Single Point of View

Single Point of View is our way to occasionally share planning ideas relating to personal finance. Our goal is to pass along concepts that you may not be exposed to on a daily basis.

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Stock-picking Mutual Funds die hard… for now

The ability of traditional Mutual Fund stock-pickers to deliver out-performance has been decaying for 2 decades. A recent WSJ editorial by renowned finance scholar Burton Malkiel sites the most recent stats published by Standard-&-Poor's and they are absolutely ugly. •“More than 90% of active US managers under-performed their benchmark indexes over a 15-year period.”  •“Over 85% of small-cap managers under-performed the S&P Small-Cap Index.” •“Since 2001, 89% of actively managed International funds had inferior performance. “ •“Even in less efficient Emerging markets, index funds outperformed 90% of active funds” The total value of US public stocks is worth 25 Trillion dollars, and though active stock-picking funds still dominate with market share at around 67%, over the last 5 years their share has declined by 12%.  In terms of new money flows, the Market-Tracking index products have been taking 75-80% of the available dollars. This is partly a reflection of younger investors’...
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Markets are not always efficient, nor right

Of the 46 previous declines of -10% or more in the stock market (S&P500), a little more than a third (19) became bear markets, defined as a drop of at least -20%.  Most of the -10% pull-backs – as sharp and painful as they are - turned out to be just false signals and momentary detours as the market resumed its upward march within months.  The Market at times becomes divorced from fundamentals, and over-obsessed with ‘headline’ risk.  Over-interpreting the ‘signal’ from these pullbacks is almost always a losing proposition.  Discipline in the face of noise is essential to long term out-performance. I have also observed that every now and then different asset markets go through bouts of over-pessimism or over-optimism. You may hear that a certain asset class (e.g. high-yield bonds) or sector (e.g. pharma) is ‘trading on sentiment’ rather than fundamentals; or that its price reflects an implausibly negative...
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Rene Jarquin - My Personal Story

I believe America’s economy is exceptional.  Despite the many head-winds faced in the last decade, there is no country where I would rather raise my family and pursue my passion - investing. In my first blog I thought that you should get a sense of who I am, so let me do so through a short personal statement. I was 9 years old when my family fled the communist take-over of Nicaragua.  My parents were 42 and 36, so I have first-hand experience of economic loss born of political risk - and what it means to start over.  I suppose like most immigrants to the US, I tend to think there is no better place to invest than here.  I am aware of my bias, and I am not blind to our flaws – perhaps none more glaring than the conditions that led to the sub-prime crisis a decade ago.  Even...
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Rene Jarquin: SPP Welcomes New Partner

Rene Headshot 4Each decision we make at Single Point starts with the question: “Will this improve the quality of advice, service, and overall experience for our clients?” Never have I been more certain of the answer to that question than when making the decision to bring on our new partner, Rene Jarquin. I am very excited to share the news that Single Point Partners is welcoming Rene Jarquin to the firm as Chief Investment Officer.  Rene is a deep investment thinker who will elevate our cross-asset allocation and research capabilities.  Rene is someone I have worked closely with, and known personally, for over 6 years.   As we explored the possibility of Rene becoming part of the Single Point family, we started with a shared vision of financial advice being a partnership between our clients and us.  We strongly believe that a team approach built with members with unique areas of expertise and...
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Fidelity Trading Costs Reduced

Very good news for our clients with accounts held at Fidelity.  Fidelity has announced that it has reduced trading costs on equity trades (including Exchange Traded Funds) from $7.95 to $4.95 per trade.  As you may know, there are a number of iShares ETFs that trade at no cost on Fidelity's platform as well.     We wanted to make you aware of this change as it impacts many of you (in a positive way).
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