In the years 2010-2012, investors around the world poured nearly $700 billion into bond funds, while taking nearly $300 billion out of stock funds. That was then, this is now. Today, more investors view the bond market as abnormally risky and are concerned that recent bond losses could deepen if interest rates continue to rise. ZIRP (zero interest rate policy) has come at the expense of savers and conservative investors, among them are retirees and captive insurance companies. Without an ability to find a risk-free return, much less a low-risk return, many investors have moved and continue to move into riskier assets in order to generate some returns.
Asset Protection 101: When Buy and Hold Fails
Welcome to our Asset Protection 101 series. With exception to diversification, the industry doesn't like to talk about asset protection because it goes against conventional thinking and the way that most advisors operate. However, one size doesn't fit all clients so we will take on these topics in this series.
Buy and hold refers to an investment strategy in which investors hold on to their stocks for a long period of time regardless of fluctuations in the market. One of the main benefits of a buy and hold strategy is the easiness of the process. It is no surprise that Wall Street pushed this message as they no longer had to make the tough decision to actually protect client assets before a bear market. Lucky for them, the market had a huge secular bull market from the mid-1970's to 2000 as interest rates declined from the mid-teens to single digits and the stock market had an epic run in the 90's culminating in the Internet bubble.
Asset Protection 101: Is the Bear (Market) Coming Out of Hibernation?
Welcome to our Asset Protection 101 series. With exception to diversification, the industry doesn't like to talk about asset protection because it goes against conventional thinking and the way that most advisors operate. However, one size doesn't fit all clients so we will take on these topics in this series.
With the market now 4.5 years into its bull run, investors must ask themselves, “How much longer can the party last?”