The Cumberland Advisors Week in Review is a recap of news, commentary, and opinion from our team. These are not revised assessments, and circumstances may have changed in the market from the time of original publication. We also include older commentaries that our editors have determined may be of interest to our audience. Your feedback is always welcome.
MATT MCALEER'S WEEKLY RECAP
This week we talk about:
-Nice week for Equities & Fixed Income
-Nice rise in Yields for Fixed Income
-We're picking up Munis at a 20% premium to Taxable Treasuries
-We've been disappointed in the action of small caps for the last couple of years
-Let's talk about our short, medium, and long-term strategies and "buckets"
-Leo Chen's Quantitative Research Whitepaper is almost finished, did you ask for it? See Leo talk about it here
-Please keep the comments and questions coming.
-Email us at [email protected] or give us a call at (800) 257-7013
Have a great weekend, send us your questions and comments, and thank you for joining us!
Watch below or at this link: https://youtu.be/V-ZeFc-LbTo
Matt enjoys your feedback. You can reach him at:
-Link to Matt's Email: [email protected]
-Link to Matt's Twitter: https://twitter.com/MattMcAleer4
-Link to Matt's LinkedIn: https://www.linkedin.com/in/matthew-mcaleer-9415b16/
Catch up on Market Commentaries from this week here:
https://www.cumber.com/category/market-commentary/
We invite you to visit our YouTube channel and explore the "Camp Kotok" video playlist. This playlist is comprised of Camp Kotok interviews with guests and "campers" who participate and enjoy sharing with us. We also include panel talks, scenes from the location in Maine, and other snippets we find interesting. Enjoy! #CampKotok
Patty Healy is pictured here holding the Sarasota Herald Tribune Business Weekly. She contributed to an article, "Recession fears growing", in the Monday September 2nd edition. Patty’s comments focused on:
- The importance of rainy day funds
- Recession memories die hard and most area municipalities and the state of Florida have ample reserves.
- Possible reasons a recession could occur
- The growing federal deficit
- Importance of strong reserves at the local level
- Florida has seen good growth in population and businesses- expanding the tax base, but the state does have affordability issues and exposure to climate risks, and tourism.
Cumberland Advisors appears regularly in the Sarasota Herald Tribune Business Weekly
Recession fears growing
Mousseau: The bond conundrum and how to manage
The past couple of weeks have been breathtaking for bond investors and observers of the bond market. The yield on the 30-year Treasury bond is now at a record low – it dipped under 2% this week – and the 10-year Treasury is....
Eisenbeis: To pass or not to pass?
Read more "Business News" about Cumberland Advisors and others at the Herald Tribune's website: https://www.heraldtribune.com/business/weekly
Strategists on whether Brexit should scare you from investing in UK assets
Excerpt:
The prospect of a so-called “hard Brexit” and U.K. Prime Minister Boris Johnson’s machinations to exit the European Union have promptly sent British assets into a tailspin. The prime minister is seeking a snap general election as parliament voted Tuesday to block his Brexit strategy.
U.S.-based investors continue to find the whole affair head-spinning.
“This is a mess. You can't forecast the outcome of a mess,” said David Kotok, chairman and chief investment officer at Cumberland Advisors. “You can use chaos theory; it's fancy math. At the end of the day, it doesn't tell you what to do next Tuesday.”
On Wednesday the British pound rose on politicians voting to seize control to block no-deal Brexit, one day after it touched its lowest since 1985 before rebounding. The U.K.’s benchmark FTSE 100 Index (^FTSE) has risen 15% since the vote to exit the European Union on June 23, 2016, but that compares with a 38% gain in the S&P 500 (^GSPC) in the same period. Meanwhile, the FTSE yields 5% in contrast with 2% for the S&P 500.
Read the full article or watch the video interview at Yahoo Finance, linked here: https://finance.yahoo.com/news/should-brexit-scare-you-from-investing-in-uk-assets-two-investors-weigh-in-123634745.html
Read more "News" about Cumberland Advisors at our website: https://www.cumber.com/news/
Cumberland Advisors Market Commentary – The Rise of Separately Managed Accounts – 2019 Update
Excerpt:
Cumberland has utilized separately managed accounts (SMAs) to execute its fixed-income strategy since its inception in 1973, long before SMAs were popularized in the early 2000s.
The reasons for managing money in this fashion are the same today as they were then:
-Transparency (you know what you own)
-Flexibility to make strategic changes
-Ability to manage transaction costs and best execution
-Active management
-Individually catered management of clients’ objectives, including tax management, income production, state-specific needs, cash flow-specific needs, and ability to institute investment restrictions
What exactly is an SMA? Per Investopedia: “A[n] SMA is a portfolio of assets managed by a professional investment firm. In the United States, the vast majority of such firms are called registered investment advisors, and operate under the regulatory auspices of the Investment Advisors Act of 1940 and the purview of the US Securities and Exchange Commission (SEC). One or more portfolio managers are responsible for day-to-day investment decisions, supported by a team of analysts, operations and administrative staff. SMAs differ from pooled vehicles like mutual funds in that each portfolio is unique to a single account (hence the name). In other words, if you set up a separate account with Money Manager X, then Manager X has the discretion to make decisions for this account that may be different from decisions made for other accounts.”
Many of the elements of this update are the same as last year’s, because the benefits of SMAs remain; however, the markets, technology, and regulation are always changing, which can affect supply, cost of execution, and relationships to other markets. New areas discussed this year are the growth of Registered Investment Advisors (RIAs) and new disclosure platforms for municipal issuers and investors.
At Cumberland we have a top-down approach to investment management. We look at global macroeconomic conditions and policies to assess interest rates and growth prospects and position our portfolios accordingly. Continued...
Read the rest at Cumberland Advisors' website: https://www.cumber.com/cumberland-advisors-market-commentary-the-rise-of-separately-managed-accounts-2019-update/
In Case You Missed It: Central Banks and Politics by David Kotok, Sept 23, 2013
We thank many readers for their emails, rebuttals, affirmations, and confirmations regarding our discussion of the Fed’s decision not to taper and our view that it injected another level of politics into central bank decision making. Some readers said no; they thought that the dysfunctional Congress was already churning the markets and that the Fed’s course of action, or its lack of action, had nothing to do with market volatility following Ben Bernanke’s announcement and ensuing comments by other members of the Fed. Others observed that volatile markets shifted from positive surprise at the news of no taper to negative discourse after some Fed speakers began to imply that the meeting decision was a very close call and could be reversed quickly. Still others blame the markets’ volatility and Friday’s sell-off on Speaker Boehner’s press conference alone. And others faulted the 40 or so Republican Congressmen who are hell-bent on defunding and overturning ObamaCare regardless of what their crusade might do to the US economy.
Of course these things are difficult to measure. Continued...
Read the rest here: https://www.cumber.com/central-banks-and-politics/
Are you concerned about the Trade War with China?
Lessons from Thucydides by David R. Kotok
David R. Kotok has written the monograph pamphlet, “Lessons from Thucydides” detailing information asymmetries and their implications for investors and world affairs. The concept of a Thucydides Trap and its rise and avoidability (or lack thereof) is often debated and David makes a case for dealing with them weaving current and historical events into a comprehensive narrative.
This free monograph also has lessons for President Donald Trump’s trade policy. Can the United States avoid a Thucydides Trap with China & Xi Jinping?
Download a copy of this monograph in either PDF (free) or Kindle ($.99) format.
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Cumberland Advisors Market Commentaries offer insights and analysis on upcoming, important economic issues that potentially impact global financial markets. Our team shares their thinking on global economic developments, market news and other factors that often influence investment opportunities and strategies.
