Brandon Wendell, CMT
Brandon Wendell
The majority of investors blindly follow the “conventional wisdom” and the easiest path to investing. This usually includes placing their money into a 401k and or mutual funds in their IRA. They either don’t know there is a better alternative or worse, they don’t care.
Morningstar reports the average mutual fund returns for the past few years. At face value they seem as though they are doing their job in increasing your funds for retirement. But just compare the returns to that of the market itself and you see where you will be falling short of your financial goals.
Morningstar also reported that in March 2014, investors added $39 billion to equity funds.
Looking at the S&P 500 as a benchmark, if you simply invested in the market itself, you would have had returns of 45.5% over the past three years. Clearly the fund managers are not doing better than you could yourself!
Paraphrasing Warren Buffet, he once said the best way for an individual investor to be involved in the market is with an index fund. An index fund is one that mirrors the broad market index and usually has lower fees. While this is probably good advice, it doesn’t address the issue of avoiding large market crashes like we experienced in 2000 and 2008. Many people fear that it is not an issue of “if” but rather when it will happen again.
There is also the issue of flexibility. When you are investing in a fund, you generally can only redeem, (sell) your shares after the market has closed. When you are trying to time entries and exits, this can reduce returns. So an alternative is the use of ETF’s in your retirement accounts. An ETF is a passively managed basket of stocks in which you buy shares of the basket. It mimics the underlying index but allows an investor to enter or exit the fund whenever the market is open.
For instance, the SPY, (the ETF that tracks the S&P 500 index) returned over 55% in the past three years.
What if you could bolster your returns with only a few hours of work per month? In Online Trading Academy’s ProActive Investor Course, students learn how to potentially increase their returns using simple techniques.
So with the right knowledge and skills, nearly anyone can supercharge their retirement accounts using Market Timing Techniques developed and taught by Online Trading Academy. Stop accepting mediocre returns for your financial future. Learn how to get the stellar returns you need to have the healthy and happy life you deserve.
Neither Freedom Management Partners nor any of its personnel are registered broker-dealers or investment advisers. I will mention that I consider certain securities or positions to be good candidates for the types of strategies we are discussing or illustrating. Because I consider the securities or positions appropriate to the discussion or for illustration purposes does not mean that I am telling you to trade the strategies or securities. Keep in mind that we are not providing you with recommendations or personalized advice about your trading activities. The information we are providing is not tailored to any individual. Any mention of a particular security is not a recommendation to buy, sell, or hold that or any other security or a suggestion that it is suitable for any specific person. Keep in mind that all trading involves a risk of loss, and this will always be the situation, regardless of whether we are discussing strategies that are intended to limit risk. Also, Freedom Management Partners’ personnel are not subject to trading restrictions. I and others at Freedom Management Partners could have a position in a security or initiate a position in a security at any time.
Editors’ Picks
EUR/USD climbs to daily highs near 1.1820
EUR/USD now picks up pace and advances to the area of daily peaks north of the 1.1800 barrier at the end of the week. The pair’s decent move higher comes against the backdrop of a generalised lack of direction in the FX galaxy and the mild offered stance in the US Dollar.
GBP/USD trims losses, retests 1.3460
After briefly challenging its key 200-day SMA near 1.3440, GBP/USD now manages to regain some balance and revisit the 1.3460 zone on Friday. Cable’s pullback comes as the selling pressure on the Greenback gathers traction, reigniting some recovery in the risk-linked space.
Japanese Yen gives back half of early gains against USD ahead of US PPI data
The Japanese Yen (JPY) surrenders half of its early gains against the US Dollar (USD) during the European trading session on Friday. The USD/JPY pair rebounds to near 155.90 as the JPY falls back, but is still 0.15% down.
Editors’ Picks
EUR/USD: Fed calm, ECB steady, but the Dollar still leads Premium
EUR/USD is still struggling to find real traction. The pair has tried to stabilise, but momentum keeps fading, leaving the door open to further weakness.
Gold: Falling US yields, geopolitics help XAU/USD hold ground Premium
Gold (XAU/USD) gained traction and climbed above $5,200, ending the fourth consecutive week in positive territory. The next round of US-Iran talks and crucial macroeconomic data releases from the US will be watched closely by market participants in the short term.
GBP/USD: Will Pound Sterling defend key 1.3450 support ahead of US jobs data? Premium
The Pound Sterling (GBP) entered a bearish consolidation phase against the US Dollar (USD), after having tested critical support near the 1.3450 level on several occasions.
Bitcoin: Another month of losses, and it’s been five
Bitcoin (BTC) price is stabilizing around $68,000 at the time of writing on Friday, but the Crypto King is poised to close February on a fragile footing, marking its fifth consecutive month of losses since October and a rare start to the year with back-to-back monthly corrections.
US Dollar: At a crossroads; Fed steady, tariffs in flux Premium
The US Dollar’s (USD) upward momentum from the previous week seems to have encountered a tough nut to crack in the 98.00 region, as measured by the US Dollar Index (DXY).
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