REUTERS/Joe Skipper
Healthcare Leads Social Issues The Wealthy Would Invest In (US Trust)
When it comes to social issues that high net worth individuals want to invest in, healthcare takes the lead, according to the U.S Trust 2014 Insights on Wealth and Worth report. Environmental protection and disease prevention rounded off the top three most important values when it comes to investing.
US Trust
Volatility Is The One Cheap Asset Class Left Out There (BlackRock Blog)
The Federal Reserve's accommodative monetary policy has helped make nearly every asset class look expensive, writes Russ Koesterich at BlackRock Blog. "However, there is one asset class that still looks cheap: volatility."
"BlackRock and other market watchers have increasingly taken the view in recent years that volatility is an asset class, accessible through funds that track volatility indices and other strategies, that can potentially help reduce portfolio risk and increase returns).
"…The bottom line for investors is that in a world of few bargains, volatility does appear to be the one relatively cheap asset classes. And while a continuation of zero interest rates and cash-flush companies will most likely keep volatility below its long-term average for the foreseeable future, it will take a lot of good luck to keep volatility as low as it currently is. This suggests that investors looking to potentially help protect portfolio performance if market volatility suddenly rises in the case of an unexpected correction may want to consider buying volatility."
The Pessimism About China Has Created Some Great Bargains (Morningstar)
Justin Leverenz, portfolio manager of Oppenheimer Developing Markets, told Morningstar that he's seeing some of the best emerging market bargains in China. "What we've seen, of course, is that China has been this unbelievable growth story for the last decade, but equities have been probably the worst major bourse in the world," Leverenz said. "And selectively, we're now starting to see some opportunities emerge alongside this because the pessimism is far too great, and there are some really extraordinary companies, which is really what we're focused on."
"The second issue in terms of China is opportunities for extraordinary global businesses that have a large part of their franchise in China. …Actually there are more recent concerns about anti-austerity measures which have taken away part of the gifting market in that segment. But these are incredibly durable businesses with relatively low penetration. And I think one of the great themes in the world is not the emerging-markets middle class, but the Chinese middle class, and part of that's associated with tourism and increased leisure and spending."
Morgan Stanley Advisors Will Soon Be Allowed To Tweet (The Wall Street Journal)
Over 16,000 financial advisors at Morgan Stanley will soon be free to tweet, reports Corrie Driebusch at the Wall Street Journal. Until now only 1,300 advisors were approved to use Twitter. Advisors now need to attend an online training course and have over 15 followers to be able to tweet, but they still need to have their tweets approved by the firm. "That likely will keep advisers out of the quick-moving conversations that often take place on the social media platform," writes Driebusch. Regulatory requirements have made it tricky for firms to grow the social media presence.
Treasury And IRS Allow Longevity Annuities In 401(k) And IRA Markets (Treasury Department)
The U.S. Department of Treasury and the Internal Revenue Service announced regulations that make it possible for longevity annuities to be added to 401(k) and IRA markets. "A longevity annuity is an income stream - a type of 'deferred income annuity' - that begins at an advanced age and continues throughout the individual's life. This can provide a cost-effective solution for retirees willing to use part of their savings to protect against outliving the rest of their assets, and can also help them avoid overcompensating by unnecessarily limiting their spending in retirement."
"All Americans deserve security in their later years and need effective tools to make the most of their hard-earned savings," J. Mark Iwry, senior advisor to the Secretary of the Treasury and Deputy Assistant Secretary for Retirement and Health Policy said in a press release. "As boomers approach retirement and life expectancies increase, longevity income annuities can be an important option to help Americans plan for retirement and ensure they have a regular stream of income for as long as they live."