceded by an acute increase in interest rates. But rising rates don’t just signal possible trouble for stocks, they also mean there’s a current problem…

Jan 18

Goals Are Bigger Than Short-Term Investment Returns

By Cadence WM Blog

This current bull market started in March 2009, making it the second longest bull market in investment history. You can just glance at a chart of the S&P 500 and see that bull markets, especially big ones, do eventually come to an end. What has been unusual about this particular bull market is not only the duration going on nearly 9 years now, but also the relatively low level of volatility we’ve experienced along the way. This part of the market cycle has a sinister way of lulling people into feeling like there’s less risk in the stock market than…

Dec 19

Ask Cadence: Should I consider contributing to my employer-provided Roth 401(k)?

By Cadence WM Blog

Most employers, especially the medium and large-sized ones, provide some sort of retirement plan. A large percentage of those are traditional 401(k)s, where you contribute pre-tax dollars into the plan, you do not pay any taxes on gains inside the plan, and then every single dollar you take out of the plan in the future is fully taxable. Another well-known retirement account is the Roth IRA, which is almost the complete opposite of the 401(k). Like 401(k)s, the growth inside Roth IRAs is not taxed, but unlike 401(k)s, post-tax dollars go in, you can’t save into them right out of…

Nov 08

Eight Ways to Get Estate Inheritances Right

By Cadence WM Blog

Life is complicated, but does passing money to your beneficiaries have to be also? In theory it shouldn’t, as all you want to specify is “when I die, give this much to these people”. That sounds so simple, yet when it comes time to create a process that would allow that to happen, a lot of picky little details get in the way. Getting any of them wrong increases the chances that your estate plans could go awry. Consider these eight ways to get your estate strategy correct: 1) The More Accounts and Institutions, the More Paperwork. Every account you…

Sep 26

What The Future Holds For Stocks – It’s All About Price

By Cadence WM Blog

Let’s keep this simple. U.S. stocks by almost any measure that doesn’t obscure reported earnings are either at or very near record levels. Here’s a look at a couple valuation measures we’ve discussed in the past – the Shiller CAPE and the S&P 500/GDP. What’s immediately noticeable from both measures (shaded in blue) is that they are toward the top of their historical ranges, exceeded only by the tech bubble in 1999. What both of these charts don’t show however is what happens when we adjust for the above average corporate margins and below average economic growth that we’re observing…

Sep 14

Ask Cadence: If the markets and economy are likely to struggle over the next few years, will my retirement plan be ruined?

By Cadence WM Blog

Not necessarily. For those who don’t understand where we are in the economic cycle and the current valuation levels of markets, there will likely be some very unpleasant surprises down the road. This is nothing new. For investors who were too aggressively positioned in 1999 and 2007, most of the progress they had made over years of investing was wiped out within months. This time probably won’t be any different for unsuspecting investors. However, by taking a more conservative approach and focusing on principal preservation, there will most likely be opportunities down the road to invest at much more reasonable…

Aug 24

Are You Leaving Money on the 401(k) Table?

By Cadence WM Blog

Contributing to a 401(k) plan is good, right? Then contributing the maximum possible to a 401(k) is even better. However, there is one small mistake we see people making that can have a surprisingly big impact over time: hitting the maximum they can contribute before the final paycheck of the year. It may be best to illustrate the mechanics of this with an example. Consider someone making $125,000 per year, paid out as $5,208 gross twice per month. If that person decides to save 18% of his or her salary, he or she would contribute $938 every paycheck and would…

Have A Question?

Ask Cadence: If the only way to earn a meaningful return on my investment is to take risk, how do I balance the different types of risk within my portfolio?

The Epic Disconnect

What to Think of Interest Rates and Bonds

Goals Are Bigger Than Short-Term Investment Returns

Ask Cadence: Should I consider contributing to my employer-provided Roth 401(k)?

Eight Ways to Get Estate Inheritances Right

What The Future Holds For Stocks – It’s All About Price

Ask Cadence: If the markets and economy are likely to struggle over the next few years, will my retirement plan be ruined?

Are You Leaving Money on the 401(k) Table?

Archives

Cadence

Client Center

Connect

Follow Cadence

Sign Up For Our Newsletter