Talk Back

 A financial adviser in Colorado responds to Harper Willis’s “PRACTICE MANAGEMENT: Adviser Helps Client Survive a Pink Slip”:

In this scenario I would have advised the client to leave her money in the 401(k) because at age 55 she could have taken money out of the 401(k) without any tax penalty and without having to start SEPPs.

In addition this would have given her some time to test the job market waters and see what might develop.

In the meantime she could have lived off some of the $800,000 she had set aside in savings. Continue reading…

These are the personal views of Sharon Snow, chief executive officer of Metropolitan Capital Strategies, an SEC-registered investment adviser in Manassas, Va.:

Metropolitan Capital Strategies believes there will be a positive market in 2011 primarily due to the increase in earnings of the S&P 500. Some experts are expecting operating earnings at $96/share for 2011 (Citigroup Global Markets, “US Portfolio Strategist,” Jan. 6) compared with $85 in 2010 and $62 in 2009.

This increase in earnings is a result of cuts in employees, brick-and-mortar stores and other expenses for the companies that make up the index, but regardless, revenue and earnings are two of the top fundamentals for a bounce in the equity markets.

The market will recover due to the increase in earnings and revenue, though revenue of individual companies may still be off a lower number. Some uncertainty has been cleared up for the time being, including the midterm elections and change in power, the continuation of quantitative easing with QE2 and talk of QE3, the federal government’s continuation of permanent open market operations and no change in the mark-to-market rules for the banks. This expansionary policy should assist the U.S. recovery.

The underlying “true” U.S. economy may remain weak, with the GDP projections for 2011 of 2.5%. U.S. employment and underemployment will remain weak but the stock market is forecasted to increase, with experts predicting between 1325 and 1400 for an end of the year number on the S&P 500.

Every investor should have a strategy that employs two things: the ability to make money or generate alpha, and the ability to keep that money or protect those profits once they are realized. Most investment strategies only focus on the making money side. A good New Year’s resolution for all investors would be to incorporate both into their strategy.

Looking ahead, Metropolitan Capital Strategies believes opportunities for double-digit returns with the corresponding high confidence will be found in 2011 in the broad-based U.S. stock market as well as in several sector ETFs. It could also occur in the global emerging market and some select countries. In the next five years, we could also see opportunities in commodities, bond ETFs, possibly inverse ETFs and the currency market.

An investor should always employ capital appreciation and loss avoidance or risk management in his or her portfolio.

Every asset class has risk at some point in time, even money markets and Treasurys, which are both assumed to be low risk but have lost money. It is important to keep a balance of short- and long-term goals for your money and use patience and discipline.

All market cycles go up and down, and investors should prepare for and expect that.

   By Shelly Banjo
   A DOW JONES NEWSWIRES COLUMN

NEW YORK (Dow Jones)–Results-minded philanthropists are increasingly turning to their financial advisers for help choosing the highest performing nonprofits to direct their donations.

With many advisers already giving advice on investments, estate planning, taxes and even where to purchase a car, providing expertise in a client’s particular area of charitable interest can be challenge.

To help advisers answer these questions for their clients, organizations and research firms are rolling out services such as philanthropic portfolio analysis, social impact measurement reports and information exchange networks to help advisers drive investors to charities that have garnered proven results. Continue reading…

When Charles Satterfield joined Stanford Financial Group in 2005 as managing director of fixed income, he had no idea this meant peddling Certificates of Deposit.

“They wanted to tie my compensation directly to sales of the bank CD,” said Satterfield, a fixed-income investment strategist.

“When grandma came in and wanted stability and a little bit of income, my answer was supposed to be, “Oh, the bank CD.” “When a young guy came in and wanted to grow his principal, my answer was supposed to be, “Oh, the bank CD.” “No matter what the question was, I was supposed to answer, “the bank CD.’” Continue reading…

These are the personal views of Jeff Geygan, president of Milwaukee Private Wealth Management Inc., an SEC-registered investment advisory firm in Milwaukee:

After 23 years of providing investment advice to individual investors, I regret to report the only constant trend I’ve witnessed is the perverse human characteristic of buying at the peak and selling at the trough.

It seems the average investor becomes increasingly interested in owning stocks as the broad market indices approach new high levels. Conversely, as the investment environment becomes less certain–witness the recent market bottom in March of 2009–investors flee like rats from a sinking ship.

Continue reading…

These are the personal views of Jeff Geygan, president of Milwaukee Private Wealth Management Inc., an SEC-registered investment advisory firm in Milwaukee:

I met recently with Mike, a gentleman who had been referred to my firm. He is a 55-year-old business owner who is very well-informed about his industry and with current geopolitical events.

We had developed a pleasant working rapport over several months as I came to understand his investment objectives and concerns.

Mike had three separate accounts: a joint account with his wife, a simplified employee pension account for his business and an IRA. All three accounts were held by a nationally recognized brokerage firm, which employed his adviser.

Continue reading…

These are the personal views of Jeff Geygan, president of Milwaukee Private Wealth Management, Inc., an SEC-registered investment advisory firm in Milwaukee:

A longtime client phoned recently and asked me about a solicitation he received from a local financial planner. The client is the 61 year-old owner of a successful small business, financially sophisticated and has had years of business experience. For these reasons, I was somewhat surprised by his question.

He had been offered a 6% guaranteed investment for one year. He felt this might be a good alternative for some of the excess cash and CDs he had on deposit at his local bank. Further, he was told the earnings were tax free.

Something smelled fishy. Continue reading…