Tuesday, February 26, 2019
Saturday, February 23, 2019
Friday, February 22, 2019
Fw: New tools
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On Friday, February 22, 2019, 2:01 AM, Steadyhand Blog <info@steadyhand.com> wrote:
New tools
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New tools
by Scott Ronalds
Who doesn't love a shiny new tool?
If you're in the market for a simple, diversified portfolio, we've got just the tool you need — our new Portfolio Builder. It uses our two fund-of-funds (Founders and Builders) along with our income funds (Savings and Income) to create a range of portfolios, whether you're seeking stable income, aggressive growth, or something in between.
You can play with the Portfolio Builder to explore various types of portfolios and the kind of investors they're suitable for. Or, if you know the breakdown of stocks and fixed income you're looking for (what we call a Strategic Asset Mix), the tool can provide you with a recommended mix of our funds to achieve it.
We've also updated our Asset Mix Look-through tool by bringing our two new funds into the mix — the Global Small-Cap Equity Fund and Builders Fund. The tool provides a look-through, or x-ray, of the asset mix of all our funds, and any combination thereof. It's designed for the more hands-on investor looking to construct a tailor-made portfolio using our income and equity funds.
Go ahead, start building. If you get stuck, give us a call at 1-888-888-3147. We're here to help.
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Recent Articles:
Two new funds at Steadyhand
Five deeply ingrained misconceptions about the market
Clients statements at Steadyhand
Want to know how risky your portfolio is? How it performed in 2018 will give you a good idea
Clarifying book value
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Tuesday, February 19, 2019
Tuesday, February 12, 2019
Fw: Five deeply ingrained misconceptions about the market
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On Tuesday, February 12, 2019, 2:03 AM, Steadyhand Blog <info@steadyhand.com> wrote:
Five deeply ingrained misconceptions about the market
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Five deeply ingrained misconceptions about the market
Republished courtesy of the National Post
by Tom Bradley"Just 20 years ago, 29 per cent of the world population lived in extreme poverty. Now that number is nine per cent."
This is one of many interesting facts in a Hans Rosling book, Factfulness — Ten Reasons We're Wrong About the World and Why Things Are Better Than You Think, in which he endeavours to correct misconceptions about the state of our planet.
Unfortunately, the investment industry also has its share of deeply ingrained misconceptions. Here are five of them.
Ability to predict markets
Too many investors believe the stock market is predictable. They see the ups and downs as being foreseeable and, as a result, base their strategies on a market call.
The reality is we have zero ability to predict the market for anything shorter than five years. Even if it were possible to reliably forecast thousands of political, economic, structural and behavioural factors, it would also be necessary to determine how they interact.
The myth of market timing persists because there's always someone who has called the latest zig or zag. But if you flip a coin, you'll be right 50 per cent of the time, too.
The economy-market link
On the same theme, investment strategies are often based on an economic view. For example: The market will continue going up because the economy is strong.
Stock prices are driven by profits, which are fuelled by economic activity, but the linkage between economic statistics and the stock market is tenuous at best. Mr. Market is not looking at the latest numbers, but is rather trying to anticipate what they'll be in 12 to 18 months.
The Trump effect
There is a perception at times that one dominant issue or factor is driving stock prices, whether up or down. Recent examples include Greece, China, gridlock in Washington, the next U.S. Federal Reserve move and, of course, Donald Trump.
But the stock market is a complex animal. Investors consistently overestimate the impact of an action (or inaction) by a central banker or government official. These and other players may have an impact for an hour or day, but rarely does it last.
Fees don't matter
I hear too often that fees aren't important; it's results that matter.
It's true that investor outcomes are what it's all about, but future returns are not guaranteed, so you always want to tilt the field in your favour.
To use an extreme example, I like my chances of beating a hedge fund manager who charges three-to-five per cent (including performance fees) if I have a fee of one per cent. I don't have to be as smart or aggressive, because I start each year with a lead of two-to-four percentage points.
Costs have a huge impact. On a $500,000 portfolio, saving even one percentage point on fees is the equivalent of a new car every 10 years.
ETFs always beat mutual funds
You've no doubt read that low-cost exchange-traded funds always beat actively managed mutual funds. It intuitively makes sense, given that costs matter.
But the proof for this belief comes from a flawed source: Standard & Poor's Indices Versus Active Funds (SPIVA) scorecard, which is regularly referenced even though it's an apples-to-oranges comparison. Indeed, ETFs aren't even included in the study.
SPIVA uses market indexes as a proxy for indexing. That means no fees or trading commissions, and no allowance for tracking error (in aggregate, pre-fee ETF returns lag comparable indexes). Mutual fund returns, on the other hand, are shown after subtracting management fees, fund expenses and, in most cases, advice or trailer fees.
It would be a much tighter race between ETFs and mutual funds and make the headlines far less compelling if a like-for-like analysis was done.
Investors need to cut through the industry lore to see that stock markets aren't predictable, no matter how much economic analysis is done; that fees matter, particularly in a two-per-cent interest rate world; that product comparisons must be based on comparable products; and, as Rosling notes in his book, that they "stay open to new data and be prepared to keep freshening up your knowledge."
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Recent Articles:
Clients statements at Steadyhand
Want to know how risky your portfolio is? How it performed in 2018 will give you a good idea
Clarifying book value
The benefits of diversification
Market narratives spread like epidemics and can turn on a dime
Copyright © 2019 Steadyhand Investment Management Ltd., All rights reserved.
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Steadyhand Investment Management Ltd.1747 W 3rd Ave, Vancouver, BC, CanadaVancouver, BC V6J 1K7Canada
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Monday, February 11, 2019
Fw: REITs Acting Nothing Like Defensive Plays
Best ETFs: REITs Acting Nothing Like Defensive Plays
- JUAN CARLOS ARANCIBIA
- 2/07/2019
Real estate investment trusts often behave as defensive stock plays, but they've been moving with the broad market, helping those assets become some of the best ETFs.Cannot load M3U8:Seven exchange traded funds in this month's ETF Leaders screen are REITs, or real estate funds. All seven are forming V-shaped recoveries that mirror the general market indexes. Not only that, but the REIT ETFs are at or near new highs — way better than major market indexes that are 7% to 10% off prior highs.Clearly, these funds are not playing the role of defensive assets. Normally, REITs gain favor in weak markets because investors can use their big dividends to make up for losses of capital. Yet, REITs came down sharply during the bear market of late 2018. The seven ETFs, however, fell 14% to 16% from their 2018 peaks, so they did fare relatively better than the whole market.While the ETFs are near buy points, the fast decline and rebound that their charts have traced is not ideal. Such fast recoveries set up the possibility that shares will pull back to digest larger-than-normal gains. There's also the risk of a selling spree now that investors who bought at previous highs can break even on their investments.One factor influencing REIT performance is interest rates. REIT dividend yields compete against bond yields. With the benchmark 10-year Treasury yield trending lower since November, REIT dividends become more attractive. The Federal Reserve has signaled a pause in rate hikes, which favors REITs.Industry Outlook MixedThe longer-term outlook for the industry is not dependent entirely on interest rates, and is mixed."U.S. REITs seem to lack a catalyst for outsized returns, given that commercial property prices, net operating income and occupancy appear to have peaked," Wells Fargo Investment Institute noted in a report. "The flip side to the U.S. economy (and REITs) having been more resilient is that they likely lack the same bounce-back return potential should the global macro overhangs get resolved."Here's where the seven ETFs on the screen stand:
- Schwab U.S. REIT SCHH is just above the 43.41 buy point of a double bottom base. The $5 billion fund tracks a mix of residential, retail, office and other types of REIT companies.
- SPDR Dow Jones REIT ETF (RWR) is above a 96.96 buy point. The $2.77 billion fund tracks the same Dow Jones Select REIT index that the Schwab fund does.
- IShares Cohen & Steers REIT (ICF) is in buy range of a 106.24 buy point from a cup base. The $2.06 billion fund is diversified among retail, residential, industrial, specialized and other types of REITs.
- Fidelity MSCI Real Estate Index ETF (FREL) is above the 24.97 entry of a double bottom. The $715 million fund has more than 170 holdings in various types of REITs.
- Vanguard Real Estate ETF (VNQ) has climbed above the 83.41 buy point of a base. The $53 billion fund owns nearly 200 stocks of different stripes.
- IShares U.S. Real Estate ETF (IYR) is above an 83.09 buy point. The ETF is predominantly invested in REITs but also owns some real estate services, developers and other stocks. At $4.07 billion in assets, it is the largest of the seven ETFs.
- IShares Global REIT (REET) is holding above a 25.76 buy point. The $1.49 billion fund has nearly 65% of assets in U.S. companies and the rest in Japan, Australia, Europe and other regions.
Pei (Claire) Qiao | Mortgage Specialist Associate | RBC Royal BankCell 778.846.6096 | Email pei.qiao@rbc.comOn Behalf of Jason Wang | Mortgage Specialist | RBC Royal BankCell 604.809.9264 | Email jason.wang@rbc.comOffice Burnaby Main Branch @ 4370 Kingsway Burnaby BC V5H 4G9_______________________________________________________________________
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Sunday, February 3, 2019
Fw: Steadyhand Monthly Newsletter - February 2019
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On Friday, February 1, 2019, 8:30 AM, Steadyhand <info@steadyhand.com> wrote:
Steadyhand Newsletter
February 2019
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Ideas for your RRSP and TFSA contributions
Not sure where to invest this year's RRSP or TFSA contribution? We've got a few ideas.
Inside Steadyhand
Where to from here?
Stock market volatility has returned with a vengeance. What are investors to make of it? How have we navigated the choppy waters? And what are we currently doing in our funds?
Be sure to join us at one of the stops on our almost sold out cross-country tour this month as we provide an assessment of the current investing environment and share our thoughts on where we go from here. For further event details, click here.
Latest news & views
RRSP deadline Only 28 days left! March 1 is the last day to make an RRSP contribution for the 2018 tax year. Give us a call (1-888-888-3147) if you want to make a contribution or discuss your accounts.
The benefits of diversification A colourful look at the benefits of diversification.
Clarifying book value Book value is a term that can be confusing. We seek to clarify it.
Fear of the unknown Some words of wisdom from the steadiest of hands in this charged environment.
Client statements Client statements are an important part of your investing experience. Here's a reminder of what you'll find on your Steadyhand statement.
Funds
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