Markets Archives - The Segrust Group

Differentiating the Major Fund Types

July 17, 2023July 17, 2023Cliff Cadle

There comes a time in many conversations I have, where I can see the nervousness build. When I see that happen, I know exactly what is going on. There is a question about an investment or strategy, but they are afraid to ask it. Maybe it’s out of fear of looking uninformed. Maybe it’s out of fear of the answer itself. Either way, I would like to tell you now, loud and clear: PLEASE ASK ME! I love answering your questions. It’s literally why I do what I do. I want to help people solve problems and put them on a solid financial path. So, in this vein, let me answer a common question, you may be afraid to ask. What differentiates Mutual Funds, Exchange Traded Funds (ETFs), and Hedge Funds? A Mutual Fund is a company. That’s the best way to think about it. That company owns securities, such...

What are Bond Yields and Why Do They Matter?

June 16, 2023June 16, 2023Cliff Cadle

Previously, I broke down some of the most common terms associated with bonds and what they mean. But there was one term I left unexplained – and often, it’s the one you hear the most about in the media. I’m referring to a bond’s yield. So, without further ado, let’s answer: Questions You Were Afraid to Ask #9:What are bond yields and why do they matter? Super-quick refresher on four of the terms we defined last time, because they’ll play a role here, too: Par Value: This is the amount that must be returned to the investor when the bond matures – essentially, the original investor’s principal. (Many bonds are issued at a par value of $1,000.) Coupon Rate: This is the bond’s interest rate, paid by the issuer at specific intervals. For instance, let’s say you owned a $1,000 bond with a 10% annual coupon rate. The issuer would...

Debt Ceiling Update

June 2, 2023June 2, 2023Cliff Cadle

On May 1, the Secretary of the Treasury informed Congress that the U.S. could default on its debt by June 1 if legislators do not raise the nation’s debt ceiling.1 This announcement was not a surprise. The U.S. officially hit the debt ceiling in January but were able to stave off any immediate effects through the use of “extraordinary measures.” (These are essentially accounting tools the government can use to pay its bills without authorizing any new debt.) The Secretary’s recent message was to let Congress know those measures are close to being exhausted. Without raising the debt ceiling, the U.S. will not have the money it needs to pay its debts. Should a default actually happen, the economic consequences could be severe. But even if Congress staves off the unthinkable, simply going down to the wire can have negative effects on the markets. To explain why that is, it’s...

Volatility Do’s and Dont’s

May 20, 2023May 20, 2023Cliff Cadle

Between rising interest rates and a recent spate of bank failures, there’s a lot of uncertainty in the economy right now. This, in turn, has brought volatility back to the markets. It’s no surprise, then, that many of my clients, friends, and family have asked me what investors should be doing about it. So, I thought I would write it down: Five Do’s and Don’ts During Times of Market Volatility 1. DON’T panic and make emotional decisions. During times of uncertainty or fear, humans are prone to make decisions based on their “fight or flight” response. Yes, this is even true of our financial decisions! When market volatility strikes, many people make knee-jerk decisions simply so they can feel like they are doing something. So they can feel “in control.” But think about when you’re driving a car, and you see an animal in the road. What happens when...

Eleven Ways to Help Yourself Stay Sane in a Crazy Market

June 1, 2016March 19, 2021Cliff Cadle

Words to ponder “Investors should remember that excitement and expenses are their enemies. And if they insist on trying to time their participation in equities, they should try to be fearful when others are greedy and greedy when others are fearful.” –Warren Buffett “Most of the time common stocks are subject to irrational and excessive price fluctuations in both directions as the consequence of the ingrained tendency of most people to speculate or gamble … to give way to hope, fear and greed.” –Benjamin Graham “In this business if you’re good, you’re right six times out of ten. You’re never going to be right nine times out of ten.” –Peter Lynch Remember that while they’re sound strategies, diversification, asset allocation, and dollar cost averaging can’t guarantee a profit or eliminate the possibility of loss. All investing involves risk, including the potential loss of principal, and there can be no guarantee...