Second Half of 2021
Through the first three quarters of the year the domestic equity markets have continued their upward movement, although September has been the first down month of the year. September and October can be some of the weakest months historically. After a strong year thus far we would expect the recent choppiness to continue over the coming weeks and possibly months but also believe we are firmly in a long term bull market with years left to the upside.
We continue to favor a broadly diversified portfolio of both value and growth equities in the US and international as well. Fixed income continues to provide very little income to risk adverse investors and we expect that to continue in the short term as well. Over the longer term, however, we do expect interest rates to rise and inflation to remain higher than we’ve seen in quite some time. We also believe covered call options for equity investors, preferred stocks, convertibles and alternative investments can play a role for investors seeking higher yields. These investments have a broad range of risks so our annual strategy meetings, along with GPM retirement planning, have been excellent for determining if some of the strategies fit for clients.
Finally, we have provided long term care solutions for several of our clients in the third quarter. There are several new policy types that offer unique benefits for LTC needs while also offering different premium options that traditional LTC, which is more of a “use it or lose it” policy regarding premiums.
We have seen spurts of value stocks outperforming growth over several periods this year. This is something we think that can continue into the future. We have modestly reallocated portfolios where value is light, which often adds diversification and additional income. Our optimistic outlook for the markets long term continues despite many uncertainties. The old Wall Street adage of “The market climbs a wall of worry” is something that we believe will ring true over the next several years. Stay safe!
Best regards,
Ken
The information contained in this report does not purport to be a complete description of the securities, markets, or developments referred to in this material nor is it a recommendation. The information has been obtained from sources considered to be reliable, but we do not guarantee that the foregoing material is accurate or complete. Any opinions are those of Ken Lampos and not necessarily those of Raymond James. Expressions of opinion are as of this date and are subject to change without notice. There is no guarantee that these statements, opinions or forecasts provided herein will prove to be correct. Investing involves risk and you may incur a profit or loss regardless of strategy selected. Past performance does not guarantee future results. Future investment performance cannot be guaranteed, investment yields will fluctuate with market conditions.
