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What Low Oil Prices Mean

If you’re disappointed with recent activity in your portfolio and feel that you need an outside perspective and expert advice about your investments and investing future, give us a call today at 800-391-11118. We offer complimentary consultations and years of proven investing success, and we’d love a chance to chat with you about your money and your investing goals.

Oil prices have fallen and are falling, and this is good for the U.S., China, India and some others, but for many other countries, such as Russia, the Middle East and Europe, this is a troubling and painful trend.

Many oil companies have gone into debt in order to do more drilling, and high oil prices have created a lot of jobs for many people. With low oil prices, there are concerns about debt defaults from these companies, and of course the concern of more unemployment and slowed economic growth. Deflation appears to be showing up in the markets and we advise investors to be alert and aware of the factors at work out there.

Most of the world is experiencing down stock markets, and the U.S. market might catch up on that downside at some point. We encourage you to ready your portfolio for deflation and volatility in the markets, and if you aren’t sure how to do so, we urge you to email Doug your questions at askdoug(at)dougfabian(dot)com or call our offices at 800-391-1118.

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Hedged Currency ETFs

Doug has a hunch that international markets will be doing better than domestic markets in 2015. A strong U.S. dollar will create a headwind for domestic investing, and it’s important for investors to be aware of the risks or changes to come.

Speaking of investing opportunities overseas, there’s a new, innovative international ETF option that you need to know about:

A Hedged Currency ETF

If you are investing in a country like Japan, and their currency goes down in value, that can be a liability for American investors. But with a hedged currency ETF, you remove that currency risk, and protect your investments overseas.

This is a great new concept that you can’t get in a mutual fund, and you need to use ETFs to get this kind of creativity and innovation for investors. This is yet another great idea for ETF investors and a way for you to invest even more successfully internationally.

(As always, if you have any questions about these tips or how we can help you master ETFs for your portfolio, please call our offices at 800-391-1118 or email Doug directly at askdoug(at)dougfabian(dot)com.)

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Important Terms for ETF Investing

The world of investing can be confusing, but it doesn’t have to be. Here are Doug’s essential ETF investing terms, so that you can be successful in your investing and feel empowered to make decisions regarding your portfolio.  As always, if you have questions about your specific portfolio, please call our offices at 800-391-1118 and we’d be happy to chat with you about your specific investments.

Here are Doug’s important investing terms and their definitions:

  • Trade – buying or selling an ETF
  • Price – the cost for your ETF investments, as prices change all the time. It’s important to get the best possible price for your investments, and keep track of what your prices are.
  • Shares – with ETFs, you have to buy a number of shares, not a dollar amount, so keep that in mind.
  • Ticker Symbol – every ETF has a unique ticker symbol, and is a great way to keep track of Exchange Traded Funds on your watch list or the ones you own, and what those ETFs are trading at right now.
  • Assets Under Management – number of dollars allocated to any specific Exchange Traded Fund, and every ETF is different in size.
  • Volume – number of shares traded on an ETF in a given day
  • Expense Ratio – what the ETF will cost you over a one year period of ownership
  • Bid Price – the “buy it now” price
  • Ask Price – the “sell now” price
  • Spread – the difference between the bid price and the ask price
  • Commission or Transaction Fee – what your broker will charge for buying and selling, and the transaction fee is incurred per trade. There are some free platforms for certain ETFs and with certain brokerages, so keep an eye out for that.
  • Market Order – buying the ETF right now at whatever price – a “buy now” order.
  • Limit Order – buying or selling the ETF at a specific price, no matter when that happens.
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Spotlight on China

In Doug’s opinion, the Chinese stock market is the best value in the world for investors. For the past three years, the Chinese stock market has been in a bear market, while the U.S. has had a bull market. Economic news is getting better for China, and we think that China is the best international investment option for many investors.

From a regulatory standpoint, outside investors have not been able to invest in China. There has been a lot of restrictions on international capital in Chinese stock markets, but those rules are changing. It will be easier for large money managers to get invested in Chinese A-Shares – this is good news for China, Hong Kong and other Asian emerging markets.

There are many options for investors who use Exchange Traded Funds to invest in China. These ETFs could be great investments for your portfolio and help you to successfully invest overseas in China. Take a look at the current ETF report, and it’s easy to see the Chinese ETFs and make good decisions about where to put your money and a potential growth solution for your portfolio.

Keep in mind that this blog is not intended to be personal investment advice – as always, if you are concerned about how Doug’s opinions could shape your portfolio or if you want our advice on using China in your portfolio, please call us at 800-391-1118 to make an appointment or ask a question.

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Special Post-Election Presentation—For Podcast Listeners ONLY!

The big question post-election is this: what does a new Republican Congress mean for your money?

While it’s too early to tell, Doug has heard some positives from Republicans regarding tax reform, regulation and job growth. There’s also a lot that may not change, and it’s vital for investors to have a long-term, forward-thinking approach to investing goals and objectives.

Find out Doug’s opinion on the change of leadership in Congress, and what that might mean for your investment portfolio in this special teleconference for Doug’s “inner circle” only. If you aren’t receiving email updates when new podcasts are posted, you won’t be invited to the special teleconference, so make sure you sign up HERE to be included in this special presentation.

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Wealth Management Despite Politics

Higher taxes, entitlement cuts, budget deficits and more bad news for wealthy Americans are coming, no matter what happens with our new and old leaders in Washington.

The world continues to make decisions as though money can be created out of thin air. Quantitative Easing works with very low interest rates, and we believe that they will stay low for the immediate future. But, when we do see higher interest rates, eventually, there will be some really unfortunate economic consequences around the world. Paying back the debt that countries have racked up is a large job and could easily create the next financial crisis. Around the world and at home, have long-term debt problems that are not easily solved and we are staying alert and aware that we cannot continue indefinitely like this.

Every Congress and every President have had budget deficits and have assured us that national debt is not a big problem. We think it’s crucial that you manage your wealth with risk in mind, so that no matter what happens in the large political sphere, you and your loved ones are prepared and protected from the storms that will come eventually.

Look at your risk and be aware of your sell discipline and your investing goals. So far everything is going well, but preparation is very important for successful investing. If you aren’t sure how to prepare or what to be concerned about, please give our offices a call at 800-391-1118 and we are happy to help.

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Market-Sector Spotlight: Energy

Oil prices are down about 20% from their highs, and so are natural gas prices and energy stocks.

There are some dividends in energy stocks, but for the most part, capital appreciation is the goal of energy investing. This sector has fallen significantly and re-priced to reflect the new low oil prices, but higher oil prices might be coming soon, particularly if Japan’s “big bet” pays off.

There are many ways to invest in energy using ETFs (more than 100 available). Here are a few examples:

  • XLE and others (large-cap energy, Chevron, Exxon, etc.)
  • Small-cap energy
  • MLPs (Master Limited Partnerships)
  • International energy
  • Natural gas

We really like natural gas and international energy for investment portfolios, and we think that some buying opportunities are setting up for you in this sector.

Please remember that this is not specific investing advice, but rather general observations – and please consult your wealth management professional before making any changes to your portfolio. If you have questions or concerns and would like a personal consultation with Doug, please call our offices at 800-391-1118 and we’re happy to help.

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Japan’s Big Bet

In Japan, we recently saw some interesting economic activity. The Japanese central bank made the decision to expand quantitative easing by about 15%, buying Japanese government stocks and bonds.

They are expanding QE because of a weak economy and low inflation there, and they are hoping to stimulate their economy and their stock market with this move. THe real loser here is any Japanese citizen who is not invested in stocks, because they will just see prices going up on basic commodities without the bonus of a strong investing environment. This is the largest and most aggressive QE program ever attempted, and no one knows what the long-term results will really be.

Japan’s big bet has set the markets on fire, and it will interesting to see how this plays out, particularly because the United States Federal Reserve has announced a pull-back in Quantitative Easing and stimulation.

Don’t forget about Doug’s special post-election teleconference for podcast listeners only! If you aren’t signed up to receive the podcast and be in Doug’s “inner circle”, you can do so here.

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Federal Reserve Policy: Quantitative Easing

Quantitative easing is going to be ending soon, and many investors and others are nervous about this and its affect on the markets. The U.S. economy has improved significantly, and interest rates and oil prices have both fallen, and that’s good news for the Federal Reserve.

It will be interesting to watch stocks and bonds as QE3 comes to a close, and we think that investors should stay aware of buying opportunities and potential set-ups in the markets. There’s a difference between short-term and long-term interest rates, and it’s wise to stay aware of those differences and their affect on your portfolio.

Central bank policies, attempting to stimulate growth, seems to us to be unwise meddling of governments. It remains to be seen if these quantitative easing policies really help world economies, and the Fed meeting will be the big market mover this week no matter what.

We see the immediate future as an unstable environment going forward, and we think that investors should stay informed, alert and aware as you manage your money and your risk.

If you have specific questions about your portfolio, please call our offices at 800-391-1118 and we’d be happy to chat about your goals and your money.

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ETF Strategy: High-Yield

This recent market correction has hit high-yield offerings quite hard lately, but we think that a high-yield ETF strategy is still a good one to look into. There was mass liquidation in some ETFs because of these corrections, and that can set up some really interesting buying opportunities for savvy investors.

Multi-asset funds and MLPs (Master Limited Partnerships) are both good options for investors to look at. Head over to our Special Reports page and download our complete ETF report and check out some of these ticker symbols for yourself. We think that some great buying opportunities might be coming soon and we advise you to be watching for these kinds of ETF options for your portfolio.

As always, please call our offices if you want precise, personalized investment advice, and keep a close eye on your investment goals as you look into these strategies. Our office can be reached at 800-391-1118, and please call us today with questions or concerns about your portfolio or our educational resources.

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