July 6 Lowe Wealth Advisors conference call with Morris Segall
If you missed the conference call with Morris Segall and Lowe Wealth Advisors July 6th click here to listen. The call is about 35 minutes in length and discusses the economic conditions, capital markets and Lowe Wealth Advisors strategies. Note: The call is intended to be informational in nature and should not be considered advice or a recommendation for any particular strategy. Past performance is no guarantee of future results.
The equity markets as we expected have seen an early July rebound. In the financial press and news sound bites the news seems all good. Not so fast.
Lowe Wealth Advisors is hardly convinced that things are getting better. We are not buying the hype that Europe is on the mend and we certainly do not think that the decline in jobless claims is anywhere near where it needs to be for a sustainable recovery.
In our opinion, what we are seeing is the start of the “earnings rally” which we predicted in the past several editions of market notes.
While we do not believe the rally will have depth and staying power, Lowe Wealth Advisors has removed the position which can move in the opposite direction of the S&P 500 (see index disclaimer) in our discretionary actively managed accounts.
Would we then consider increasing equity positions in light of the potential short term rally? Quite simply, the answer is no. We do not attempt to time the stock market. Attempting to capitalize on extremely volatile and unpredictable markets swings on a short term basis is a game fraught with risk.
When we moved to a defensive posture in May we knew that while the assets would potentially fall less in a down market, in a rising equity market our portfolios would participate, but at a lesser level. This strategy in most allocations was successful for the first quarter and year-to-date. We believe that our focus on potential asset preservation remains the prudent strategy for the foreseeable future. As we discussed in the prior edition of this column, if we can lose less than the market and participate in reasonable gains when the market is rising, we consider this to be success.
Don’t believe that in three days everything has changed. It’s not that we are unhappy the market is going up, but the same underlying risks prevail. Over the past two months in our actively managed accounts we have gradually built the cash position. We view this cash as a tactical and transitional strategy. The cash will be used to purchase holdings as appropriate which have the potential to achieve our goals over the next 6 to 12 months.
If you have not had an opportunity to listen to the conference call from July 6 with Morris Segall we encourage you to do so by clicking here. It is a 35 min call which discusses these issues in greater detail.
Finally, we are in the process of compiling your Lowe Wealth Advisors quarterly report and newsletter. You should expect to receive this by the middle of next week.
Material discussed is meant for general illustration and/or informational purposes only and it is not to be construed as tax, legal, or investment advice. Although the information has been gathered from sources believed to be reliable, please note that individual situations can vary therefore, the information should be relied upon when coordinated with individual professional advice. Not all portfolios are actively managed. If you have a question about how your account is being managed please contact us. Generally accounts less than $150,000 are not actively managed. An Index is a portfolio of specific securities (common examples are S&P, DJIA, NASDAQ), the performance of which is often used as a benchmark in judging the relative performance of certain asset classes. Indexes are unmanaged portfolios and investors cannot invest directly in an index. Past performance is not indicative of future results.
- Not all portfolios are actively managed. If you have a question about how your account is being managed please contact us.
- No diversification can completely protect against market risk or other risk factors with investing. A diversified portfolio could still lose money.
- An Index is a portfolio of specific securities (common examples are S&P, DJIA, NASDAQ), the performance of which is often used as a benchmark in judging the relative performance of certain asset classes. Indexes are unmanaged portfolios and investors cannot invest directly in an index. Past performance is not indicative of future results.
Foreign investing carries additional risk such as currency risk, political risk and different accounting standards.
*Lowe Wealth Advisors is a registered investment advisor.