Research & Analysis



After the worst start for the moderate portfolio in over 90 years the article below reminds  investors that time in the market is more important than timing the market and that longer holding periods reduce risk.

The Worst Years Ever For a 60/40 Portfolio


 I don't want to be a Debbie Downer here, but I think under the hood, the labor market data is actually a little bit weaker, and the leading indicators suggest a weakening from here. The silver lining, however, is that the sooner a recession happens, the sooner it's over. And from a stock market perspective, we have discounted, I think, already probably a mild recession. We may still have to go through the rerating process in terms of corporate earnings, but a lot of that negative economic news that I think is just coming to fruition, and we're starting to stack up the dominoes that suggests this is more likely a recession, but the sooner we're in it, the sooner we get out of it. And I think that, to some degree, is what the market has reflected. So probably bumper your news from here, but I actually think getting a recession sooner is more of a positive story for the remainder of 2022 than if we push that off until later this year.


The potential benefits of tax harvesting may be even better for investors in municipal bonds. By applying tax loss harvesting to a municipal bond portfolio, investors don't simply defer capital gains tax liabilities. The goal is to eliminate capital gains taxes completely.


All major Morningstar fixed-income fund categories fell in 2022's first quarter as interest rates soared. The Federal Reserve officially raised short-term interest rates by 25 basis points in March for the first time since December 2018, after hinting it would do so for several months. The Bloomberg Aggregate Bond Index, a proxy for the U.S. bond market, fell 6.1%--its worst quarter in almost 40 years--while the average intermediate core bond Morningstar Category fund lost slightly less: 5.9%.


After the worst bond market rout in decades Vanguard reminds us why it is not time to bail on bonds.


As the 2 and 10 Year Treasury spreads close in on inversion Schwab's Chief Investment Stratagist Liz Ann Sonders gives some additional context to this reliable predictor of recessions.


After a long period of outperformance in Growth vs Value and Domestic vs International/Emerging Markets Morningstar reminds us why it is important to rebalance to reduce portfolio risk.





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