Long Terms Investors Shouldn't Fear The Fed Taper
Long-Term Investors Should Embrace Tapering (Vanguard)
On Wednesday the Fed announced that it was tapering its asset purchase program to $75 billion a month, down from $85 billion. Despite investors concerns around this move however, Andrew Patterson at Vanguard argues that this is good for investors in the long run " because it's a sign monetary policymakers view the U.S. economy as being on more solid footing." He reminds us that "tapering doesn't mean interest rate increases are imminent." Tightening isn't likely till mid-2015. But he does think "the road to normalized policy is likely to be long and volatile." In this environment, Patterson thinks investors should stay diversified and reminds us that even if bonds aren't as popular anymore, they still "offer important diversification benefits with the potential to offset equity risk."
4 Major Advisor Recruitment Trends To Expect In 2014 (Investment News)
Tom Daley, founder and CEO of online financial advisor community, The Advisor Center, writes that there are four clear recruiting trends we can expect to see in 2014. 1. Advisors are choosing to join existing firms or registered independent advisors (RIAs) and hybrid instead of investing in a solo practice. 2. Following on the trend that advisors are opting for existing opportunities, super ensembles, or large firms with $5 million or more in revenue "will continue to thrive." 3. Advisors are trying to offer advisors a transition package with more "long-term value" instead of giving them a lump sum up front. 4. Advisors are still trying to stay with their current clearing firm or custodian since it makes the transition easier.
4 Major Advisor Recruitment Trends To Expect In 2014 (Investment News)
Tom Daley, founder and CEO of online financial advisor community, The Advisor Center, writes that there are four clear recruiting trends we can expect to see in 2014. 1. Advisors are choosing to join existing firms or registered independent advisors (RIAs) and hybrid instead of investing in a solo practice. 2. Following on the trend that advisors are opting for existing opportunities, super ensembles, or large firms with $5 million or more in revenue "will continue to thrive." 3. Advisors are trying to offer advisors a transition package with more "long-term value" instead of giving them a lump sum up front. 4. Advisors are still trying to stay with their current clearing firm or custodian since it makes the transition easier.
Institutional Investors Haven't Been This Happy With Hedge Fund Performance Since Before The Financial Crisis (Prequin)
A new survey by Prequin, a research and consultancy firm focused on alternative asset classes, shows that institutional investors haven't been this happy with hedge fund performance in a while. 83% of 148 investors surveyed by Prequin said hedge funds had met or exceeded their performance expectations in 2013, compared with 60% the previous year.
Wells Fargo Is Said To Be Raising Its 2014 Bonus Cap For Advisors (Bloomberg)
Wells Fargo is raising its 2014 bonus cap for financial advisors, according to Dakin Campbell at Bloomberg News. Brokers bringing in revenue of $2.1 million can earn an 11% bonus, up from 8.5% in 2013. Those who bring in $300,000 in revenue can earn an 8.25% bonus, up from 2% in 2013. This is a part of CEO John Stumpf's strategy to raise assets under management (AUM) and retain brokers.
JACK BOGLE: This Chart Was Useful In 1929, 2000, And 2007 (Business Insider)
Vanguard's Jack Bogle thinks the Dow Jones Industrial Average's price-book ratio chart, is the most important chart of the year. Book value represents the value of a company by calculating the difference between its assets and liabilities and this can show whether the stock is overpriced or underpriced. "I like this chart because it shows when market value deviates significantly from intrinsic value. It was particularly useful in 1929, 2000, and 2007," Bogle said.
