Don’t Buy Low, Sell...

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This month’s issue of The Samra Report will focus on President Trump’s proposed policies, identify areas of concern, as well as areas of opportunity.  As the market continues to show early and stable gains, bearish investors and the media continue to plant the seed of concern, reminding investors of past bubbles.  While the Wall Street Journal is correct in identifying a recent trend, where the bond and equity markets move in tandem, “a sign some investors may be losing faith”.  The Wall Street Journal fails to mention investors now have more options to choose, and no longer have to decide between treasuries or muni’s.   Investors have lost patience with low yielding treasuries, resulting in negative real-returns, and have moved into other areas of fixed income or alternative investments. 

The Samra Wealth Management 2017 Year Ahead report, highlighted some alternatives to fixed income investors, our consensus in High-Yield, Emerging Market Sovereign Debt and TIPS remains strong given the current global economic outlook.  For equity investors, 2017 continues to look like a good year, as President Trump’s policies could have a significant impact on domestic companies with cash held overseas, as well as the defense sector, industrials and financials. 

As low yielding treasuries have provided negative real-returns, the following fixed income investments are our best recommendations within this segment for 2017:

High-Yield Corporate Bonds

Although inflationary increases, and rising interest rates are bad news for High-Yield, growing demand and declines in default rates help the cause of high-yield, making it a good recommendation for the year ahead.  Investors of high-yield in 2016 witnessed a 17.5% return.  We recommend conservative investors look towards allocating to both high-yield and investment grade corporate bonds.

Emerging Market Sovereign Debt

Although EM bonds are threatened by the strengthening greenback, sovereign emerging market debt with attractive valuations purchased with a currency hedged strategy, look to be a good bet for the long-term investor.

TIPS

As long-term rates rise in an improving economy, credit is more attractive than duration.  As inflation increases TIPS maybe the closest return to a risk-free investment.  Conservative investors should look towards TIPS, as they protect from the eroding effects of inflation.

President Trumps tax plan stands to benefit some of the largest multinationals in the United States.  Effectively a tax break, allowing for the repatriation of foreign earnings.  The main beneficiaries of repatriation would be focused within the sectors of Healthcare and Information Technology.  Potentially allowing for billions of dollars to enter the U.S. economy at a much lower tax rate.  The following table shows the largest beneficiaries of repatriation.

Although we have highlighted the beneficiaries of the President’s tax reform policy, and there is significant support for these policies, as the chief executives of 16 companies, including GE, Oracle and Pfizer, sent a letter to congressional leaders in support of the GOP tax plan.  However, retailers like Walmart that expect their after-tax costs to rise substantially are upset, and for good cause.  Businesses importing apparel, or parts for assembly within the U.S. will experience most of the impact of a border tax, potentially laying more hurdles for the recently troubled auto industry, and disappearing mall staples such as Sears.  Off-price retailers like Burlington Coat Factory and Ross Stores are best positioned because they import virtually no goods from abroad.  The Economist estimates that the U.S. dollar would have to rise 25 percent to offset the proposed border adjustment tax. The following graph shows the areas that look to bear the most impact, as well as those areas that could benefit from a cross-border tax. 

Screen Shot 2017-02-27 at 5.07.07 PM.png

President Trumps policies look to face backlash, and have a detrimental effect on cross-border trade.  Regardless, we continue to recommend overweight allocations in:

Financials

Stand to benefit from President Trump’s Wall Street friendly policies and the prospect of lower corporate taxes.  Although Financials gained 22.8% in 2016, with rising interest rates and strong valuations, the financial sector looks to benefit in 2017.

Healthcare

With steps, already underway to repeal and replace Obama Care (ACA), we believe the aggressive terminology, translates to “refine”.  Given the loss of tax revenue generated by the Federal Government, and 20 million Americans would lose healthcare coverage, refining ACA is the most likely outcome.  Healthcare also stands to benefit from two other areas: (1) the repatriation of foreign earnings, and (2) the increase in demand in emerging market healthcare, prompted by an aging population.

Technology

With technological innovation impeding on all other areas of business, this looks to be a good year for technology.  Although there is concern over Trump’s immigration policies, repatriation should offset these concerns.

Industrials

With the Trump Administration’s promise of expansionary fiscal policy, we expect Industrials to see a boost.  With the prospect of a $1 trillion investment in infrastructure over the next decade, lower corporate taxes boosting business investment, and an increased military spending proposal of $20 billion, for a total of $603 billion, the near future looks good for Industrials.  

The Presidents foreign policies, attitude and campaign promises are creating opportunities away from the S&P 500.  At Samra Wealth Management, we expect small and mid-cap businesses to benefit from pro-growth policy actions, lower corporate taxes and reduced ADA requirements.  Given the administrations friendly and forgiving attitude towards Russia, and the year-to-date decline in the MICEX (-7.89%), we believe Russia presents a buying opportunity on a non-currency hedged trade. 

2017 continues to look like a promising year for investors, as President Donald Trump continues to build his dream team cabinet of business friendly-billionaires.  Although the Presidents methods and goals are unconventional, as we voyage into unchartered territory, we expect to see more volatility in March, given the following:

March 2         Northern Ireland Election

March 9          Key ECB Meeting

March 14-15    Key Fed Meeting

March 31         Self-Imposed Deadline for Brexit Talks*

 

*Referendum is likely to start a domino effect of Scotland and Northern Ireland separating from the British Union.

 

 

 

 

 

 

 

 

 

All information contained herein is derived from sources deemed to be reliable but cannot be guaranteed.  All economic and performance data is historical and not indicative of future results.  All views/opinions expressed herein are solely those of the author and do not reflect the views/opinions held by Advisory Services Network, LLC. The information and material contained herein is of a general nature and is intended for educational purposes only.  This does not constitute a recommendation or a solicitation or offer of the purchase or sale of securities. Before investing or using any strategy, individuals should consult with their tax, legal, or financial advisor

Samra Wealth Management, A Member of Advisory Services Network, LLC

 

The Fiduciary Rule...

The Fiduciary Rule...

With a new administration occupying the White House, investors have been pleased to see the stock market continue to rally, after the Presidential election, with the Dow climbing to over 20,000 for the first time.  Although President Trump has clashed with the media, and the new administrations’ actions have caused liberals to protest, nearly shutting down airports, the stock market has been little effected.  Economist Larry Summers pointed out that although President Trump’s policies have caused frustration, they have not yet affected trade.  Translation: The Presidents’ bark is worse than his bite, for now at least.  Since the global markets are not immune to U.S. policy, and with commodities prices increasing in volatility, investors sentiment is down from 46.20% at the beginning of the year to 31.58%.  The chart below shows the near perfect, negatively correlated relationship between the market, and the price of Comex Gold, which has seen a slight bump over the last few days. 

Source: Bloomberg

Source: Bloomberg

With the consumer sentiment index seeing a 5.4% decline in bullish sentiment over the previous week, it is no surprise the VIX, has seen increased activity, further strengthening our case for the addition of Alternative Investments (AI) to help dampen portfolio volatility.  With tech CEO’s from Apple, Facebookand Google coming together to protest the new administrations policies on immigration, it is unclear what is in store for the markets in the first quarter, as the President works to fill 657 positions of 690 key positions requiring Senate confirmation. 

 

Source: American Association of Individual Investors

Source: American Association of Individual Investors

As a result, the large wire-house brokerage firms have been using this time to prepare for changes in way advisors interact and invest client assets.  Since the beginning of the year, financial advisors have been receiving lists of client name, clients whose investment portfolios conflict with the Department of Labors Fiduciary Rule.  The new legislation expected to come into effect in April, has a lot of advisors worried about clients they may lose after contacting them.  Since these clients have investments, the Department of Labor has ruled do not align with the best interests of these clients, the advisor now has to offer the client another investment option which will compensate the advisor less, and could potentially result in the advisor losing the client altogether.  This is where the plot thickens:  investors should ask themselves, we’re these investment options not available when the client initially invested?  Suggesting these advisors were not doing the right thing by their clients, and alternatively selecting investments that were in the best interest of the advisor, and not of the client, compromising the fiduciary duty advisors have to their clients.

 

 

 

 

 

All information contained herein is derived from sources deemed to be reliable but cannot be guaranteed.  All economic and performance data is historical and not indicative of future results.  All views/opinions expressed herein are solely those of the author and do not reflect the views/opinions held by Advisory Services Network, LLC. The information and material contained herein is of a general nature and is intended for educational purposes only.  This does not constitute a recommendation or a solicitation or offer of the purchase or sale of securities. Before investing or using any strategy, individuals should consult with their tax, legal, or financial advisor

Samra Wealth Management, A Member of Advisory Services Network, LLC

 

 

 

 

 

 

 

 

 

The Year Ahead 2017

 

 

Content

 

3.         In Brief

4.         The Economy – The U.S

5.         The Economy – Global

5.         Developed Europe

5.         The Nordic Region

5.         Asia

6.        Important Dates

7.        Domestic Equities

7.       Financials

8.       Technology

12.      Healthcare

13.      Industrials

14.      Fixed Income

15.      Alternative Investments (AI)

 

 

 

 

 

In Brief

With global political volatility spilling over into the financial markets in 2016, the year ended on a positive note, with the S&P up 9.84%, however, a more extensive calculation with dividends, reveals the true 2016 S&P 500 return to be closer to 12.25%.  The 2017 Year Ahead, a Global Investment Outlook provides our insight for the year ahead, across the global landscape.  Essentially, our best ideas for 2017, across sector, geographical location, and asset class.

Over the next 12 months, we expect domestic equities reach double digit growth, in select sectors:

  • Financials
    •  Stand to benefit from President Trump’s Wall Street friendly policies and the prospect of lower corporate taxes.  Although Financials gained 22.8% in 2016, with rising interest rates and strong valuations, the financial sector looks to benefit in 2017.
  • Healthcare
    • With steps, already underway to repeal and replace Obama Care (ACA), we believe the aggressive terminology, translates to “refine”.  Given the loss of tax revenue generated by the Federal Government, and 20 million Americans would lose healthcare coverage, refining ACA is the most likely outcome.
  •  Technology
    • With technological innovation impeding on all other areas of business, this looks to be a good year for technology.  Although there is concern over Trump’s immigration policies, repatriation should offset these concerns.
  • Industrials
    • With the Trump Administration’s promise of expansionary fiscal policy, we expect Industrials to see a boost.  With the prospect of a $1 trillion investment in infrastructure over the next decade, lower corporate taxes boosting business investment, and increased military spending, the near future looks good for Industrials. 

With regards to geographical allocation, our consensus is on the United States, as domestic equities stand to gain for a number of factors.  We also recommend Japanese equities on a currency hedged strategy, given the dollar strengthening position against the Yen.  Europe (ex U.K) is also attractive, given steady growth, however, we recommend avoiding the UK, and focusing on the Nordic Region and Developed Europe.  The strengthening dollar should add value to the Travel & Tourism sector.

We continue to recommend investors consider high-yield over government and municipal fixed income, and allocate more towards equities and alternative investments (AI).  With low commodities prices already rising in in 2017, and real estate feeling the effects of rising interest rates, we recommend clients looking to allocate towards AI should be selective in terms of industry, and geographical location.

 

The Economy – The U.S.

Eight years into economic expansion, the bull market has continued with steady trajectory, with few signs of slowing down.  The U.S. markets have shown resilience, as equities are fairly valued, and the Fed has had to take little intervention.  The Trump victory, although a shock to the world had little effect on global markets, mainly due to the lack of transparency from the Trump administration, regarding fiscal and trade policies, as well as indications of financial deregulation, and the repeal of the Affordable Care Act. 

As the state of the U.S Economy continues to show improvement over all sectors, it is inevitable we will see signs of inflation.  Inflation supported by an expanding economy, supported by higher wages, lower gas prices, and relatively low mortgage rates.  In order to keep inflation steady, we expect the Fed to raise interest rates only once in 2017, and twice in 2018, stepping away from the broad popular consensus of twice in 2017, and two to three times in 2018.

Actions taken by the Fed, in terms of increases in the base interest rate, will negatively affect trade.  As our interest rates increase, foreign investors move assets to the United States, strengthening the greenback.  As the dollar increases in value, against foreign currencies, U.S. goods and services become more expensive for foreign buyers.  All while imports become more affordable to the U.S. consumer.

President Trumps policies are likely to be expansionary, as he leans towards protectionism, which is inflationary due to tariffs and curtailed immigration.  The Fed is willing to accept a slight increase in inflation, as long as they able to maintain close to a 2% target with a level of consistency.  Given the relatively low prices on energy, we believe Core Inflation is a better measure of the economy in the New Year.

 

The Economy - Global

Global economies have shown resilience to 2016’s two surprises: Brexit and the U.S. election.  At Samra Wealth Management we favor the following areas for geographical allocation:

  • Developed Europe
    • Technological advancements, and friendly immigration policies are leading to developed Europe to follow the United State in becoming a hub for entrepreneurial start-ups.  Cities such as Berlin, Dublin and London are just a few of the cities highlighted by the World Economic Forum, as the best cities for start-ups. 
  • Nordic Region
    • With an increased emphasis on renewable energy, the happiness of their citizens, entrepreneurial friendly policies and the best education systems in the world, the investment for the Nordic Region looks to pay off in 2017 and beyond.  The Nord’s have effectively driven down operating costs, from utilizing outsourcing and investing in cheaper and sustainable energy infrastructure.  They’ve started a war for talent, where top college graduates are investing their futures at home, as opposed to immigrating towards the West.  

  • Asia
    • Behind the U.S. Japan is our favored market, given the Bank of Japan’s continued stimulus and resilience to both Brexit and the U.S. Election, with low inflation these stimulus measures by the BOJ look to provide a jolt to the Japanese equity markets.  A weakening Yen against the dollar, causes concerns of foreign-yield risk, and we therefore recommend any investments in the Japanese markets be made on a currency hedged basis.

Source: UBS

Source: UBS

As China’s growth stabilizes, investors’ worries diminish, however we stand cautious of the Chinese market, given the PBOC’s vocal intent of devaluing the RMB, and the Private debt-to-gross domestic product, which has climbed to 200%.  Investors should look at small and mid-cap Chinese firms, and firms that are under-valued.  Trades in the Chinese market could prove detrimental to portfolios investing without an adequate currency hedge.  China could also benefit from President Trump’s trade war with Mexico.

Singapore and Hong-Kong will benefit from the global hunt for yield, however, investors of equities should be cautious, and again we recommend any investment outside of the United States to be conducted on a currency hedged basis.

With the recent demonetization in India, Indian equities look to outperform emerging markets.  However, given Narendra Modi’s ability to strengthen the Indian economy by making India an easier place to do business, and inviting in direct foreign investment.  India has something that is attractive to many foreign corporations: a young population and a rapidly growing educated middle-class.  Organizations from the National Basketball Association (NBA), Disney, Coca-Cola and Microsoft have poured billions of dollars into the Indian economy, attempting to capture additional market share, with a population that overshadows that of developed nations.  Since this strategy will likely support the Indian Rupee, any investments made in the Indian equity markets should be made with a non-hedged strategy. 

Source: BlackRock

Source: BlackRock

Domestic Equities

There is no doubt 2016 has been a rollercoaster year, a year where uncertainty has plagued the political and economic environment.  Although the quantifiable data and statistics from government departments (The Department of labor; The Department of Commerce; The Federal Reserve) have shown steady improvements:  it is now apparent that these statistics are not uniform across our economy.  A decrease in the unemployment rate to 4.6% the lowest jobless rate since August 2007, has not decreased uniformly across the United States, with rust belt states such as West Virginia and Pennsylvania trailing the nation with unemployment rates of 6.0% and 5.7% respectively.  The Bureau of Economic Analysis also indicates West Virginia and Pennsylvania per capita income has grown at 2.5% and 3.8%, far below the national rate of 4.5%.  A Trump victory, however, has boosted consumer confidence, in these states, as the index climbed to 113.7 in December, a 15-year high.  Given Donald Trumps ‘Wall St. friendly demeanor’, the year ahead looks promising to investors of domestic equities,

Over the next 12 months, we expect domestic equities reach double digit growth, in select sectors:

  • Financials
  • Healthcare
  • Technology
  • Industrials

 

Financials

“In the days following the U.S election, Financials were the best-performing sector”.  With financials being the key beneficiary to rising interest rates, banks and insurance companies should expect a good year ahead.  With President Trump Wall St., friendly demeanor, and cabinet make-up, there will be little to hold back financials this year.  However, not all financials will profit: with the advent of the Department of Labor’s Fiduciary Rule, set to come into play this April.  Insurance companies focusing on variable annuities will feel the pressure of losing out on sales opportunities, abiding by the new legislation. 

Technology

In early 2000, the dot-com bubble burst, leaving investors who opted for annualized returns of over 25% from 1995 to 2000, discouraged and ruined.   It is no surprise the media is echoing similar concerns, as the market continues to reach new highs.  At Samra Wealth Management, we believe there are reasons for concern and volatility throughout the remainder of the year, however, we do not expect a significant decline in US market valuation, with consideration to the technology sector.  Unlike the dot-com bubble of 2000, a time when great ideas just didn’t make sense in the real world, in 2016 these concepts are adding value through convenience.  At SWM, we have compiled a list of our top ideas based on the potential growth outlook in the industry as it relates to the market capitalization in each area.

 

Artificial Intelligence (AI)

“Artificial Intelligence (AI) is the new electricity” according to Tony Kim, a portfolio Manager with BlackRock’s Global Opportunities Group.  The ability to convert massive amounts of complex data to useful information can be used in every other business sector, from banking to healthcare.  Research shows AI to the best bet for future investment, as AI is on track to reach a market of $70 billion by 2020.  Investors should be cautious, as many ideas within AI will become obsolete, or replicated by larger firms that have the capabilities.  The Caveat here is, although AI could eliminate up to 47% of total US employment, it is important to remember a decline in the labor force would lead to less disposable income in the economy.  Expect domestic firms to use India and China as test markets due to their large populations.

 

Cyber Security

According to PwC; in 2015 the number of reported security incidents rose 48%, to approximately 118,000 per day, while organizations reporting financial losses in excess of $20m rose 92%.  The increased attacks are striking both corporate balance sheets, as well as brand image.  As we head towards a cashless society, with global internet penetration at an all-time high, and mobile platform increasing in popularity, it is our opinion at Samra Wealth Management, corporations of all sizes will dedicate more resources to battle cyber-attacks.  The US government has taken a proactive role in committing to fill an additional 3,500 cyber security positions by January 2017.

 

Virtual Reality/Augmented Reality (VR/AR)

Augmented Reality, which provides a user the ability to superimpose computer-generated images and data, on the user’s real world view, has seen recent advancements, with regards to optics and 3D mapping abilities.  These innovations are creating real world applications, and we expect to see further usage in the following areas:

  • Aviation & Aeronautics
  • Military & Law Enforcement
  • Education & Training
  • Medical
  • Gaming
  • Robotics

Organizations able to capitalize on AR technology are already experiencing brand recognition, and increased market capitalization.  The Pokemon Go craze is one example of an early adopter, the technology has helped Nintendo reawaken their public image, as they double their market capitalization to $42B in just seven trading sessions since the mobile game was launched. 

 

3D Printing

3D printing has the capacity to cross into every other sector, and we are already seeing the benefits within areas of: technology, communications, manufacturing and robotics.  We expect real world implementation within the medical and healthcare fields on larger scales as the practices becomes commonly acceptable.  Siemens predicts: 3D printing will become 50% cheaper and up to 400% faster in the next five years; expected to surpass $8.3B in global market by 2023.  As the automotive industry in the United States heads towards an average fuel consumption mandate of 54.5 miles per gallon, by 2025, 3D printing may be the key.  According to Mallikarjun Huralikoppi of NS-3DS a 3D consultant, 3D printers are now equipped to print more than just plastic, and have been used to print materials ranging from carbon fiber to human tissue.  

 

Drones

According to PwC; the global market for commercial application for drone technology is estimated to be $2B, and expected to grow exponentially to $127B by 2020.  Although drones have started to make an impact outside of military applications, they have not penetrated mainstream markets, due to the lag on legislation overseeing unmanned aerial vehicles.  Drones have become relatively inexpensive to make, and we see this trend continuing as demand for drone technology increases.  As Amazon, Walmart and other retailers experiment with Drone technology, this could spell bad news for shipping and logistic companies such as FedEx and UPS, as the industry has recently seen an influx of start-ups specializing in shipping and logistics.

 

Digital Marketing

Given global internet penetration and mobile internet usage at an all-time high, current trend suggest digital marketing will surpass television over the next 5 years. Our belief is based on the ability to collect data about the consumer, and the quality of this data.  With television and print media, there is little feedback to prove the success of the marketing campaign, whereas digital marketing allows the content creator to filter through multiple variables.  Digital media comes in many forms, from pop-up advertisements, to social media.  It is our opinion companies using social media effectively, by building a network of followers stand to succeed in this area. 

 

Robotics and Automation

According to the International Federation of Robotics; in 2014 robotic sales increased by 29%, with 70% of global robot sales going to 5 countries: China, Japan, United States of America, the Republic of Korea and Germany.  The majority of these sales are utilized in the automotive industry, followed closely by the manufacturing of electronic devices.  Given the reliability of robotics, and their negative correlation to the cost of human capital; it is in our opinion this move towards automation will continue with similar trajectory.

 

Mobile Internet Connectivity

Kaushik Basu, World Bank Chief Economist, recently stated “the digital revolution is transforming the world, aiding information flows, and facilitating the rise of developing nations that are able to take advantage of these new opportunities.”  A perfect example was recently highlighted by the State Bank of India Chairman, Arundhati Bhatacharya, at the Consulate General of India in New York, as Bhatacharya talked about the impact investment made by SBI in rural villages, providing Wi-Fi access to communities, on a path towards a cashless society.  Other examples supporting the growth of this segment are highlighted by increased mobile connectivity amongst all age groups, gaming, and healthcare and wellness monitoring.  

 

Solar

Solar technology first discovered over a century ago, has seen widespread availability in residential homes over the last decade, and is currently the fastest growing segment within the energy sector.  With companies from Walmart to Apple making commitments to go green, at SWM we believe companies specializing in solar technology for commercial and residential application should continue to grow at a faster pace than seen over the last decade.  The rationale behind this growth is focused in 2 main areas: brand recognition as a socially responsible business, and the decreasing cost of solar technology.  As we continue to see technological advancements in this area, and implementation around the globe, we expect to see solar technology in areas we have not seen before, powering personal computers and electronics, to transparent solar technology placed over windows and roads, as are currently being used in the Netherlands.  When power storage solutions such as home batteries have the ability to store power, we expect to see a further increase in the area of solar technology. 

Autonomous Vehicles (AV)

According to Mckinsey & Company; “it is unlikely that any on-road vehicles will feature fully autonomous drive technology in the short term,” however, automotive manufacturers are currently investing in driver assisted technology.  Tesla (TSLA) has recently made autonomous driving a reality, and this trend is expected to continue as competitors enter the market, pushing the price level down.

Wearables

CCS Insight reports the global wearable market will reach $14B this year, and is further expected to grow to $34B by 2020.  Wearables represent a segment connecting the user to health and wellness, media, retail and jewelry via technology.  With Virtual Reality and gaming joining the wearables segment, this segment continues to look attractive.  Once commercial applications have been integrated, and become mainstream in terms of training and simulation, we believe the wearables market will surpass previous expectations.

 

Healthcare

President Trump has indicated a repeal of the Affordable Care Act, we believe this is highly unlikely, and the Healthcare Sector will continue to see double digit growth in 2017.  Although we do expect to see some changes to the Affordable Care Act, these changes would assist the Healthcare Sector.  The most favorable of these prospective changes would be some form of Health Savings Account, allowing individuals to dedicate tax deferred income specifically towards their healthcare needs.  Repealing the Affordable Care Act would have a detrimental effect on the economy, at risk would be (1) 20 million Americans would lose healthcare coverage, as a result the insurance companies would lose 20 million customers; (2) Insurance companies would lose Federal Subsidies, they have calculated into their projections, given the large capital investments they made with the advent of the Affordable Care Act; (3) The Government would lose the $13.9 Billion in Affordable Care Act tax income.

 

With an aging population, and increased global wealth and healthcare awareness, the healthcare sector looks to be a good investment over 2017.  Pharmaceutical pricing could come under scrutiny with the Trump Administration looking to make improvements to the Affordable Care Act.

Source: BlackRock

Source: BlackRock

As technology impacts the world of medicine, and emergency response, we have witnessed some innovative ideas come to market.  Most recently, Rata Tata Chairman of the Tata Sons invested into the startup MUrgency Inc (pronounced Emergency).  A mobile platform in the form of an app that makes emergency response available with one tap on a mobile phone, in under 9 minutes in urban areas.  Although the one tap costs 350 INR, which converts to approximately $5.13 USD, the strategy is focused on building market share, and popularity.

 

Industrials

With President Trump’s promise of expansionary fiscal policy, we expect Industrials to see a boost.  With the prospect of a $1 trillion investment in infrastructure over the next decade, lower corporate taxes boosting business investment, and increased military spending, the near future looks good for Industrials.  However, the Trump administration may be able to affect the industrial sector, however, it is unlikely they will be able to bring back any manufacturing jobs.  Since the Presidential Election, many CEO’s have come forward and talked about keeping jobs in the United States, and the creation of new domestic jobs.  However, these CEO’s seem to only tell part of the story.  Recently Ginni Rometty, CEO of IBM, announced the creation of 25,000 new jobs, in the United States.  Unfortunately, there was no mention of the recent layoffs at IBM.  A similar story with Ford, as they cancelled plans for a Mexico plant.  President Trump failed to acknowledge that Ford had already planned to bring 700 new jobs to the United States, prior to him winning the Presidential Election.   

The real story with manufacturing is, President Trump has little control over jobs that have been lost in manufacturing over the last two decades.  These jobs have been lost due to three reasons: (1) Automation, advances in technology and robotics has made it more cost effective for human capital to be replaced by robots; (2) Offshoring, these jobs have gone to countries where labor is far cheaper than it is in the United States.  Although these jobs could come back, it is unlikely that consumers would be willing to pay the additional cost incurred by domestic labor; (3) A combination of Automation and Offshoring: although it may be cheaper to create goods in a country like China where the cost of labor is significantly cheaper than it is here in the United States, we can simply not compete with robotics operations that have been off-shored. 

 

Fixed Income

With increases in inflation, we will undoubtedly see increases in key interest rates, as the Fed acts upon its mandate for steady inflation.  Increases in interest rates will lead towards investments flowing out of fixed income, and into cash and dividend yielding equities.  Higher inflation has caused risk-free income to vanish, causing investors to look elsewhere for yield.

Although the Fed may not move as soon as some speculators may believe, interest rate increases are already priced in ahead of Fed decisions.  It is our consensus to move away from treasuries, and invest in TIPS (Treasury Inflation-Protected Securities), high-yield corporate, and select emerging market sovereign debt on a currency hedged basis.

  • TIPS
    • As long-term rates rise in an improving economy, credit is more attractive than duration.  As inflation increases TIPS maybe the closest return to a risk-free investment.  Conservative investors should look towards TIPS, as they protect from the eroding effects of inflation.  

Price Impact of a 1% Change in interest rates

Source: J. P. Morgan Asset Management

Source: J. P. Morgan Asset Management

  • High-Yield Corporate Bonds
    • Although inflationary increases, and rising interest rates are bad news for High-Yield, growing demand and declines in default rates help the cause of high-yield, making it a good recommendation for the year ahead.  Investors of high-yield in 2016 witnessed a 17.5% return.  We recommend conservative investors look towards allocating to both high-yield and investment grade corporate bonds.

 

  • Emerging Market Sovereign Debt
    •  Although EM bonds are threatened by the strengthening greenback, sovereign emerging market debt with attractive valuations purchased with a currency hedged strategy, look to be a good bet for the long-term investor.
 

Alternative Investments

A traditional "60/40" allocation to stocks and bonds may no longer be enough to provide you with the returns and diversification needed to achieve your long-term goals.  Since 1990, most portfolios carried predominantly equity risk: a 60/40 portfolio moved in the same direction as the S&P 500 Index 99% of the time.

 

Gold

With gold seeing an increase of 8.6% in 2016, we expect gold to see an increase of 7% in 2017, with an average price of $1350.  However, President Trumps policies are already causing volatility in the political landscape, we expect to see some investors move out of equities and fixed income into cash and alternatives, potentially pushing gold up to $1400.  We however, do not expect to see gold reach new highs.

 

Industrial Metals

As silver trades, significantly below its average, 2017 could see a 5% plus year for silver.  However, we expect palladium and platinum to see the biggest gains, with expectations of improving demand and rises in automotive sales. 

 

Crude Oil

We expect WTI to average $56/bbl while Brent averages $58/bbl.  Although global demand is expected to see an increase, technology in mining, and refining will keep up with the additional demand.  One Caveat to this rule would President Trump’s promise to strengthen the military.  A significant increase in the size of the United States Military would increase demand, and push prices higher, as the United States military is the largest consumer of fossil fuels in the world. 

 

Source: J. P. Morgan Asset Management

Source: J. P. Morgan Asset Management

Real Estate

Although global real estate will feel the effects of rising interest rates, with rates hovering at historic lows for so long, we doubt global real estate will affect the commercial market, although individual home buyer’s may feel the pinch.  From an investment point of view, we recommend REIT’s in Australia, Hong Kong and Singapore.  Domestically, we recommend staying away from the metropolitan areas, and looking for value in residential secondary and tertiary cities, as well as sector specific REIT’s in the healthcare sector.

 

Hedge Funds

During times of uncertainty and market volatility, Hedge Funds can help dampen the risk in a portfolio, while providing opportunities for higher return.  2017 looks to be a good year for Hedge Funds, as we expect interest rates to rise, and increases in volatility coming from an out of sync relationship between the White House and the Financial Markets.  The HFRI Fund Weighted Composite Index returned 14 percent annually from 1990 to 2006, however, since then, it has returned 3.4% up until 2016.  During times of market volatility, the HFRI has allowed investors to profit, while reducing the volatility of their portfolios.  The following graph shows how Harvard University is investing in Alternative investments, allocating 14% of $35.7B in 2016 towards Hedge Funds. 

Source: Bloomberg

Source: Bloomberg

 

 

 

 

 

Bibliography

Alaimo, K., Levine, M., Flam, F., El-Erian, M. A., Board, E., Feldman, N., … Bernstein, J. (2017, January 23). Kara Alaimo. Retrieved January 30, 2017, from https://www.bloomberg.com/view/articles/2017-01-23/how-companies-can-gird-for-a-trump-twitter-attack

Bank of America Merrill Lynch. (2017, January 10). Merrill Lynch Login. Retrieved January 20, 2017, from MerrillLynch.com,https://olui2.fs.ml.com/MDWSODUtility/PdfLoader.aspx?src=%2fnet%2fUtil%2fGetPdfFile%3fdockey%3d6208-11697339-1

BlackRock. (2017, January ). Global Investment Outlook. Retrieved January 20, 2017, from https://www.blackrock.com/investing/literature/whitepaper/bii-2017-investment-outlook-us.pdf

Cao, J. (2017, January 23). IBM touts trump-pleasing hiring plans while firing Thousands. . Retrieved from https://www.bloomberg.com/news/articles/2017-01-23/ibm-touts-trump-pleasing-hiring-plans-while-firing-thousands

Federal Reserve Bank. (2015, January 26). FRB: Why does the federal reserve aim for 2 percent inflation over time? Retrieved January 20, 2017, from https://www.federalreserve.gov/faqs/economy_14400.htm

J. P. Morgan Asset Management. (2017, January ). The Investment Outlook for 2017. Retrieved January 20, 2017, from https://mobileinsights.jpmorgan.com/micontent/501/269/1323468545918_MI_2017_Outlook_4Q16_US.pd

Kaissar, N. (2017, January 27). Nir Kaissar. Retrieved January 20, 2017, from https://www.bloomberg.com/gadfly/articles/2017-01-27/harvard-endowment-gives-boost-to-hedge-funds-in-return-to-basics

Mallya, H. (2016, May 17). Ratan Tata invests in MUrgency, a medical emergency response startup. Retrieved January 30, 2017, from All Things Mobile, https://yourstory.com/2016/05/murgency-funding-ratan-tata/

Samra, I. (2016, December 30). 2016’s biggest “Unseen” concerns... Retrieved January 20, 2017, from http://www.samrawealthmanagement.com/market-commentary/2016/12/30/2016s-biggest-unseen-concerns

Samra, I. (2016, July 31). The tech edition. Retrieved January 30, 2017, from http://www.samrawealthmanagement.com/market-commentary/2016/8/4/the-tech-edition

Samra, I. (2016, November 30). Post-election insight. Retrieved January 30, 2017, from http://www.samrawealthmanagement.com/market-commentary/2016/12/1/post-election-insigh

Skandinaviska Enskilda Banken AB,. (2016, June). Retrieved January 20, 2017, from https://sebgroup.com/siteassets/hugin/documents/2016/20160531-seb-investment-outlook-brexit-and-chinese-debt-worry-investors-en-1-httpcwshuginonlinecoms1208pr2016052016670xml.pdf

UBS. (2017, January). House View: The Year Ahead. End Game. Retrieved January 20, 2017, from file:///Users/indysamra/Downloads/year-ahead-us-version-revised-mh.PDF

World Economic Forum. (2016, November 22). What if you could start all over again? The European cities where business founders would go. Retrieved January 20, 2017, from https://www.weforum.org/agenda/2016/11/the-best-european-cities-to-launch-a-start-up/

 

 

 

 

 

 

 

Important Disclaimer

 

 

 

 

 

 

 

 

All information contained herein is derived from sources deemed to be reliable but cannot be guaranteed.  All economic and performance data is historical and not indicative of future results.  All views/opinions expressed herein are solely those of the author and do not reflect the views/opinions held by Advisory Services Network, LLC. The information and material contained herein is of a general nature and is intended for educational purposes only.  This does not constitute a recommendation or a solicitation or offer of the purchase or sale of securities. Before investing or using any strategy, individuals should consult with their tax, legal, or financial advisor

Samra Wealth Management, A Member of Advisory Services Network, LLC

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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2016’s Biggest “Unseen” Concerns...

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2016’s Biggest “Unseen” Concerns...

There is no doubt 2016 has been a rollercoaster year, a year where uncertainty has plagued the political and economic environment.  Although the quantifiable data and statistics from government departments (The Department of labor; The Department of Commerce; The Federal Reserve) have shown steady improvements:  it is now apparent that these statistics are not uniform across our economy.  A decrease in the unemployment rate to 4.6% the lowest jobless rate since August 2007, has not decreased uniformly across the United States, with rust belt states such as West Virginia and Pennsylvania trailing the nation with unemployment rates of 6.0% and 5.7% respectively.  The Bureau of Economic Analysis also indicates West Virginia and Pennsylvania per capita income has grown at2.5% and 3.8%, far below the national rate of 4.5%.  A Trump victory, however, has boosted consumer confidence, in these states, as the index climbed to 113.7 in December, a 15 year high.  Given Donald Trumps ‘Wall St. friendly demeanor’, the year ahead looks promising to investors of equities, and we have identified our sector and geographical confidence in our “Year Ahead” commentary report to be released in January.  

The media in 2016 focused on many issues, however, left investors underserved in areas that will impact the majority of investors.  We have identified the following 5 areas of concern:

  • Investing without a Plan
  • The Case Against Robo-Advisors
  • The Department of Labor Fiduciary Rule
  • Hidden Fees (Capital Gains)
  • Tax Loss Harvesting

The biggest hurdle for investors over the last two decades has been mixed market performance, consisting of 9.3% annualized returns; 3 cumulative years of declines over 10% (-10.14 in 2000; -13.04 in 2001; -23.37%), and a perfect storm scenario in 2008 with a market decline of 38.49%.  Inconsistent returns have caused fear in many investors, who have chosen to stay on the sidelines, and invested in low-yielding CD’s and Annuities, or have stayed out of the markets entirely, holding cash.  With the financial media causing unnecessary concerns, with talks of “market-bubbles”, the fact is, in the last two decades the market has returned annualized returns of 9.3% (with dividends reinvested), and a cumulative return of 597.58% (with dividends reinvested), results far better than what the average investor expects, or by the low guarantee, typically 3.5%, provided on variable annuities.  At Samra Wealth Management, we understand the importance of investing with a plan, and ensure every client has a dynamic goals-based financial plan, customized with their personal and financial goals.  This approach helps takes the “guess work” out of investing, and allows us to quantify for our clients, the progression towards reaching their financial goals.  This method of financial planning allows investors to invest with goals in mind, and helps to eliminate the emotional component of long-term investing, by planning for more than just investment returns, as investors often overlook the importance of Trust & Estate Planning; Wealth Transfer Strategies, Long-Term Care & Disability Planning, Asset Protection and Tax Efficiency Planning. 

Increased adoption of FinTech (Financial Technology), and the need for financial services firms to increase profitability has led to the advent of Robo Advisors.  A class of financial advisor that provide financial advice or portfolio management online with minimal human intervention.  Robo Advisors appeal to millennials, and to those with investable assets of less than $250,000.  Although this technology will cannibalize segments of the wealth management industry, investors with over $1 million of assets, tend to have sophisticated needs, that are beyond the capability of Robo Advisors.  With the large brokerage firms doubling-down on the capital investment needed for this platform in a hope to capture additional client segments, they may be making the mistake many other institutions have made prior with the implementation of technology: diluting their brand.  As sophisticated investors come to realize their investments are managed alongside their mailman's retirement plan, these sophisticated investors will look elsewhere for wealth management. 

With the Department of Labor’s “Fiduciary Rule” set to come in to effect, in April of 2017, this will start the overhaul of past financial advisor practices, and bring more attention to how financial advisors are compensated.  This change is long overdue, as it is not unheard of, for salespeople to enter the insurance industry, where few barriers exist.  Insurance sales staff, are able to represent themselves as financial advisors, and benefit from the comparatively high compensation paid out by variable annuities and other insurance products, without disclosing compensation to the client.  Technically, insurance salesman are not directly paid a commission, however, they receive compensation on the sale of insurance products, directly from the insurance company.  Typically, the sale of a variable annuity contract, can earn the advisor 5-8% of the initial contract value, while charging the client up to 2% a year for investment management, an additional 1.4% for (M&E) Mortality & Expense, and additional charges for added waivers.  The DOL’s Fiduciary Rule would require Financial Advisor to fully disclose their compensation to the client, when discussing retirement funds. 

Hidden fee’s are not only abundant within annuities, and are oftentimes overlooked in mutual funds.  These fee’s can be broken down into 4 categories: (1) Transactional Costs: essentially the cost of trading.  In the United States, these fees average 1.44%  (2) Expense Ratio: the cost of marketing, and management of the fund.  On average these expenses cost investors 0.90% each year.  (3) Brokerage Commissions: Typically, most individual investors are sold either a “Class A” or “Class C” Mutual fund.  “Class A” mutual funds can charge clients up to 5.75% as an upfront fee, while “Class C” mutual funds do not charge an upfront fee, however, do charge a higher annual expense over 2%. (4) Capital Gains: are the funds paid out by the mutual fund once they have sold a position, and are typically deducted from the mutual fund, annually, in December.  Unfortunately, most investors are unaware of these fee’s as mutual fund companies provide fee disclosures, hidden within hundreds of pages of the annual fund prospectus.  Furthermore, capital gains distributions can not be determined until the end of the year. 

Loss of portfolio values come not only from market losses and fee’s, however, from tax inefficiencies. Investors of mutual funds do not have the benefit of tax loss harvesting, the practice of selling a security that has experienced a loss, to offset a gain or income, since investors of mutual funds own a share of the mutual fund, and not own the underlying securities.  Most investors, are unaware of this strategy, and as a result, do not profit due to tax inefficiencies, in their wealth management strategies. 

2017 looks to be a promising year for investors, and the financial industry, however: investors of mutual funds and annuities should remain cautious, given their inefficient wealth management strategies. 

 

 

 

 

 

 

 

All information contained herein is derived from sources deemed to be reliable but cannot be guaranteed.  All economic and performance data is historical and not indicative of future results.  All views/opinions expressed herein are solely those of the author and do not reflect the views/opinions held by Advisory Services Network, LLC. The information and material contained herein is of a general nature and is intended for educational purposes only.  This does not constitute a recommendation or a solicitation or offer of the purchase or sale of securities. Before investing or using any strategy, individuals should consult with their tax, legal, or financial advisor

Samra Wealth Management, A Member of Advisory Services Network, LLC is not in the business of providing tax or legal advice, and any information contained within, is for the purpose of commentary, and not advice.  Prior to acting on any information contained in this publication, it is recommended you consult with your tax advisor or legal counsel.

Samra Wealth Management, A Member of Advisory Services Network, LLC

Post-Election Insight

Post-Election Insight

The Trump victory, although a shock to the world had little effect on global markets, mainly due to the lack of transparency from the Trump administration, regarding fiscal and trade policies, as well as indications of financial deregulation, and the repeal of the Affordable Care Act.  Although a Trump presidency still brings uncertainty, at Samra Wealth Management, we advise our investors not to stay on the sidelines and recommend increasing allocations towards Technology, Healthcare, Industrials and Financials.  

Although technological innovation and transformation is little affected by the new administration, the Tech Sector could stand to benefit greatly from lower corporate taxes, leading to repatriation of cash held overseas.  Combined with attractive valuations the Tech Sector continues to return capital to shareholders, and we expect to see this trend continue for the long-term as demand for digital data, cyber security and mobile technology continues to experience exponential growth.  We also expect to see increased activity in the Technology Sector as it relates to adapting to climate change, as Millennials focus on the need for social responsibility. 

Mr. Trump has indicated a repeal of the Affordable Care Act, we believe this is highly unlikely, and the Healthcare Sector will continue to see double digit growth in 2017.  Although we do expect to see some changes to the Affordable Care Act, these changes would assist the Healthcare Sector.  The most favorable of these prospective changes would be some form of Health Savings Account, allowing individuals to dedicate tax deferred income specifically towards their healthcare needs.  Repealing the Affordable Care Act would have a detrimental effect on the economy, at risk would be (1) 20 million Americans would lose healthcare coverage, as a result the insurance companies would lose 20 million customers; (2) Insurance companies would lose Federal Subsidies, they have calculated into their projections, given the large capital investments they made with the advent of the Affordable Care Act; (3) The Government would lose the $13.9 Billion in Affordable Care Act tax income.  

During the election circuit, President Elect Trump made it clear, he has a plan to improve the countries crumbling infrastructure.  Although his plans to improve roads, bridges and airports has gained national attention, Trump has yet to provide a concrete plan on how to pay for this plan.  Regardless, given Republicans and Democrats both agree on the need for infrastructure investment, it is likely, some form of Trumps $1 trillion plan over 10 years will move forward.  Along with Trumps Plan to strengthen the military, 2017 should prove a great year for Industrials. 

With the three major indexes closing at record highs this month, the Financial Sector is picked to be one of the top performing sectors for 2017.  Although strong valuations and economic data support this growth trend, Wall Street has high hopes with Donald Trump.  As Trump has promised to repeal Dodd-Frank and the Volcker Rule, eliminating trading and investment restrictions implemented by the Obama administration.  Although a complete repeal would be difficult, the suggestion alone indicates Trumps friendly attitude towards Wall Street. 

Given Trumps surprise victory, most investors questions: where to find value, and how to correctly allocate their portfolios to benefit from the incoming administration.  We stand with our prior months’ conviction of increased allocations towards: Technology, Healthcare, Industrials and add Financials; given the potential for financial sector reform.  For conservative investors we recommend high-yield corporate bonds and TIPS to hedge against expected increases in inflation.  In this rising interest rate environment, with the energy sector leading volatility, it is important for our clients to understand that although the United States Equity markets are favorable, we continue to recommend allocations in select foreign markets, with the addition of Alternative Investments (AI) to help dampen volatility. 

 

 

 

 

 

 

All information contained herein is derived from sources deemed to be reliable but cannot be guaranteed.  All economic and performance data is historical and not indicative of future results.  All views/opinions expressed herein are solely those of the author and do not reflect the views/opinions held by Advisory Services Network, LLC. The information and material contained herein is of a general nature and is intended for educational purposes only.  This does not constitute a recommendation or a solicitation or offer of the purchase or sale of securities. Before investing or using any strategy, individuals should consult with their tax, legal, or financial advisor

Samra Wealth Management, A Member of Advisory Services Network, LLC

The Uncertainty ahead...

The Uncertainty ahead...

As we approach year end, there are more factors of concern than there have been during any other time since the great recession.  The key word seems to be uncertainty:  continued political uncertainty; uncertainty over the FOMC’s lack of interest rate direction, and uncertainty of whether the second longest bull market in history, will head into it’s 8th year.  These uncertainties combined with the likelihood of inflation to push higher, will undoubtedly cause confusion as well as opportunity in the months ahead.

Although the media polls have Clinton with a 5 point lead, over Trump, with only 8 days remaining until the election.  At Samra Wealth Management, our duty is to act in the best interest of our clients, ignore the media, and concentrate on quantitative data and facts.  We remain confident in our prior months consensus, with Clinton’s momentum continuing to rise, and a Donald Trump victory not priced into the markets.  A Trump victory would likely cause short-term volatility, which we are not seeing; as Trump loses momentum in both Florida and Ohio.  Given our prediction of a Clinton win, it is important to remember a Republican majority in the house and senate, will not make for a significant change in legislation, with a Democratic win.  Our research indicates Technology, Healthcare and Industrials will lead sector performance, and we have pulled back from our prior month conviction in Consumer Staples.  

With the Federal Open Market Committee missing another opportunity to raise interest rates, it is unlikely we will see a rate increase in November, and we double down on our July prediction of a 0.25% increase in December.  An increase in key interest rates would also have an impact on other areas.  We recommend decreasing exposure to treasuries, and increasing allocation in TIPS, Insurance Companies, and Banks.  As the USD strengthens over foreign currencies, the impact will negatively effect trade, as domestic products increase in price for foreign buyers.  As opposed to directly investing in foreign markets, we recommend investing in US companies with strong exposure to foreign markets, limiting the currency risk.  Although firms such as Proctor & Gamble, Johnson & Johnson and Pfizer have lucrative foreign sales, they physically sell products in foreign markets.  In January 2015, Pfizer estimated that it would lose $2.8B from unfavorable currency swings.  The chart below shows: how some big American corporations that get half of their sales abroad reported weak 2015 quarterly results and lowered forecasts for the year, partly because of the impact of a strong dollar.

Alternatively, this risk is, to some degree, manageable: as companies utilize currency hedging as a way to limit these losses.  McDonalds Restaurant may be thebest example of a company managing foreign exchange risk, as McDonalds currently has locations in 119 countries world wide, and although domestic sales are on the decline, the fast-food chain continues to see better growth overseas.  Although only half of all publicly traded companies with foreign exposure hedge their currency risk, those companies utilizing successful currency hedging strategies stand to gain domestically, from offshore profitability.

As we are well into the second longest bull market run in history, the media barrage of “bursting bubbles” appears to be well over-hyped.  “Low, but rising interest rate expectations, modest inflation and a strong dollar are good for stocks”.  Given our research we have strong conviction within the following areas: 

Healthcare: The healthcare industry is close to all-time low valuations, trading at 15 times earnings, and poised for further growth under a Clinton win.  Although fears of drug pricing has recently come under scrutiny with Mylan’s EpiPen, it is unlikely with a Republican leaning Congress we will see any drug pricing reform.  As baby boomers continue to transition into retirement, we expect their increasing need of healthcare to further strengthen our view on the industry.  

Information Technology: With strong balance sheets, stable earnings and stockpiles of cash, the IT sector is poised for global growth.  In our July newsletter, “The Tech Edition”, we focused on 10 areas of IT we expect to see strong growth.  Continuing on this theme, we expect digital data, robotics and automation to be the driving force amongst technology: given the increasing need for cyber security, and advancements in automation and 3-D printing.  With IT being less sensitive to the dollar, this sector warrants increased portfolio allocation.

Telecom Services: With bond yields continuing to suffer, a rise in interest rates suggest movement out of fixed income, and into equity areas providing reasonable dividend yields.  Telecom is likely to provide an increasing yield as we see increases in interest rates, and moderate increases in inflation.  

Real Estate: As an alternative investment, real estate tends to have low correlation to the market, making it appropriate for most investor, to help dampen volatility, as the graph below shows.  However, this month, real estate was labeled as a stand-alone sector by Standard & Poor’s and MSCI, making it relatively more attractive. 

Screen Shot 2016-10-31 at 1.52.30 PM.png

Given the uncertainty in the months ahead, we continue to recommend managed strategies over passive themes.  For those investors who are unable to stomach the volatility we recommend an introduction to Alternative Investment’s, as a way to help dampen the volatility, given the low correlation Alternative Investments have with the market. 

 

 

 

 

 

 

All information contained herein is derived from sources deemed to be reliable but cannot be guaranteed.  All economic and performance data is historical and not indicative of future results.  All views/opinions expressed herein are solely those of the author and do not reflect the views/opinions held by Advisory Services Network, LLC. The information and material contained herein is of a general nature and is intended for educational purposes only.  This does not constitute a recommendation or a solicitation or offer of the purchase or sale of securities. Before investing or using any strategy, individuals should consult with their tax, legal, or financial advisor

Samra Wealth Management, A Member of Advisory Services Network, LLC

How to Position your Portfolio for the Presidential Election and Beyond...

How to position your Portfolio for the Presidential Election and beyond...

Given the lack of volatility of late, investors have reason to be concerned, with the uncertainty plaguing: the presidential election, a definitive answer from the Fed regarding an interest hike, and how to position a portfolio to weather the results of the November election.  This month’s issue of The Samra Report will provide our opinion on the direction of the presidential election, a prediction on the Fed’s interest rate decision, and how to position your portfolio given these factors, and beyond.

With the first presidential debate proving no-clear winner, we believe media risk is playing too large of a part in the current assessment of the presidential candidates.  With US media predictions aside, we believe the most likely outcome is a democratic win, favoring Clinton (69%) to Trump (28%).  Our reasoning behind this prediction:

  • During the 2012 presidential race, given the same duration to the election, at this point in time, Mitt Romney trailed Barack Obama 44.4% to 48.2,  to the 47.2 to 44.3 lead Hilary Clinton holds over Donald Trump. 
  • British bookmakers place current odds, after the first debate in favor of Hilary Clinton 4/9, over Donald Trump 7/4.

Given the June surprise of the UK’s referendum vote, our recommendation is to ensure our client’s portfolios are allocated to dampen volatility, regardless of the election outcome.  The below chart, strengthens our conviction to overweight Technology, Healthcare and Consumer Materials over the S&P 500, as the chart shows average relative sector performance during Republican vs. Democratic presidents, from 1973 to 2015.

During the September FOMC meeting, a divided Fed held interest rates unchanged.  Although not an unexpected move, with inflation and unemployment within the Fed’s target range, and the market up approximately 8% year-to-date, the decision to not hike rates in December, could prompt inflation to climb above the Fed’s target range, given full employment, and signs of higher wages.  At Samra Wealth Management, it is in our opinion the Fed should raise interest rates come December.  A delay in a rate hike, prompts the question: “is the US economy so fragile, that it cannot tolerate a 25bps raise by year-end. 

The Intelligent Investor by Benjamin Graham, the finest publication on value investing, led investors to believe a conservative allocation consisted of a portfolio made up of a 25% equity to 75% fixed-income allocation.  Although this may have served investors well up until the turn of the millennium, given the volatility of recent, this advice from Warren Buffett’s Columbia professor is now outdated.  The truth is, a conservative portfolio can consist of up to 100% invested in stock, however, this does not hold true for portfolio’s consisting of 100% fixed income, expecting a real-return after inflation, given interest rate risk.  Our recommendation to our investors is to use a researched based, actively managed portfolio, positioning their strategy to meet the goals identified by their dynamic financial plan, for their core strategy.  There are a few concerns with this approach:

  • Research that shows active managers underperforming passive investments.
  • Alternative Investments dampen returns as well as volatility
  • Benchmarks like the S&P are outperforming retail investors.

The age old debate: Actively Managed vs. Passively Managed... The truth is, in this context, passively managed investments do outperform actively managed investments.  However, this argument has gained momentum due to the large media interference, further confusing retail investors.  If we take a deeper look into this argument, the question arises: “what is the criteria of an active investment vehicle?”  The answer in two parts: (1) the investment is typically, a mutual fund, separately managed account, or ETF portfolio; (2) the investment is named an actively managed strategy, or make mention of an active philosophy in the investment description.  Given these parameters, actively managed, does not necessarily mean an investment is actively managed.  True actively managed strategies are measured by their active share ratio, a measure in percent, active share represents the portion of portfolio holdings that differ from its benchmark holdings.  That being said, true actively managed investment vehicles, those portfolios with an active share ratio of greater than 60% beat their benchmark, after fees, across all markets cycles studied, 62% of the time, with a better downside capture, providing a higher sharp ratio (risk-free return).

At Samra Wealth Management we recommend alternative investments as a method to help dampen portfolio volatility, and to provide our clients with peace of mind, and conviction during market downturns.  However, although alternative investments, such as commodities, real estate and hedge funds typically appreciate in value during market downturns, they can also dampen gains during a bull market. 

With retail investors typically comparing their portfolio performance against the S&P 500, we advise our clients to instead compare their performance against a benchmark better suited to their risk tolerance.  At Samra Wealth Management we create our client’s portfolios to correlate to the risk-tolerance reflected by the client’s dynamic financial plan, and compare returns to the adequate Dow Jones Relative Risk Index.  

 

 

 

 

 

 

 

All information contained herein is derived from sources deemed to be reliable but cannot be guaranteed.  All economic and performance data is historical and not indicative of future results.  All views/opinions expressed herein are solely those of the author and do not reflect the views/opinions held by Advisory Services Network, LLC. The information and material contained herein is of a general nature and is intended for educational purposes only.  This does not constitute a recommendation or a solicitation or offer of the purchase or sale of securities. Before investing or using any strategy, individuals should consult with their tax, legal, or financial advisor.

Recessionary Fears

Recessionary Fears The S&P 500, Dow and NASDAQ surged to all times highs this month, as oil rallied 10% to $48.52, raising the question: “how long can this last”.  As fears of recession worry investors, at Samra Wealth Management; we believe these fears have little ground in the short-term, given: strong fundamentals, decreasing unemployment, and increasing investor sentiment.  However, investors should be cautious, as we expect rough waters at the tail-end of 2017, into 2018; based on personal income levels, we predict to fall for a large portion of Americans.  Given the current economic climate, we look to project the effects of an interest rate decision by the Fed. Corporate earnings have continued to post strong and consistent results, as over 90% of the S&P posted their Q2 earnings, with 70% beating their mean earnings estimates, led by: information technology and healthcare.  However, these results are to be expected: since the early 2000’s most corporations have streamlined operations, to run efficiently; replacing staff with technology, while eliminating unprofitable operations.  Examples range from the manufacturing sector with robotics replacing human capital, to the service industry, with fast-food restaurants such as McDonalds and Panera bread introducing self-service kiosks to their customers.  In the short-term these changes provide greater opportunity in terms of profitability: after the initial investment in technology has been made, it replaces human capital, and is depreciated through accelerated depreciation, drastically reducing the cost of goods sold, and human error, while allowing operations to run at a maximum sustained level of output.  On the jobs front: in the short-term we believe unemployment will continue on a downward trajectory, however, our long-term opinion; we stand cautious ofunemployment given the jobs landscape is experiencing a shift.  Technology is replacing the dependence on human capital, globalization is consolidating operations, while retail sales shift to online sales away from traditional brick and mortar.  Inevitably these changes in infrastructure will lead to a decrease in demand for labor, lower income generated from labor, and lower consumer confidence.  We do not expect a uniform drop in per capita income, as the upper middle class and above will expect to see their income and wealth increase from alternative sources such as inheritance, income derived from retirement plans and pensions, and the sale of assets to fund retirement, or to downsize to more manageable housing.  Decreases in income levels will effect those below the poverty line, as well as the lower middle class, leading to increases in government transfer payments, decreases in consumption spending and decreased personal savings and investment. On the supply side of the equation, the cost of education continues to rise at a faster pace than inflation, with college tuition increasing 146% since January 2000.   With 38 million Americans living with student debt, the debt level of student loans has surpassed $1 trillion.  Prospective students are now considering alternative paths, opting for vocational training, and educating themselves with publicly available sources such as Coursera, an open-source platform that allows the student to take courses from some of the most renowned educational institutes, such as Stanford, MIT and Wharton to name a few, at no cost.  Students are provided with the knowledge, however, come away without a diploma, and without incurring any debt.  The cost of education combined with decreased salaries, has aided in the start-up revolution, originating in Silicon Valley, and spreading across the most rural areas of the US.  The search for higher wages is leading to migration and a push towards advanced degrees as the top 25 highest paying jobs require at the minimum a 4 year college degree.  In our June issue of The Samra Report, we predicted the Fed will increase interest rates by year end, however, we believe this action will come too late, and the Fed has missed the opportunity to raise interest rates when it would have had little impact to the US economy, however, an increase in interest rates by December 2016 will lead to strengthening of the US Dollar, lowering exports, and lower corporate income from foreign operations due to currency risk.  Regardless, our consensus is that the Fed will raise interest rates, and the raise will continue gradually until the Federal Funds Rate surpasses 1%.          All information contained herein is derived from sources deemed to be reliable but cannot be guaranteed.  All economic and performance data is historical and not indicative of future results.  All views/opinions expressed herein are solely those of the author and do not reflect the views/opinions held by Advisory Services Network, LLC. The information and material contained herein is of a general nature and is intended for educational purposes only.  This does not constitute a recommendation or a solicitation or offer of the purchase or sale of securities. Before investing or using any strategy, individuals should consult with their tax, legal, or financial advisor Samra Wealth Management, A Member of Advisory Services Network, LLC

Recessionary Fears

The S&P 500, Dow and NASDAQ surged to all times highs this month, as oil rallied 10% to $48.52, raising the question: “how long can this last”.  As fears of recession worry investors, at Samra Wealth Management; we believe these fears have little ground in the short-term, given: strong fundamentals, decreasing unemployment, and increasing investor sentiment.  However, investors should be cautious, as we expect rough waters at the tail-end of 2017, into 2018; based on personal income levels, we predict to fall for a large portion of Americans.  Given the current economic climate, we look to project the effects of an interest rate decision by the Fed.

Corporate earnings have continued to post strong and consistent results, as over 90% of the S&P posted their Q2 earnings, with 70% beating their mean earnings estimates, led by: information technology and healthcare.  However, these results are to be expected: since the early 2000’s most corporations have streamlined operations, to run efficiently; replacing staff with technology, while eliminating unprofitable operations.  Examples range from the manufacturing sector with robotics replacing human capital, to the service industry, with fast-food restaurants such as McDonalds and Panera bread introducing self-service kiosks to their customers.  In the short-term these changes provide greater opportunity in terms of profitability: after the initial investment in technology has been made, it replaces human capital, and is depreciated through accelerated depreciation, drastically reducing the cost of goods sold, and human error, while allowing operations to run at a maximum sustained level of output. 

On the jobs front: in the short-term we believe unemployment will continue on a downward trajectory, however, our long-term opinion; we stand cautious ofunemployment given the jobs landscape is experiencing a shift.  Technology is replacing the dependence on human capital, globalization is consolidating operations, while retail sales shift to online sales away from traditional brick and mortar.  Inevitably these changes in infrastructure will lead to a decrease in demand for labor, lower income generated from labor, and lower consumer confidence.  We do not expect a uniform drop in per capita income, as the upper middle class and above will expect to see their income and wealth increase from alternative sources such as inheritance, income derived from retirement plans and pensions, and the sale of assets to fund retirement, or to downsize to more manageable housing.  Decreases in income levels will effect those below the poverty line, as well as the lower middle class, leading to increases in government transfer payments, decreases in consumption spending and decreased personal savings and investment.

On the supply side of the equation, the cost of education continues to rise at a faster pace than inflation, with college tuition increasing 146% since January 2000.   With 38 million Americans living with student debt, the debt level of student loans has surpassed $1 trillion.  Prospective students are now considering alternative paths, opting for vocational training, and educating themselves with publicly available sources such as Coursera, an open-source platform that allows the student to take courses from some of the most renowned educational institutes, such as Stanford, MIT and Wharton to name a few, at no cost.  Students are provided with the knowledge, however, come away without a diploma, and without incurring any debt.  The cost of education combined with decreased salaries, has aided in the start-up revolution, originating in Silicon Valley, and spreading across the most rural areas of the US.  The search for higher wages is leading to migration and a push towards advanced degrees as the top 25 highest paying jobs require at the minimum a 4 year college degree. 

In our June issue of The Samra Report, we predicted the Fed will increase interest rates by year end, however, we believe this action will come too late, and the Fed has missed the opportunity to raise interest rates when it would have had little impact to the US economy, however, an increase in interest rates by December 2016 will lead to strengthening of the US Dollar, lowering exports, and lower corporate income from foreign operations due to currency risk.  Regardless, our consensus is that the Fed will raise interest rates, and the raise will continue gradually until the Federal Funds Rate surpasses 1%. 

 

 

 

 

All information contained herein is derived from sources deemed to be reliable but cannot be guaranteed.  All economic and performance data is historical and not indicative of future results.  All views/opinions expressed herein are solely those of the author and do not reflect the views/opinions held by Advisory Services Network, LLC. The information and material contained herein is of a general nature and is intended for educational purposes only.  This does not constitute a recommendation or a solicitation or offer of the purchase or sale of securities. Before investing or using any strategy, individuals should consult with their tax, legal, or financial advisor

Samra Wealth Management, A Member of Advisory Services Network, LLC

The Tech Edition

Tech Update

In early 2000, the dot-com bubble burst, leaving investors who opted for annualized returns of over 25% from 1995 to 2000, discouraged and ruined.   It is no surprise the media is echoing similar concerns, as the market continues to reach new highs.  At Samra Wealth Management, we believe there are reasons for concern and volatility throughout the remainder of the year, however, we do not expect a significant decline in US market valuation, with consideration to the technology sector.  Unlike the dot-com bubble of 2000, a time when great ideas just didn’t make sense in the real world, in 2016 these concepts are adding value through convenience.  At SWM, we have compiled a list of our top ideas based on the potential growth outlook in the industry as it relates to the market capitalization in each area.

Cyber Security: According to PwC; in 2015 the number of reported security incidents rose 48%, to approximately 118,000 per day, while organizations reporting financial losses in excess of $20m rose 92%.  The increased attacks are striking both corporate balance sheets, as well as brand image.  As we head towards a cashless society, with global internet penetration at an all-time high, and mobile platforms increasing in popularity, it is our opinion at Samra Wealth Management, corporations of all sizes will dedicate more resources to battle cyber attacks.  The US government has taken a proactive role in committing to fill an additional 3,500 cyber security positions by January 2017.

Augmented Reality (AR): Augmented Reality, which provides a user the ability to superimpose computer-generated images and data, on the users real world view, has seen recent advancements, with regards to optics and 3D mapping abilities.  These innovations are creating real world applications, and we expect to see further usage in the following areas:

  • Aviation & Aeronautics
  • Military & Law Enforcement
  • Education & Training
  • Medical
  • Gaming
  • Robotics

Organizations able to capitalize on AR technology are already experiencing brand recognition, and increased market capitalization.  The Pokemon Go craze is one example of an early adopter, the technology has helped Nintendo reawaken their public image, as they double their market capitalization to $42B in just seven trading sessions since the mobile game was launched. 

3D Printing: 3D printing has the capacity to cross into every other sector, and we are already seeing the benefits within areas of: technology, communications, manufacturing and robotics.  We expect real world implementation within the medical and healthcare fields on larger scales as the practices becomes commonly acceptable.  Siemens predicts: 3D printing will become 50% cheaper and up to 400% faster in the next five years; expected to surpass $8.3B in global market by 2023.  As the automotive industry in the United States heads towards an average fuel consumption mandate of 54.5 miles per gallon, by 2025, 3D printing may be the key.  According to Mallikarjun Huralikoppi of NS-3DS a 3D consultant, 3D printers are now equipped to print more than just plastic, and have been used to print materials ranging from carbon fibre to human tissue.  

Drones: According to PwC; the global market for commercial application for drone technology is estimated to be $2B, and expected to grow exponentially to $127B by 2020.  Although drones have started to make an impact outside of military applications, they have not penetrated mainstream markets, due to the lag on legislation overseeing unmanned aerial vehicles.  Drones have become relatively inexpensive to make, and we see this trend continuing as demand for drone technology increases.  As Amazon, Walmart and other retailers experiment with Drone technology, this could spell bad news for shipping and logistic companies such as FedEx and UPS, as the industry has recently seen an influx of start-ups specializing in shipping and logistics.

Digital Marketing: Given global internet penetration and mobile internet usage at an all-time high, current trends suggest digital marketing will surpass television over the next 5 years. Our belief is based on the ability to collect data about the consumer, and the quality of this data.  With television and print media, there is little feedback to prove the success of the marketing campaign, whereas digital marketing allows the content creator to filter through multiple variables.  Digital media comes in many forms, from pop-up advertisements, to social media.  It is our opinion companies using social media effectively, by building a network of followers stand to succeed in this area. 

Robotics and Automation: According to the International Federation of Robotics; in 2014 robots sales increased by 29%, with 70% of global robot sales going to 5 countries: China, Japan, United States of America, the Republic of Korea and Germany.  The majority of these sales are utilized in the automotive industry, followed closely by the manufacturing of electronic devices.  Given the reliability of robotics, and their negative correlation to the cost of human capital; it is in our opinion this move towards automation will continue with similar trajectory.

Mobile Internet Connectivity: Kaushik Basu, World Bank Chief Economist, recently stated “the digital revolution is transforming the world, aiding information flows, and facilitating the rise of developing nations that are able to take advantage of these new opportunities.”  A perfect example was recently highlighted by the State Bank of India Chairman, Arundhati Bhatacharya, at the Consulate General of India in New York, as Bhatacharya talked about the impact investment made by SBI in rural villages, providing wi-fi access to communities, on a path towards a cashless society.  Other examples supporting the growth of this segment are highlighted by increased mobile connectivity amongst all age groups, gaming, and healthcare and wellness monitoring.

Solar: Solar technology first discovered over a century ago, has seen widespread availability in residential homes over the last decade, and is currently the fastest growing segment within the energy sector.  With companies from Walmart to Apple making commitments to go green, at SWM we believe companies specializing in solar technology for commercial and residential application should continue to grow at a faster pace than seen over the last decade.  The rational behind this growth is focused in 2 main areas: brand recognition as a socially responsible business, and the decreasing cost of solar technology.  As we continue to see technological advancements in this area, and implementation around the globe, we expect to see solar technology in areas we have not seen before, powering personal computers and electronics, to transparent solar technology placed over windows and roads, as are currently being used in the Netherlands.  When power storage solutions such as home batteries have the ability to store power, we expect to see a further increase in the area of solar technology. 

Autonomous Vehicles (AV): According to Mckinsey & Company; “it is unlikely that any on-road vehicles will feature fully autonomous drive technology in the short term,” however, automotive manufacturers are currently investing in driver assisted technology.  Tesla (TSLA) has recently made autonomous driving a reality, and this trend is expected to continue as competitors enter the market, pushing the price level down.

Wearables: CCS Insight reports the global wearable market will reach $14B this year, and is further expected to grow to $34B by 2020.  Wearables represent a segment connecting the user to health and wellness, media, retail and jewelry via technology.  With Virtual Reality and gaming joining the wearables segment, this segment continues to look attractive.  Once commercial applications have been integrated, and become mainstream in terms of training and simulation, we believe the wearables market will surpass previous expectations.

 

 

 

 

 

 

 

 

All information contained herein is derived from sources deemed to be reliable but cannot be guaranteed.  All economic and performance data is historical and not indicative of future results.  All views/opinions expressed herein are solely those of the author and do not reflect the views/opinions held by Advisory Services Network, LLC. The information and material contained herein is of a general nature and is intended for educational purposes only.  This does not constitute a recommendation or a solicitation or offer of the purchase or sale of securities. Before investing or using any strategy, individuals should consult with their tax, legal, or financial advisor

Samra Wealth Management, A Member of Advisory Services Network, LLC

The Brexit edition

The Brexit Edition On June 23, British voters voted in favor of referendum, opting for a quick divorce from the EU.  The aftermath of the vote was heard around the world, and rattled global markets, as the probability of referendum by most analyst fluctuated between 15% - 40%.  The unexpected referendum has caused panic, with investors looking for a safe haven.  We expect market volatility to continue for the remainder of the year, with the following areas of interest:      • Political Uncertainty in the UK.      • Lower Growth in the EU      • Interest Rate Direction by the Fed.      • The US Presidential Election With British Prime Minister David Cameron set to exit Number 10 Downing Street, the conservative party looks towards new leadership.  The UK now faces a new challenge of finding a worthy leader, and unfortunately the candidates seem to lack favor as well as charisma.  New leadership and direction is a must, as the big banks have discussed moving operations from London to other areas of Europe.  With the UK expected to lose jobs, the EU will not escape unscathed,as we expect a decline in Eurozone GDP.  In the aftermath of the referendum vote, both Standard & Poor’s and Fitch downgraded the United Kingdoms credit rating from AAA to AA (AA+ to AA).  We expect the Federal Reserve to leave interest rates untouched for the remainder of the year, and although some analyst have predicted the probability of an interest rate cut, at Samra Wealth Management we find this unlikely, and unwarranted, given the Fed’s mandate to promote maximum employment, stable prices and moderate long-term interest rates.  Although it is not the role of the Fed to maximize corporate earnings, this would not be the first time we have seen the Fed overstep its mandate.  For investors of US equities, we expect the volatility to continue for the remainder of the year with uncertainty in the race for thePresidency, as polls show Hillary Clinton, edging out Donald Trump by a margin of 5 points.  We continue to keep a close eye on select sectors, as we expect to see a decline in financials, and energy, if democrats remain in the White House.   Given recent events, we emphasize the importance of portfolio rebalancing, diversification across asset classes, and the inclusion of Alternative Investments (AI) to help dampen volatility.  As currency investors look for a safe haven, both the US Dollar and Japanese Yen, continue to show resilience, with spreads increasing against both Pound Sterling, and the Euro. We expect to see further increases in Gold, surpassing the 21% year to date increase, however, we do not expect Gold to reach new highs. International markets have been rattled, however, the media continues to play a big part in creating widespread panic.  Inexperienced investors are quick to forget the market declines over the past year, when the market descended below 1,900 on 4 occasions.  With the S&P hovering at 2,000, we remind our clients the sky is not falling, and although Britain may be headed towards recession territory, the decline in confidence creates tactical opportunity, while making little to no changes in our clients core portfolios.             All information contained herein is derived from sources deemed to be reliable but cannot be guaranteed.  All economic and performance data is historical and not indicative of future results.  All views/opinions expressed herein are solely those of the author and do not reflect the views/opinions held by Advisory Services Network, LLC. The information and material contained herein is of a general nature and is intended for educational purposes only.  This does not constitute a recommendation or a solicitation or offer of the purchase or sale of securities. Before investing or using any strategy, individuals should consult with their tax, legal, or financial advisor Samra Wealth Management, A Member of Advisory Services Network, LLC  

The Brexit Edition

On June 23, British voters voted in favor of referendum, opting for a quick divorce from the EU.  The aftermath of the vote was heard around the world, and rattled global markets, as the probability of referendum by most analyst fluctuated between 15% - 40%.  The unexpected referendum has caused panic, with investors looking for a safe haven.  We expect market volatility to continue for the remainder of the year, with the following areas of interest:

     • Political Uncertainty in the UK.

     • Lower Growth in the EU

     • Interest Rate Direction by the Fed.

     • The US Presidential Election

With British Prime Minister David Cameron set to exit Number 10 Downing Street, the conservative party looks towards new leadership.  The UK now faces a new challenge of finding a worthy leader, and unfortunately the candidates seem to lack favor as well as charisma.  New leadership and direction is a must, as the big banks have discussed moving operations from London to other areas of Europe.  With the UK expected to lose jobs, the EU will not escape unscathed,as we expect a decline in Eurozone GDP.  In the aftermath of the referendum vote, both Standard & Poor’s and Fitch downgraded the United Kingdoms credit rating from AAA to AA (AA+ to AA). 

We expect the Federal Reserve to leave interest rates untouched for the remainder of the year, and although some analyst have predicted the probability of an interest rate cut, at Samra Wealth Management we find this unlikely, and unwarranted, given the Fed’s mandate to promote maximum employment, stable prices and moderate long-term interest rates.  Although it is not the role of the Fed to maximize corporate earnings, this would not be the first time we have seen the Fed overstep its mandate. 

For investors of US equities, we expect the volatility to continue for the remainder of the year with uncertainty in the race for thePresidency, as polls show Hillary Clinton, edging out Donald Trump by a margin of 5 points.  We continue to keep a close eye on select sectors, as we expect to see a decline in financials, and energy, if democrats remain in the White House.  

Given recent events, we emphasize the importance of portfolio rebalancing, diversification across asset classes, and the inclusion of Alternative Investments (AI) to help dampen volatility.  As currency investors look for a safe haven, both the US Dollar and Japanese Yen, continue to show resilience, with spreads increasing against both Pound Sterling, and the Euro. We expect to see further increases in Gold, surpassing the 21% year to date increase, however, we do not expect Gold to reach new highs.

International markets have been rattled, however, the media continues to play a big part in creating widespread panic.  Inexperienced investors are quick to forget the market declines over the past year, when the market descended below 1,900 on 4 occasions.  With the S&P hovering at 2,000, we remind our clients the sky is not falling, and although Britain may be headed towards recession territory, the decline in confidence creates tactical opportunity, while making little to no changes in our clients core portfolios.  

 

 

 

 

 

All information contained herein is derived from sources deemed to be reliable but cannot be guaranteed.  All economic and performance data is historical and not indicative of future results.  All views/opinions expressed herein are solely those of the author and do not reflect the views/opinions held by Advisory Services Network, LLC. The information and material contained herein is of a general nature and is intended for educational purposes only.  This does not constitute a recommendation or a solicitation or offer of the purchase or sale of securities. Before investing or using any strategy, individuals should consult with their tax, legal, or financial advisor

Samra Wealth Management, A Member of Advisory Services Network, LLC