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Ben’s Barn

Ben’s Barn. “3 Years Later--How worried should I be?” “Dodging a Bullet?” “What actions should I take, if any?” Thoughts from a long-time, long-term investor Thomas D. McCandless, CFA 914-572-1887. Economy & Investments. Tonight’s Agenda. Economy Fixed Income Markets International

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Ben’s Barn

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  1. Ben’s Barn “3 Years Later--How worried should I be?” “Dodging a Bullet?” “What actions should I take, if any?” Thoughts from a long-time, long-term investor Thomas D. McCandless, CFA 914-572-1887 Economy & Investments

  2. Tonight’s Agenda Economy Fixed Income Markets International Asset Class – Diversification Equities Housing Conclusions

  3. Guide to the Markets Page 15 Economic Expansions and Recessions

  4. Guide to the Markets Page 22 Employment

  5. Cyclical Sectors Guide to the Markets Page 17

  6. Small Business Guide to the Markets Page 24

  7. Guide to the Markets Page 19 Federal Finances

  8. Corporate Profits Guide to the Markets Page 25

  9. Guide to the Markets Page 18 Consumer Finances

  10. Guide to the Markets Page 33 The Fed and the Money Supply

  11. Guide to the Markets Page 34 Credit Conditions

  12. Guide to the Markets Page 36 High Yield Bonds

  13. Guide to the Markets Page 37 Municipal Finance

  14. Global Economic Growth Guide to the Markets Page 40

  15. Guide to the Markets Page 44 European Crisis: Financial System Risks

  16. Europe - Deleverage • Problem: Too Much Gov’t Debt & Too Little Growth • Credit concentration: 80% vs 25% Solvency vs Liquidity • Resolution: ECB Intervention Reduced Standard of Living

  17. Guide to the Markets Page 49 Asset Class Returns

  18. Guide to the Markets Page 45 Global Equity Valuations – Developed Markets

  19. Guide to the Markets Page 46 Global Equity Valuations – Emerging Markets

  20. Guide to the Markets Page 52 Dividend Income: Domestic and Global

  21. Guide to the Markets Page 53 Global Commodities

  22. Guide to the Markets Page 54 Gold

  23. Guide to the Markets Page 13 Deploying Corporate Cash

  24. Equity Correlations and Volatility Guide to the Markets Page 14

  25. Earnings Estimates and Valuation Drivers Guide to the Markets Page 11

  26. Guide to the Markets Page 29 Consumer Confidence

  27. Guide to the Markets Page 7 S&P 500 Index at Inflection Points

  28. The Aftermath of the Housing Bubble Guide to the Markets Page 21

  29. Best Seats on a Train Wreck Long-Term Large Cap Buys Financials: BAC, NTRS, PNC Energy: BP, CVX, RIG Health Care: BMY, JNJ, MRK, PG, SYK Consumer Staples: ADM, COST, MO, SWY, WAG Industrials: BA, DOW, GE, UNP Technology: ADP, AAPL, CSCO, HPQ, RIMM Consumer Discretionary: COH, DLB, NKE, TIF

  30. Summary (11-14-08) Diversify your assets. When investing long-term in the stock market: a) know your pain threshold (use stop loss), b) Timing your entry is THE most important investment decision. At the earliest, the stock market may not be poised for a sustained upturn until 1Q09…above norm volatility will continue.

  31. Performance 11-14-08 vs 11-14-11 S&P 500: +45% Tom’s Portfolio (equal wtd): +55% Tom’s Portfolio (incl 10% stop loss): +60% Tom’s Portfolio (incl 10% stop loss, Div): +70%

  32. New Large Cap Recommendations Financials (13%): AXP, BAC, GS, PNC, BEN Energy (12%): BP, COG, CVX, EP, FTI, RIG Health Care (12%): BMY, JNJ, MRK, PG, SYK, WPI Consumer Staples (11%): COST, MO, PEP, WAG, SJM, STPL Industrials (11%): BA, GE, GWW, GR, MMM, UNP, PH, UPS, WM Technology (20%): ADBE, ADP, CSCO, IBM, GOOG, MSFT, MA, NTAP, QCOM, TXN Consumer Discretionary (11%): BWA, COH, DLB, DW, HD, NKE, TIF, TOL, WYNN Materials (4%): ABX, ADM, DOW, FCX, MON Telecom Service (3%): T Utilities (3%): ED, D

  33. Summary: Bullish Long Term (11-14-11) Diversify your assets. When investing long-term in the stock market: a) know your pain threshold (use stop losses), b) Timing your entry is THE most important investment decision. Overweight stocks (large cap/ div), underweight bonds. Combined strength of modestly accelerating US growth, soft landing in Emerging Markets should outweigh slowdown in Europe. Stock market will remain rangebound another 3—6 months, but should be poised for a sustained upturn by mid-2012…above norm volatility will continue.

  34. Guide to the Markets Page 55 Marginal and Average Tax Rates

  35. Guide to the Markets Page 57 Diversification and the Average Investor

  36. Guide to the Markets Page 56 Historical Returns by Holding Period

  37. Guide to the Markets Page 5 Returns by Sector

  38. Guide to the Markets Page 51 Mutual Fund Flows

  39. Guide to the Markets Page 47 International Economic and Demographic Data

  40. J.P. Morgan Asset Management – Index Definitions

  41. J.P. Morgan Asset Management – Index Definitions

  42. J.P. Morgan Asset Management – Definitions, Risks & Disclosures

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