Advice to the Advisors

Lens Viewing Downside Risk Analysis | Sheaff Brock Institutional Group

31 Dec

Innovative Research Approach Sees Stocks Through a Different Lens

As the longest bull market in history continues its (generally) upward trajectory, and as debates rage about recent “corrections,” Sheaff Brock portfolio managers continue to focus on analyzing and managing downside risk. Motley Fool, by the way, reminds investors of 5 very important things about corrections: 1. They happen. 2. They rarely last long. 3. We can’t reliably predict them. 4. They only matter in the short term. 5. They represent great buying opportunities. Keeping all five of those “tenets” in [...]

Advice to the Advisors

Midterm Elections and Impact on the Market | Sheaff Brock Perspectives

28 Aug

Midterm Elections — Before and After

Advisors are busy these days answering client concerns as investors eye the upcoming midterm elections with caution, considering factors that might negatively affect stock prices. In fact, Sheaff Brock Managing Director Dave Gilreath pointed out in a recent Knowledge Builder presentation, midterm elections have been inflection points for equity markets in the past, regardless of which party won or lost! True, Gilreath admits, there has always been a correction during a midterm year, but the interesting thing is that the [...]

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Advice to the Advisors

Market Volatility Roller Coaster Ride | Sheaff Brock Institutional Group | Advice to Advisors

04 May

At the End of the Day, Market Volatility can be Bullish

“Somewhere along the line, the word ‘volatility’ became code for a declining stock market,” Robert Burgess notes in Financial-Planning.com. “The simple fact is the recent swings are closer to what is considered normal, and investors should be thankful,” Burgess asserts. Rising volatility, he predicts, will lead to a healthier market, with better “price discovery,” which is a fancy way, he states, of saying greater differentiation in the values between good and bad stocks. It may be time to have “the [...]

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Advice to the Advisors

Sheaff Brock | Preferred Stock portfolio strategy | cat between dogs

12 Oct

There’s a Method to Dealing with Preferreds

Think of preferred stock as “middlers,” Sheaff Brock Senior Portfolio Manager JR Humphreys advises. Preferred stocks are income enhancers, yes, but they may have a higher return potential than bonds. At the same time, preferreds don’t act like other stocks, and, in fact, can carry less risk than their common cousins. In speaking with our Institutional editor, Humphreys outlined the five basic considerations he uses in the selection process when building a preferred portfolio: Liquidity—Many preferred issues are small, making [...]

By Advice to the Advisor Perspectives, Portfolios
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Advice to the Advisors

Sheaff Brock preferred income portfolio strategy - preferreds may perform well in rising interest rate environments

24 Sep

In a Rising Interest Rate Environment, Preferreds are Particularly Apropos

“We find preferred securities attractive today from fundamental, technical and valuation perspectives,” Nuveen’s Doug Baker and Brenda Langenfeld commented back in December, citing preferred securities’ “history of lower sensitivity to rising interest rates.” “Preferred securities are often more sensitive to changes in credit spreads than other types of bonds. So on a relative basis they may perform well during periods of gradually increasing interest rates,” the Nuveen authors explain. And, while “it may seem counterintuitive to expect an asset class [...]

By Advice to the Advisor Portfolios, Possibilities
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Advice to the Advisors

sheaff brock investment advisors dave gilreath downside risk protection investment risk measurement

06 Aug

Downside Protection in an Equity Portfolio

“Downside risk is an estimation of a security’s potential to suffer a decline in value if the market conditions change,” is the way Investopedia.com explains what no investor wants—the chance to lose money. “In general,” Investopedia authors observe, “many investments that have a greater potential for downside risk also have an increased potential for positive rewards.” In an interview with our Institutional editor, Managing Director Dave Gilreath explained key risk management tactics employed by the firm’s portfolio managers. In fact, [...]

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Advice to the Advisors

Sheaff Brock portfolio management fundamental research and analysis

14 Jul

Managing Portfolios with Fundamental Analysis

While technical analysts look for general stock movement patterns, fundamentalists look at individual companies, examining the earning potential and value of each stock. A corporation’s earnings, expenses, assets, and liabilities are all important factors, and fundamental analysts are looking for shares that may be undervalued at the present time by the investor community. There are two categories of fundamentalist buyers, Sheaff Brock Managing Director Dave Gilreath explained in an interview with our Institutional editor: 1. The value fundamentalist looks at price-to-book, [...]

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Advice to the Advisors

technical analysis v. fundamental analysis to determine when to buy a security | Sheaff Brock Investment Advisors in Indianapolis

10 Jul

Why Technical Analysis Matters in Portfolio Management

The “punch” is in the pattern, according to the technical analysis school of thought. The price of a stock—like the price of everything else—is a matter of supply and demand, technical analysts believe, and so they focus on generating and interpreting charts of the price and volume histories of stocks, using those to predict future movement in stock prices. Explaining in an interview with our Institutional editor that the firm’s emphasis has been on fundamental analysis, enough people believe in technical analysis [...]