All Posts By

buhvdesigns

Inside the Economy with SH&J: Interest Rates

By | Economic Discussion, Economy, SH&J Blog | No Comments

On this week’s Inside the Economy, we discuss the latest decision from the Federal Reserve to cut rates in October. Is the latest cut a mid-cycle adjustment or has a new trend emerged? How do 30 year mortgages and HELOC’s compare and contrast over time to the fed funds rate and what does it all mean? The yield on the 10-year U.S. treasury is trending towards all-time lows, but it remains much higher than other country’s debt. How can bonds have a negative yield and what are central banks trying to encourage businesses and consumers to do? Lastly, will there be a recession in 2020? Tune in to find out!

 

ESG Investing 101

By | Investing, SH&J Blog | No Comments

What is ESG Investing

Many people think that ESG investing is simply investing in companies that are more environmentally friendly than a typical company. ESG actually represents more than just sustainable environmental factors. ESG is short for Environmental, Social, and Governance. Companies are assigned scores based on how well they implement policies that excel in these three areas. 

The environmental factor is straightforward. A company with a high environmental rating will display sustainability practices as to not harm the environment, as well as being proactive on issues such as climate change. A company that scores well in the Social factor would exhibit diversity throughout the company, as well as be outspoken on social issues such as human rights and animal welfare. Corporate governance is probably the least well-known factor of the three. Corporate governance reflects how a company is structured. A company that scores well on this factor would exemplify responsible executive compensation and/or above average employee compensation.

Socially Responsible Investing; How do they Differ?

Many people often think ESG and SRI investing are synonymous, but there are some key differences between the two investing styles. First, ESG is a scoring system. Companies are graded on how well they embody the three factors that were discussed in the prior paragraph. SRI uses screens to filter out companies that exhibit certain qualities. For example, if you wanted to own a fund that didn’t own any companies that relied on fossil fuels, this would be an SRI fund. SRI funds can also screen-in companies that engage in a variety of ESG and SRI factors, such as environmental sustainability.,

 How to Invest in an ESG Portfolio

According to the 2018 Report on U.S. Sustainable, Responsible and Impact Investing Trends, there was over $12 trillion invested in SRI and ESG strategies in the U.S. alone. This number is only expected to grow over the next decade. The easiest way to implement an ESG portfolio is by using mutual funds and ETFs. Mutual funds that are dedicated to ESG investing have an ESG mandate, meaning they can only select companies that score highly on the ESG scale. These ESG mutual funds typically have higher expense ratios than non-ESG funds due to the extensive screening process. ETFs are a more cost-effective way to invest, as they track various indices. There are now over 1,000 unique ESG indices. 

Sharkey, Howes, Javer has ESG portfolios available to clients. If you would like to learn more about ESG investing and how you can implement a socially-conscious portfolio, please contact us or call 303-639-5100

Inside the Economy with SH&J: The Future of GDP & Fossil Fuels

By | Economic Discussion, Economy, SH&J Blog | No Comments

On this week’s Inside the Economy, we discuss the continuation of the economic slowdown. The U.S. economy is still growing, but at a slowing rate according to GDP numbers. What can we expect from the Federal Reserve over the next few years and how may that affect GDP? The wavering global economy continues on a path of uncertainty; what part does the U.S. dollar play in the global market volatility? Many of us have seen firsthand the growing presence of wind turbines throughout Colorado, the Midwest and beyond. But what impact are they really having in the energy world? Tune in to find out!

Inside the Economy with SH&J: ISM Numbers & Inflation

By | Economic Discussion, Economy, SH&J Blog | No Comments

On this week’s Inside the Economy, we discuss the recent ISM (Institute of Supply Management) numbers. The numbers indicate slowing in the U.S. manufacturing sector. Is the rest of the U.S. economy starting to contract as well? What affect does all of this have on worker’s wages? We are now starting to see how tariffs are beginning to impact the U.S. consumer. Will the tariffs have an effect on inflation too? Tune in to find out the answers to these questions and more!

Market Insights & Commentary

By | Investing, SH&J Blog | No Comments

The summer months are a historically dull time in the stock markets. This is a time when many of the powerful fund managers and traders take their vacations and there isn’t a whole lot of activity going on. The summer of 2019 has been different, however, as there have been a multitude of headlines that have moved the markets in both directions.

The topic that has ruled the headlines this summer has been the continuing trade talks with China. All year long there has been constant back and forth between President Trump and President Xi threatening each other’s economies with tariffs. This uncertainty is putting a strain on the global supply chain, causing stock market investors to be weary. The U.S. and China are still in discussions on what a trade deal could look like, but until that comes to fruition expect more ups and downs in global stock markets.

International stocks saw a nice rebound the first 5 months of the year, as the EAFE index (tracks large company stocks in Europe, Australia, Asia, and the Far East) was closely tracking the performance of U.S. markets. There has been a divergence over the past 3 months, however, mainly due to the bleak economic data coming out of the European Union. Europe may already be in a minor recession.

All the chatter surrounding tariffs and a global economic slowdown has seen investors flee for safety this past summer. When investors get spooked by the stock markets, they put their money in long-dated bonds. This demand for longer maturity bonds drives bond prices up, thus lowering the yield. When shorter term bonds are yielding more than longer term bonds, it’s called a yield curve inversion. This inversion has historically been a recessionary signal.

So where do we go from here? When you peel back all of the headlines surrounding the stock market and look at the fundamentals of the U.S. economy, there seems to be no sign of a recession in the near term for the U.S. 75% of S&P 500 companies beat their Q2 earnings estimates, unemployment remains around 4%, and the U.S. Consumer Confidence index remains high. A recession may take up to two years to manifest after an inversion, and on average the stock market advances another 13% before the recession. Going into an election year, these next 3 months are sure to be another bumpy ride in the stock market. As long as investors know how much risk they are taking in their portfolios, no outcome should come as a surprise. Contact Sharkey, Howes & Javer

Inside The Economy with SH&J: PMI Numbers & Household Debt

By | Economic Discussion, Economy, SH&J Blog | No Comments

On this week’s Inside the Economy with SH&J, we discuss the recent Purchasing Managers Index (PMI) numbers. The manufacturing numbers have been in a downward trend for about a year now. How close are we to seeing these numbers signal a contraction in manufacturing? Has the change in interest rates had any effect on the U.S. dollar? The total household debt in the U.S. is about 100% of net disposable income. How does this compare to other countries around the world? Tune in to find out!

Why You Should Invest in a Financial Advisor

By | Investing, SH&J Blog | No Comments

Are you starting to feel under the weather? Search your symptoms on WebMD. Need to talk through an emotional issue with a licensed professional? You can now text an online therapist. Have a few extra dollars and need help investing in the markets? Hire a “robo advisor”. Thanks to the evolution of technology, advice is more accessible than ever. With many inexpensive options for investing, why should you invest in a traditional financial advisor?

 

The role of a financial advisor has progressed tremendously over the last 50 years. Advisors used to specialize in one aspect of your financial life. Your financial advisor could’ve been your stockbroker who assisted in managing your investment portfolio, or they could’ve been an insurance agent who you bought life insurance from. Today, you can hire a CERTIFIED FINANCIAL PLANNER™ who will provide you comprehensive financial planning.

While investment management is part of your overall financial picture, it is only one component. Advisors now provide additional value by acting as an ally to clients during major life decisions that may create financial stress. Barron’s reports that the industry average cost for financial advice is 1% of assets under management. By working to control behavioral tendencies of the average investor and coaching clients through pivotal times, advisors as a whole can be worth the fees. According to a study done by Vanguard, advisors who follow best practices in wealth management can add an additional 3% in net returns over the long term, with half of that coming from behavioral coaching.

Investing is an emotional activity. Whether derived from fear, greed, or past experiences with finances, most investors have an emotional tie to money. Financial experts can work with you to keep these emotions at bay, while staying focused on your goals and identifying hidden risks along the way. A good financial advisor will provide a roadmap for your financial goals and keep you motivated to achieve them.

Are you or a loved one interested in working with a financial advisor? Contact Sharkey, Howes & Javer today to speak with a CERTIFIED FINANCIAL PLANNER™. We’ll work with you to align life goals with financial realities through financial planning and investment management.

Inside The Economy with SH&J: Dollar Strength & Corporate Earnings

By | Economic Discussion, Economy, SH&J Blog | No Comments

On this week’s Inside the Economy with SH&J, we discuss the strength of the U.S. dollar and its correlation with changing interest rates. Since the Fed started raising rates, the U.S. dollar has strengthened. Will that trend continue now that the Fed is reversing course? Even with the recent volatility, the U.S. Stock market is still near all-time highs. Have corporate earnings kept up with the increase in stock prices this year? Tune in to find out!

Inside The Economy with SH&J: Housing Prices & Corporate Earnings

By | Economic Discussion, Economy, SH&J Blog | No Comments

On this week’s Inside the Economy with SH&J, we discuss the effects of lower mortgage rates on the housing market. Which region in the U.S. is seeing home prices increase at the fastest rates? The answer may surprise you. Corporate earnings have seen robust growth since 2017. What are most corporations choosing to do with the excess profits? Tune in to find out these answers, and more!