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Jul 31, 2020
You could say biotechnology companies' shares were merely "interrupted" this year. Biotech stocks, as measured by the iShares Nasdaq Biotechnology ETF (IBB), started to rally furiously in the back half of 2019. The COVID-sparked market downturn knocked them down, but they've returned to outperformance and are now up 15% year-to-date.
The party likely isn't over, either.
New markets in areas such as anti-aging therapies and gene editing could be worth billions of dollars over the coming decade. That means biotech stocks should continue to get a bid over the coming years. While you can get access to many of these firms via exchange-traded funds (ETFs) like IBB, individual equities will typically give you more "bang for the buck" if you're willing to accept more risk.
Conversely, you don't have to gamble on tiny biotech plays to put the industry's growth in your portfolio, either.
Here are five booming individual biotech stocks to buy. All of these mid- and large-sized stocks boast 30% or more gains year-to-date, but all of them still have room to run as they continue to develop game-changing technologies. Better still: They generally boast strong financial fundamentals to boot.
Data is as of July 2.
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Jul 04, 2020
It hasn't been a good year for landlords. Publicly traded real estate investment trusts—which own income-producing real estate—have been clobbered in 2020, with the category overall losing 13.6%, compared with a 5.0% loss for the S&P 500 index. When the COVID-19 pandemic struck, whole sectors of the economy shuttered practically overnight, and millions of Americans lost their jobs. For REITs that owned apartment buildings, shopping malls, hotels or office buildings, collecting rent became a tall task, and investors took notice.
But the sell-off presents an opportunity for investors who buy REITs that stand to prosper in a post-pandemic world and avoid the ones that might falter. REITs with properties that require little human contact have bright long-term prospects, says Fidelity Real Estate fund manager Steve Buller. Trusts that own data centers, industrial warehouses for online retailers or cell-phone towers will benefit in a world that is shifting increasingly online, he says. Some of this optimism is priced into the stocks—tech-oriented REITs in the S&P 500 have returned 11% in 2020, on average. But that shouldn't scare off long-term investors.
Buller sees value in select housing and office REITs that will regain steam as the economy reopens, but he says investors will face an uphill climb investing in trusts that own restaurants, child care facilities, gyms and senior living facilities. REITs that own retail properties, he says, may be permanently scarred, as buying preferences shift toward e-commerce.
The REITs below are poised to thrive. All yield less than the 4.6% average for REITs overall but sport impressive profit-growth prospects, healthy balance sheets and a history of raising payouts.
Note that instead of using traditional corporate earnings yardsticks to measure profitability, REITs use funds from operations, or FFO, which adjusts for depreciation and property sales. REIT distributions are taxed
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Jul 03, 2020
In March 2020, COVID-19 began to ravage the United States, putting the nation into lockdown and skyrocketing unemployment.
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Entering a bear market for the first time in 11 years, stocks plummeted by 30% on March 23, a substantial drop from its record in February. But while the stock market and the economy were both declining, troubles for the markets were short-lived. The 33-day bear market, spanning from Feb. 19 to March 23, soon rebounded. In fact, the S&P 500 soared 40% in the 50 days following its March 23 low.
Despite the presence of many indicators (e.g., rising unemployment, businesses closing left and right, etc.) that the economy is crumbling, stocks are staying relatively strong. There are a number of reasons this phenomenon can occur. The stock market and the economy have a fascinating relationship; the two are not one and the same.
Current Economic Climate
Unemployment levels shot up to 14.7%
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Jul 02, 2020
As the country dealt with the fallout from the coronavirus pandemic this spring, lawmakers and regulators scrambled to ease the pain of record job losses and other blows to Americans' pocketbooks and health. One result that has largely flown under the radar: Health savings accounts and flexible spending accounts, which offer a tax-advantaged way to save money for certain medical or dependent-care expenses, have become more generous. Some of the changes are temporary, but others have no expiration.
A Healthy Way to Increase Your Retirement Savings: HSAs
More expenses are covered. Thanks to the Coronavirus Aid, Relief and Economic Security (CARES) Act, you can use money from an HSA or a health care FSA to pay more expenses—and these changes are permanent. Over-the-counter drugs purchased January 1, 2020, or later are now HSA- and FSA-eligible without a prescription. Those include pain relievers, cough suppressants, antihistamines and other drugs that treat issues from heartburn to acne, says Shobin Uralil, cofounder and chief operating officer of Lively, an HSA provider. Feminine-hygiene products such as tampons, pads and menstrual cups are also qualifying expenses under the law.
Other new rules give a high-deductible health plan paired with an HSA the green light to cover certain expenses you incur as a result of the pandemic before you meet your deductible. One such
expense is telehealth, th
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Jul 02, 2020
Leah Gordon, 43, lives in Hugo, Minn., and directs the nurse anesthetist program at St. Mary's University of Minnesota. Kiplinger's talked to her about the challenges created by COVID 19 for nurse anesthetists and the problem student nurses--and the health care industry—are facing because they can't complete their bedside clinicals.
What does a nurse anesthetist do? When you heard about patients with COVID getting breathing tubes, it was primarily nurse anesthetists manning those intensive care units, placing the lines to give the medications and putting the breathing tubes between the vocal cords into their lungs.
How has the pandemic affected your job? My full-time job is as a professor and the nurse anesthetist program director at St. Mary's University of Minnesota. I did work one day a week at an outpatient gastroenterology center. In order to be a really good instructor, it's important to keep my skills fresh.
Your side gig is on hold? When COVID hit, the first thing our governor did was suspend elective surgeries. Plus, they wanted all the personal protective equipment brought to a central location. That meant we couldn't do any cases because we couldn't use our gowns, we couldn't use our shields and we couldn't use our masks.
You must have taken a financial hit. A nurse anesthetist out of school right now is earning $180,000 to $190,000. I feel like a jerk even talking about it because I'm very, very fortunate, but when you lose that side hustle, all of a sudden $50,000 is gone. I earn too much as a professor to qualify for unemployment. But I have a $1,900-a-month student loan payment, and to not have my side job right now is challenging—and I'm not sure if I'm going to get it back.
What about the rest of your family? My partner is a registered nurse who works for the same surgery center—that's how we met. He was furl
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Jul 02, 2020
A pair of encouraging jobs reports helped the major indices close in the black Thursday, and drove the Nasdaq Composite to yet another record-high finish.
Early Thursday, the Labor Department reported that the U.S. added 4.8 million jobs in June to easily surpass economists' consensus expectations for 3.7 million, while the unemployment rate dropped from 13.3% to 11.1%. Meanwhile, last week's jobless claims trickled lower to 1.34 million, from 1.38 million a week prior.
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"It is difficult to downplay the incoming June employment numbers, with both surveys showing sizable flows of workers returning to employment last month as states continued to remove restrictions on non-essential activity following the COVID-19 lockdowns in March and April," Barclays analysts wrote in a Thursday note.
"One thing that we are certain about," writes Rick Rieder, BlackRock's Chief Investment Officer of Global Fixed Income, "and is most relevant to markets, is that virtually all the numbers this month have displayed some tangible improvement, some clear reopening of the economy, albeit still very uneven by sector and region.
"We are confident that the industries that can be effective in a work-from-home framework and/or those that are deemed essential, such as healthcare or education, are showing tangible signs of improvement and employment durability. However, it is also clear that leisure, travel, energy, etc., are very uncertain in their path forward today."
Dow component Pfizer (PFE, 2.3%) enjoyed follow-through buying after Wednesday's encouraging COVID-19 vaccine news, and Walgreens (WBA, 2.7%) headed higher, too,
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Jul 02, 2020
While stocks can supercharge a portfolio, getting income out of an all-stock portfolio is difficult. Withdrawing at the wrong time can cause an investor to sell at a significant loss, hurting long-term returns. Then there is the tax issue: With long-term capital gains taxes of up to 20%, many retirees will find themselves being squeezed by the IRS as they try to live off their life savings.
There is a solution to these problems: municipal bonds, and municipal bond funds.
"Munis" have been favorites of American retirees for generations. That's not only because they provide tax-free income, but because their low volatility and high yields mean selling at a loss is very hard to do.
12 Bond Mutual Funds and ETFs to Buy for Protection
"Muni bonds are a good way to provide consistent income, and the tax angle can also provide additional value," says Ben Barzideh, Wealth Advisor with Piershale Financial Group. "Also, bonds tend to fluctuate much less than stocks, so it brings a level of diversification and safety for the overall portfolio."
But how do you buy municipal bonds? After all, they're not easily traded on exchanges such as the NYSE or Nasdaq. And most new muni bond issues are reserved for the largest municipal bond buyers - firms like BlackRock (BLK), whose $7 trillion in assets under management puts it in the front of the line, miles ahead of retail investors, when a municipality wants to sell a bond. Because the big guys have already swallowed up the lowest-risk, highest-yielding bonds on their own, individual investors just can't get their hands on them …
… unless they buy municipal bonds through the big guys. You can do this via municipal bond funds, which are issued by t
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Jul 02, 2020
Though most recent graduates aren't technically millennials, both Gen Zers and millennials who are new to the job market face unprecedented challenges in 2020. Hiring has picked up as the economy reopens, but even so, the class of 2020 is entering one of the most depressed job markets in decades.
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I was hired as a staff writer at Kiplinger in March, just weeks after I graduated from Middlebury College (full confession: I am a member of Gen Z, not the millennial cohort). As an employed recent graduate, I feel very fortunate. But I can't say the same for many of my friends. Much of the tried-and-true advice for job seekers no longer applies. You can't, for example, stack your calendar with networking coffee chats and obey social distancing guidelines at the same time.
Hone your strategy. Though unemployment is high across the board, people age 18 to 34 have been disproportionately affected, according to a recent Axios-Harris study. One-third of people who are 18 to 34 have been laid off or placed on temporary leave, compared with 22% of those who are 35 to 49, and 15% of those who are 50 to 64, according to the study. But even in this environment, many companies still need employees, and firms are eager to hire recent college graduates. Even if you're unable (or unwilling) to travel, keep an eye out for virtual networking events and remote job postings. "We have definitely seen an increase in remote postings as well as remote events," says Christine Cruzvergara, vice president of higher education at Handshake, an online platform that connects recent graduates with employers.
Steer
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Jul 02, 2020
Not all that long ago, the only major decision the Federal Reserve Board had to make was where to set short-term interest rates. But in the past decade, the Fed has become increasingly aggressive in its efforts to pump up the economy—and there's no sign it will slow down anytime soon. Whether you're a borrower, saver or investor, this matters to you.
Interest Rates at Zero
Some history: As the economy cratered in 2008, the Fed made the unprecedented move of purchasing large sums of Treasury bonds and mortgage-backed securities, which pumped an extra $1 trillion into the economy. Over the course of the next 10 years, it purchased an additional $2.5 trillion. Then, when the coronavirus crisis hit, the Fed purchased another $3 trillion in bonds and securities, bringing its liabilities so far to a record $7.2 trillion. (The total size of the U.S. economy is currently $21.5 trillion.)
And the Fed isn't done. It now has the authority to support up to $2.6 trillion in new lending, which includes making loans to businesses through its Main Street Lending Facility and lending to city, county and state governments through its Municipal Liquidity Facility. The Fed is also backing loans issued through the Paycheck Protection Program, a federal loan-forgiveness program designed to help small businesses survive the coronavirus pandemic.
As for interest rates, it's likely they will remain low for a very long time in order to encourage borrowing and keep the money flowing. Fed chairman Jerome Powell announced at the June 10 meeting of the Federal Open Market Committee that the coronavirus could continue to have an impact on the economy for the next two years and that the Fed isn't likely to raise interest rates until 2023 at the earliest.
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Jul 02, 2020
Choosing a place to spend your retirement years has never been easy, but these days, it's particularly challenging. The coronavirus pandemic has caused some retirees to rethink plans to move to urban or suburban walkable communities. But rural communities, while offering plenty of opportunities for social distancing, may not offer adequate health care—which is a priority for many retirees, particularly while COVID-19 infection rates are still high.
Some of these concerns could dissipate after a vaccine becomes widely available. But in the interim, it's a good idea to reevaluate plans to move—especially if you are considering relocating to an urban area, says Bert Sperling, founder of Best Places, which ranks cities around the country on a variety of factors. "One of the reasons people are moving to those places is their vibrancy," he says. "If the restaurants are going away, if it's difficult to go to shows and museums, then what is the point?"
That doesn't mean it's too early to start thinking about where you'd like to retire, and, once you feel comfortable traveling, you'll probably want to test-drive some destinations. We've selected seven cities that offer a combination of good health care, low density, a modest cost of living and low to moderate taxes. For example, the cost of living in Pensacola, Fla., is below the national average and there are three top-rated hospitals within an hour's drive or less. The beach is lovely, too.
Your own decision will be based on personal preferences, including the type of climate you favor, nearness to family and even your political views. But as you conduct your search, some factors should be at the top of your list, because they'll continue to play an important role in your retirement lifestyle long after the coronavirus threat has diminished.
Health care. The rapid growth of telehealth means you may be able to consul
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Jul 02, 2020
Dayna Ford is senior director-analyst for Gartner, a market research firm. She focuses on digital wallets and other forms of electronic payment.
Electronic payments have soared since the pandemic began. Do you expect that trend to continue after the crisis is over? I do, though the trend toward digital payments due to the pandemic has taken different forms: shopping online, paying digitally while doing a physical pickup or using contactless methods of payment, such as digital wallets. All were existing trends that had been steadily climbing over the past couple of years but have accelerated since the pandemic began. After the crisis is over, the rate of digital payments will drop, but not to what it was before.
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Apple, Google and other providers offer apps designed to eliminate the physical wallet in favor of a digital one, but they're not widely used. Do you think they'll become more popular now? In places such as Asia, the use of digital wallets is very pervasive. A key reason we don't have more adoption here is consumer inertia. Consumers in the U.S. and Europe are accustomed to using plastic credit and debit cards. But concerns about health and hygiene could get consumers to try digital wallets. Once they try them, some will continue to use them.
What about contactless, peer-to-peer payment systems? We will continue to see the growth of peer-to-peer systems such as Venmo. You also have programs such as Zelle, which caters more to consumers who use traditional banks. The pandemic adds momentum because some consumers don't want to touch cash. Concerns about hygiene will get some people over the inertia that prevented them from trying these systems.
How can con
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Jul 02, 2020
This isn't about you, Northern Virginia. On second thought, maybe it is. We must be going. Not right now, but when we retire.
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My wife and I have found a lot to like about our bedroom community near Washington, D.C. Access to the best of the arts, the soulful vibe of the city, professional sports and the historical sites make my heart sing. Point the car west and we can be in the foothills of the Blue Ridge mountains in 45 minutes, or on Skyline Drive in Shenandoah National Park in not much longer.
But as we approach retirement, we have to look at whether it makes financial or lifestyle sense to continue living in busy Northern Virginia after we retire. For us, it just doesn't. In pre-pandemic times, traffic was always nightmarish—and, due to construction of even more federal government buildings a mile from our house, it was getting worse. Plus, the cost of living here is high.
After I mentioned in an earlier column about our plans to leave this area in retirement, reader Denis Symes of Fort Collins, Colo., warned me that I might regret it. He and his wife retired and moved from Northern Virginia to Fort Collins to be close to grandchildren. "We've never lived in a small rural town before and deeply miss Virginia and the cultural attractions in the D.C. area," Symes wrote. "Yes, the cost of living and housing are much less, but the absence of a metropolitan area is deeply missed; lower costs don't make up for this. I've met other retirees here who feel the same way."
We've been scouting potential retirement regions for a few years, and we're keeping metro access top of mind. Two areas are making the cut: the Shenandoah Valley of Virginia (close to D.C. but worlds away) and
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Jul 02, 2020
After the stock market began its plunge in mid-March, investors hurried to find out if their portfolios could withstand the steep drop and what to do next. Now, several weeks later, we've all exhaled as the market has gradually recovered.
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Fortunately, this scenario may benefit many investors, presenting them with a golden opportunity to re-allocate their portfolios to match their risk tolerance. This is particularly true for those who gradually increased their allocation to equities in recent years and then saw their portfolios collapse in March. Now, with the Standard & Poor's 500 index only off 8.4% from its all-time highs as of June 30, it's time for all investors to examine their tolerance for risk without having an uncomfortable discussion as the market is plummeting.
Historical Figures Reveal a Surprising Sweet Spot
This opportunity exists even as some investors wonder if they should double down on the markets' recovery. They are concerned if they don't have enough stocks in their portfolio, or the right stocks, they will miss out if the market races to a new record in the next 12 months.
But history shows us there is a "sweet spot" in any portfolio when we consider the trade-off between risk and reward. It may seem hard to believe, but it tends to be a portfolio that consists of between 50% and 60% stocks.
As an investor's portfolio takes on more risk, with stocks making up 70%, 80% or more, returns can certainly increase as the market moves higher. But because their portfolio becomes less and le
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Jul 02, 2020
Traders will enjoy a long holiday weekend away from their desks. That's because the stock market is closed Friday, July 3, in observation of Independence Day; the fourth of July falls on a Saturday this year.
Bond traders not only get all of Friday off, but the bond markets will shut down early on Thursday, July 2, closing up shop at 2 p.m.
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Regular trading hours for both the stock market and the bond market resume on Monday, July 6.
The following is a schedule of all stock market and bond market holidays for 2020. Please note that regular trading hours for the New York Stock Exchange (NYSE) and Nasdaq Stock Market are 9:30 a.m. to 4 p.m. Eastern on weekdays. The stock markets close at 1 p.m. on early-closure days; bond markets close early at 2 p.m.
2020 Market Holidays
DateHoliday
NYSE
Nasdaq
Bond Markets
Wednesday, Jan. 1
New Year's Day
Closed
Closed
Closed
Monday, Jan. 20
Martin Luther King Jr. Day
Closed
Closed
Closed
Monday, Feb. 17
Presidents' Day/Washington's Birthday
Closed
Closed
Closed
Thursday, April 9
Maundy Thursday
Open
Open
Early close
(2 p.m.)
Friday, April 10
Good Friday
Closed
Closed
Closed
Friday, May 22
Friday Before Memorial Day
Open
Open
Early close
(2 p.
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Jul 02, 2020
China has faced daunting challenges this year. Hong Kong erupted in political protests, COVID-19 got its start in Wuhan, relations with the U.S. deteriorated sharply, and the economy shrank 6.8% in the first quarter, nearly two points worse than the rate of decline in America. In fact, for Chinese stocks, it has been a rough five years, with the MSCI China index returning just 2.5% annualized, compared with 8.6% for MSCI's USA index. (Prices, returns and other data are as of June 12.)
The 10 Best Chinese Stocks You Can Buy
Still, I like China as a long-term investment for a lot of reasons. The most obvious is that, despite threats from the U.S., China is too big for America to do without. China has four times the population of the U.S. and two-thirds of the gross domestic product, with the economic gap closing rapidly. Even with COVID, Chinese GDP is expected to grow by 1% this year, easily the best performance among major countries, according to projections by the Economist Intelligence Unit, a division of the Economist Group media company. The estimate for Europe is a decline of 8.0%; Kiplinger currently projects U.S. GDP to shrink by 5.7%.
China's markets have also matured, and volatility has dramatically declined. The Shanghai Stock Exchange 50, an index composed of the "A" shares (that is, shares that can be traded only by Chinese citizens and large foreign institutions) of 50 large and representative Chinese companies, dropped just 16% from the start of 2020 through its low on March 23. That compares with a loss of 35% over the same period for the Dow Jones industrial average, its U.S. analogue.
Best of all, Chinese stocks are relatively cheap. At this unusual time of business disruption and high unemployment, traditional valuation meas
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Jul 01, 2020
Stocks have rallied so sharply in the past few months that it prompts a question: Are we in a new bull market? With the S&P 500 index up 36% since its March 23 low through mid June, the answer seems an obvious yes. And yet, plenty of veteran Wall Streeters say the bull isn't official yet, and we've seen some cracks in the rally.
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Conventional wisdom says stocks are in a bull market once they're up at least 20% from the market's low. (A bear market is typically thought of as a 20% drop from the high.) But given that bear markets are often punctuated by powerful rallies that ultimately fade, it's important to add a time element to a bull-market assessment. Sam Stovall, the chief investment strategist at investment research firm CFRA, defines a bull market as a gain of at least 20% plus a span of six months without the market undercutting its prior low.
Official or not, however, Stovall is a bull. CFRA's 12-month target for the S&P 500 is 3435, 13% higher than its June 12 close. "I think the March 23 low will eventually be regarded as the start of the new bull market," says Stovall. "The reason for my optimism is the massive amount of stimulus" injected into the market and the economy by the Federal Reserve and Congress. CFRA is most bullish on the communication services, health care and information technology sectors.
Doug Ramsey, chief investment officer and portfolio manager at the Leuthold Group, remains dubious. "The current rally is either the first up-leg of a new
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Jul 01, 2020
Stocks struggled for direction on the first trading day of the second half, as promising news about a possible COVID-19 vaccine and better economic data were tempered by a drop in energy stocks.
A reading that showed U.S. manufacturing activity hit its highest level in more than a year helped bullish sentiment, as did an announcement that Pfizer's (PFE, 3.2%) coronavirus vaccine under development was found to be well tolerated in early-stage human trials.
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In a countervailing trade, energy stocks declined amid fears that the U.S. could see a return to widespread lockdowns to slow the spread of COVID-19.
Strength in the technology sector kept the Nasdaq aloft. Amazon (AMZN, 4.4%) and Facebook (FB, 4.6%) in specific gave the tech-heavy composite enough oomph to gain 1.0% to a record-high 10,154. The S&P 500 finished 0.5% higher to 3,115, while the Dow closed Wednesday down 0.3% to 25,734. The small-cap Russell 2000 lagged them all, dropping 1.0% to end at 1,427.
While fears of shutdowns dragged down economically sensitive small caps and the energy sector, Brad McMillan, Chief Investment Officer for Commonwealth Financial Network, offers up some optimism for investors in his midyear outlook:
"The real question about the coronavirus for the rest of 2020 is not if there will be a second wave, but whether it will be large enough to derail the economic recovery underway," he writes. "So far, it does not look like it will. As of late Jun
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Jul 01, 2020
Many businesses have taken at least a short-term hit from the COVID-19 economic shutdown, but a few fortuitously positioned companies have actually thrived. And arguably the biggest winners have been so-called work-from-home, or WFH, stocks.
Many tech companies in industries such as video conferencing and cloud storage have seen their shares easily beat the market through 2020's first half, in some cases doubling and even tripling. These companies were already enjoying stepped-up investments in software and services that enable remote work, but the COVID-19 pandemic took that shift into overdrive.
Many experts believe work-from-home is a trend with legs. What began as a temporary way to keep employees safe is becoming a permanent movement for large companies including Facebook, Nationwide, Mondelez and Barclays, who see remote work as a way to reduce office rents and tap a broader talent pool. According to a Gartner Group survey, 75% of companies plan to let more employees work remotely. Employees are embracing this trend too; a Gallup poll shows 60% want to continue working remotely after restrictions end.
Here are 17 work-from-home stocks to buy that are at the epicenter of this phenomenon. Each of these provides a way to leverage this trend well into the future - including one play that lets you invest across dozens of WFH stocks at once.
Data is as of June 30.
20 Best Stocks to Buy for the Next Bull Market
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Jul 01, 2020
Video games aren't just games. They are also TV content, judging by the millions of people who watched some 1.75 billion hours of streamed video-gaming programming on Twitch, the live-stream platform for gamers, just in May alone. They're live events, too, with thousands of people showing up to watch top-level gamers face off in e-sports arenas. That makes video games big, big business. Consultant Research and Markets forecasts that the global video-game market will increase revenues at a 6.4% annualized rate between 2019 and 2024, when it will hit $179.1 billion in sales.
Work From Home ETF (WFH) Launches: What You Need to Know
Global X Video Games & Esports ETF is one of a handful of funds that allow investors to cash in on that growth. HERO sports a tight portfolio of 40 firms involved in developing, publishing, distributing or streaming video games, producing related hardware, or operating e-sports leagues or teams. The fund weights holdings by market value, so the larger the stock, the more HERO invests in it. Gaming is global, and so is HERO; it has 71% of assets invested outside of the U.S.
The ETF will only invest in companies that derive at least 50% of their revenues from video game-related businesses. That means you won't see tech conglomerates such as Sony and Microsoft in the fund. You will see graphics chipmaker Nvidia, whose products power high-end gaming rigs; Chinese internet and video gaming company NetEase; and familiar Japanese powerhouse Nintendo. "If it's a leading company in the theme, we want to own that company," says Pedro Palandrani, research analyst at Global X ETFs.
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Jul 01, 2020
None of the members of the Kiplinger Dividend 15—the list of our favorite dividend-paying stocks—has cut or suspended its dividend this year. In most years, that wouldn't be news. But in response to the pandemic, more than 60 firms in the S&P 500 index have battened down the financial hatches by slashing or eliminating their payout. The Dividend 15 yield 3.4%, on average, well above the 1.9% yield of the S&P 500 and the paltry 0.7% from 10-year Treasury notes. (Prices, returns, yields and other data are as of June 12.)
21 Dividend Increases Announced During the COVID Crisis
Stocks on our list, like the broad market, tumbled in February, then rallied mostly back. In 2020, our picks have lost 6.5%, on average, compared with a 5.0% loss in the S&P 500. But amid plummeting fuel demand and sagging oil prices, energy stocks in the S&P 500 have surrendered an average of 32% in 2020. Among our energy picks, Enterprise Products Partners (symbol EPD) lost 29.7% and ExxonMobil (XOM), 30.1%.
Enterprise Products Partners charges other energy firms to transport and store oil, natural gas and other petrochemicals using its network of pipelines and oil facilities. Slowdowns in exploration and production have dinged profits. But Enterprise enjoys a diverse array of high-quality clients and produces ample cash to fund its payout. The firm pays 66% of excess cash as a distribution, well below the 90% threshold that would be concerning for a master limited partnership, says Brian Bollinger, president of research firm Simply Safe Dividends. It stays on our list.
But Exxon comes off. Oil prices h
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Jul 01, 2020
The pandemic has put the health care industry under a global spotlight. Biotechnology and big pharmaceutical firms are front and center as the world races toward a vaccine for COVID-19. There may be many winners, and there may be a few losers, but the current crisis has reminded the world that we are living in a new age of science.
Cures for chronic infectious diseases, targeted cancer therapies and gene editing are just a few of the breakthroughs made in the past decade. And more discoveries are coming. "The speed of science is increasing," says Joshua Riegelhaupt, assistant manager of Baron Health Care fund. "That's why we think this is the century of biology," he says.
These developments are improving the standard of care, says Julia Angliss, an investment manager with a specialty in health care at investment firm Baillie Gifford. "We understand more what drives diseases, and we're able to develop drugs that are more precise, more efficient and more effective," she says. The investing landscape is changing, too. Many health care stocks that were once considered defensive, nest-egg investments have morphed into growth stocks. Investors can bank on more change. We are in "the early innings of transformative global change due to innovation in health care," says Riegelhaupt.
With that in mind, we set out to find stocks poised to follow new approaches in health care that can save costs and improve outcomes.
Stock prices and other data are through June 12.
10 Health and Pharmaceutical Companies Fighting the COVID-19 Coronavirus
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Jul 01, 2020
In February, the U.S. State Department issued a Global Level 4 Health Advisory—its most dire warning—that it summarized in three words: "Do Not Travel." Passing through Transportation Security Administration checkpoints a day later were 146,348 fliers, 93% fewer than the same date a year earlier.
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The coronavirus has grounded even the most avid travelers this year. In a survey by market research firm Longwoods International, 67% said the pandemic had affected their travel plans for the next six months.
So what's a globe-trotting, nature-loving, house-bound culture vulture to do? Plenty. You can still visit museums and marvel at their great works of art, tour historical landmarks and stroll through foreign cities. And you can do it all from home as a virtual sightseer because these sights can be toured online for free.
Fine Art. If you like fine art, for example, you will love Google Arts and Culture. The website, which the Paris-based Google Cultural Institute launched in 2011, has organized more than 3,000 professio
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Jul 01, 2020
In 1995, Bill and Sandy met with me to discuss what to do with a real estate investment that had appreciated significantly. The investment represented a meaningful portion of their net worth, and they felt the time was right to sell. However, they didn't necessarily need a large infusion of cash and they didn't want to pay the tax (in 1995, the capital gain rate was 29%).
High-Level Strategies to Protect Your Wealth from the Wolf at the Door
What Bill and Sandy really needed at that time was income. They had two active teenagers and were paying for private school, travel soccer, spring break trips, and summer excursions abroad. They also had a large home to keep up with and needed to keep everyone entertained.
A CRT Was a Good Choice at the Time
It seemed that at this time a charitable remainder trust (CRT) would be their best option. While there are many versions of the CRT, simply stated, the taxpayer establishes a trust in which the taxpayer is the income beneficiary and at death, the remainder of the assets in the trust pass to one or more named charities. The CRT is established before the asset is sold, the asset is contributed to the trust, and on sale, no federal or state tax is due on the gain. The taxpayer will receive a charitable income tax deduction on the present value of the future income stream, which can be used to offset some or all of the income tax liability. Thus the CRT would enable Bill and Sandy to put their real estate in the CRT, then sell it, and defer the related capital gain, garner an immediate charitable deduction, and collect income from the trust moving forward.
The CRT worked masterfully for years. They enjoyed the income st
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Jul 01, 2020
"I can't afford it." Whenever I hear a young person utter those words, it's music to my ears.
Hey Parents: Financial 'Adulting' Tips for Your Kids
No, I'm not a middle-aged ogre delighting in the social setbacks of the young. I'm a fan of the young people out there who are learning to turn down things they cannot afford, like the friend who says no to a night out for dinner and drinks with their buddies. These young people are making several important financial decisions: prioritizing their spending, making a sacrifice and standing up to peer pressure. These are all important skills they'll need on the road to financial responsibility.
Many young people never learn these important skills because their parents have never taught them. Somewhere along the way, it became unfashionable to have realistic financial conversations with our children. The thought never occurs to many people that they could simply tell their children, "We can't afford it." Those simple words are the foundation for establishing strong financial habits.
If you want your kids to be fiscally responsible (for their sake as well as yours), rethink how you handle certain life milestones.
Mistake No. 1: Leaving the college decision-making process to 17-year-olds
Americans have lost all sense of value when it comes to college selection. Most parents feel obliged to send their children to the best — and often the most expensive — school they can get into. We are leaving large financial decisions that will impact the whole family up to our 17-year-old children.
We don't let
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Jul 01, 2020
A record 39 million Americans have filed for unemployment benefits since March as a result of the economic crisis stemming from the coronavirus pandemic. The total number is staggering, particularly when you consider the impact a sudden job loss has on the lives and families of those who've been let go.
Are You Spending More Than Necessary? 5 Places to Shave Monthly Costs
If you're among those who have been laid off, you may be feeling overwhelmed and anxious about your financial stability. That's understandable, but don't let panic or fear guide your reactions. Now is the time to take stock of your situation and control what you can. Here are five tips to help you manage your finances during this difficult time and establish good habits that can serve you well into the future.
1. Manage your expenses
After a job loss, re-evaluate your monthly spending and look for ways to reduce your expenses. Consider cutting discretionary services that you can handle yourself, such as house cleaning, landscaping or other household tasks that you've previously hired others to do.
Also, use the opportunity to reach out to your service providers of essential items — like internet, phone service and insurance coverage — and see if you can trim back these expenses. Now would be a good time to negotiate a lower rate, especially if you haven't done so in some time. This move can reduce your expenses without sacrificing important things.
2. Obtain health care
As the global health crisis evolves, now is not the time to be without health insurance. If your employer provided you with a severance package, check the detai
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Jun 30, 2020
It's difficult to cast these past three months in a positive light given the fallout of the COVID-19 pandemic, but, for the stock market, Q2 was in fact a quarter to remember.
A day of gains for tech- and tech-adjacent sectors led the major blue-chip indices to higher ground, capping their best quarterly performances in years.
Millionaires in America 2020: All 50 States Ranked
Tuesday's gains came on little to crow about, mind you.
Joint testimony from Treasury Secretary Steve Mnuchin and Federal Reserve Chair Jerome Powell painted a mixed picture of America's economic recuperation. And Dr. Anthony Fauci, the nation's leading infectious-diseases expert, said America's daily coronavirus caseload could hit 100,000 if current trends continue, warning that America isn't "in total control" of the pandemic.
The tech-heavy Nasdaq, led by the likes of Amazon.com (AMZN, 2.9%) and Nvidia (NVDA, 3.2%), still pushed 1.9% higher to 10,058, capping a 30.6% three-month gain that marked its most productive quarter since 2001.
The Dow, which closed with a 0.9% gain to 25,812, enjoyed its best quarter since 1987 with a 17.8% rally. And the S&P 500, up 1.5% to 3,100, posted a 20.0% quarterly return for its best Q2 since the index's inception in 1957. The small-cap Russell 2000 climbed 1.4% to 1,441, its best quarter since 1991.
What's in Store for Stocks in Q3?
Mercifully, investors will get a day off early in the quarter. The stock and bond markets will be closed Friday in o
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Jun 30, 2020
Cheap stocks are effectively Wall Street's casino. It's OK to play them for fun once in a while - just don't make a habit of it.
Stocks come in all shapes, sizes and prices. Right now, some of the largest companies on earth include Amazon.com (AMZN) and Google parent Alphabet (GOOGL), both of which trade at four-figure prices. While nominal prices broadly don't mean much - a company with a $50 stock might be every bit as solid as a company with a $250 stock - these firms' outsize stock prices (and more importantly, their roughly trillion-dollar market values) reflect a long track record of success, not to mention extremely stable financial positions.
On the other end of the spectrum are small caps and even micro-caps: typically cheap stocks that trade for such low prices for a reason.
Investors often gravitate toward cheap stocks in part because of the psychological appeal of being able to buy many shares for a small dollar cost. Also, these stocks are often subject to bigger price swings, making it seemingly easier to reap big gains in a short time.
But institutional investors often do the opposite. Sometimes they bow out once a stock dips below $10, and more will exit once share prices dive below $5. That's because while nominal prices typically don't matter, when they're low enough, they reflect higher risk. Some stocks trading in single digits are in long-term decline. Very low stock prices often reflect smaller market values, and lower-value companies are more susceptible to "pump and dump" schemes. Also, the major exchanges have a $1-per-share minimum trading threshold - stocks that trade under this for long enough risk being delisted.
Even good cheap stocks to buy carry significant risks, such as high debt loads or narr
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Jun 30, 2020
The IRS has some bad news if you were hoping for more time to file your tax return. Due to COVID-19, the original due date for filing 2019 returns was already postponed from April 15 to July 15, 2020. However, several groups were pressuring the IRS to allow even more time to file returns and pay taxes this year. But the IRS shot down that idea and announced that there will not be another delay. So, you still only have until July 15 to get your taxes done and pay any tax due.
If you can't meet the July 15 deadline for whatever reason, you can request an automatic extension of time to file until October 15 by filing Form 4868 by July 15. While this will give you more time to file your return, it does not give you more time to pay any tax due. You still have to estimate your tax liability on the extension form and pay any amount due by July 15 to avoid penalties and interest.
What Are the Income Tax Brackets for 2020 vs. 2019?
You can also get an extension by paying all or part of the tax you owe using Direct Pay, the Electronic Federal Tax Payment System (EFTPS), or a credit or debit card. Make sure you indicate that the payment is for an extension. When getting an extension by making a payment, you don't have to file a separate extension form and will receive a confirmation number fo
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Jun 30, 2020
There's a lot of uncertainty about who will win the presidential and congressional elections in November.
14 Social Security Tasks You Can Do Online
Just what the results will mean for individual finances and investments is really anyone's guess, but many of us are thinking about it. In fact, 72% of Americans believe whoever is elected to the White House will directly impact their personal finances, according to a survey released by personal finance website FinanceBuzz in January, and 32% are putting off a big financial decision until Election Day.
We can't predict the future, but just what can — or should — we do to mitigate concerns about how the election will impact our finances? There are a few things to keep in mind:
1. Stay in control
You're the commander-in-chief of your finances regardless of who's in the White House, so it's crucial to focus on what you can control rather than what politicians or pundits say will happen. That includes determining your savings rate, your discretionary spending, your asset allocation and your estate planning. While markets could be volatile, being proactive about identifying your financial goals and how to achieve them can help you ride out storms. Your objectives come first.
2. Avoid being reactive
One of the surest ways to hinder your financial plan is to make knee-jerk reactions that cost you money. Bailing out of investments at the height of the COVID-19 crisis, for example, costs investors billions of dollars in savings. But equally damaging can be paralysis by analysis—overanalyzing a situation to the point where investors struck by fear are moved to inaction.
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Jun 30, 2020
"Nick" is a recent graduate Palmer College of Chiropractic in Davenport, Iowa, who returned to his hometown in Southern California, opening an office.
To Succeed, Small-Business Owners Need to Put Their Own Finances First
"After I hung out my shingle, it was clear that I needed to attract a patient base — preferably personal injury, auto accident victims as that's where the money is and why I am calling you. Can we discuss my how-to-get-business plan?"
I have always had a great relationship with chiropractors and was happy to help, as Nick needed my advice more than he could ever realize.
The Pay-to-Play Business Plan
"I have friends — such as ambulance drivers, EMTs, E.R. nurses, police officers and lawyers — who come in contact with auto accident victims. My idea is to give them my business cards and encourage handing them out to these people, telling them that I will help them get better, and a nice insurance settlement.
"Naturally, I will pay very well for these referrals, either per referral or a commission — a percentage of fees I earn on the case. Or, if they did not want to be paid, I could arrange for a great weekend in Las Vegas, a dinner at a nice restaurant, just ways of showing my appreciation for their help.
"Does this make sense?" he asked.
On the Surface it Makes Sense, But ...
"Most people, looking at Nick's business plan would say, ‘Yeah, that seems reasonable. People refer cases to him, and he gives them a little s
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Jun 30, 2020
Saving money on a used car is about more than spending as little as possible on the car itself. You want to get a good deal, and that means getting the right car that meets (and will continue to meet) your needs.
Those needs vary as much as individuals (and cars!), so we're not wading into which used car to buy, but, rather, tips and techniques that can help you save money when shopping for a used car.
The Safest Cars for $30,000 or Less
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Jun 29, 2020
Ryan Ermey: Whether you're looking for higher interest rates, lower fees or just don't feel like going into a branch these days, don't even consider shopping for a new bank account before listening to this show. Kiplinger's contributing editor Lisa Gerstner rejoins the podcast to break down the best of big banks, online banks, credit unions and more in our main segment. On today's show, Sandy and I chat about news surrounding RMDs and answer a question about 403(b) plans from our listener mailbag. That's all ahead on this episode of Your Money's Worth. Stick around.
Episode Length: 00:27:03Listen to previous Your Money's Worth episodes
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Ryan Ermey: Welcome to Your Money's Worth. I'm Kiplinger's associate editor Ryan Ermey and joined -- from on the road -- by senior editor Sandy Block. Sandy, how are you?
Sandy Block: That's right. I'm in West Virginia. And if you hear dogs barking, I apologize in advance.
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Jun 29, 2020
The market made a clean shot higher on Monday as investors' eyes yet again were diverted from COVID-19 data and toward encouraging economic figures.
The weekend saw continued growth in coronavirus cases across more than a dozen "hot spot" states, prompting governors to consider further actions to slow the spread. New Jersey announced it would not reopen indoor dining this week; New York appears to be considering following suit.
19 of the Best Stocks You've Never Heard Of
Investors, however, appeared to focus on the real estate market. The National Association of Realtors said May's pending home sales, while off 5.1% year-over-year, surged 44.3% from April's figures - almost triple the improvement economists expected.
The Dow climbed 2.3% to 25,595, led by a massive 14.3% surge in Boeing (BA), which received a Federal Aviation Administration green light to begin test flights on its troubled 737 Max aircraft. The Nasdaq improved 1.2% to 9,874.15, the S&P 500 climbed 1.5% to 3,053, and the small-cap Russell 2000 stole the show with a 3.1% jump to 1,421.
Yet again, investors have plenty to chew on.
"The market is likely to remain in a period of consolidation marked by increased volatility as it digests the historic gains off the COVID-19 low, grapples with the impact of a re-acceleration in cases of coronavirus, anticipates the impact of the coming election, and works through a historic shutdown and reopening of economic activity," writes Canaccord Genuity equity strategist Tony Dwyer, who raised his S&P 500 target to above 3,300 over the next 12 to 18 months. "We have never had the combination of such low core inflation coupled with an unlimited support from the Fed, which is why we use a
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Jun 29, 2020
Dividend increases, in normal times, are a commonplace occurrence that you can read about by the dozens every week.
But these aren't normal times.
The COVID-19 pandemic and related shutdowns have forced many businesses into survival mode, looking for ways for to preserve cash and ride out the economic storm. In fact, during the month of April, S&P 500 components announced more dividend cuts and suspensions than they did dividend increases. Smaller companies outside the blue-chip index suffered the same fate, with dozens reducing or eliminating their payout programs altogether.
But if dividend hikes are a sign of fiscal strength during normal times, they're a downright bold statement when they're made in the middle of a recession. And some companies have indeed provided payout growth throughout the past couple of months - many of them with longstanding streaks, including several members of the S&P Dividend Aristocrats that have improved their dividends for at least 25 consecutive years.
Here are 21 stocks that have announced dividend increases during the COVID-19 crisis so far.
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Jun 29, 2020
As the U.S. entered this recession, the unemployment rate hit a record high. Workers have been laid off or furloughed as businesses closed due to the coronavirus. With payrolls down, the benefits that Social Security offers could be more important than ever to a growing number of people near retirement whose incomes are being impacted.
How to Calculate the Break-Even Age for Taking Social Security
It's impossible to know exactly how this recession will impact our economy long term, but we do know it might be impacting how retirees strategize their benefits. Depending on your unique situation, you might find yourself turning to one of these claiming strategies:
Enrolling in Benefits Early
If you're 62 or older and faced with an unexpected job loss, you need to figure out if you will retire early or look for another job. Will you start taking Social Security, or will you tap into your retirement savings for income?
If you do decide to start taking Social Security early, you need to understand that your benefit will be permanently reduced if you claim before your full retirement age, which is somewhere between 66 and 67. For those who turn 62 in 2020, full retirement age is 66 and 8 months.
Because of the permanent reduction in benefits, we usually recommend waiting to claim Social Security until full
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Jun 29, 2020
Maria Seltzer used to drive downtown from the eastern part of San Diego County to the theater. Then she began driving instead to a nearby Metropolitan Transit System trolley stop, where she could park her car for free and ride about an hour into the city. "I like musicals," Seltzer says. "If it's a musical, I'm in."
50 Best Places to Retire in the U.S.
Though Seltzer, 79, still drives, getting to the theater and ballet was becoming more difficult, especially competing for a parking spot downtown. "I was glad I could find a different way to get there," she says.
In the midst of a deadly pandemic, it may be hard to imagine a time when riding mass transit or getting into a city cab will be perfectly normal things to do for anyone, let alone senior citizens. But eventually, when it becomes safe to do so, life will resume, and for many older adults, who no longer feel comfortable driving, having an alternative mode of transportation may be the difference between independence and social isolation.
According to the American Journal of Public Health, Americans on average outlive their ability to drive safely by 10 years for women and seven years for men. Like Seltzer, three-quarters of Americans age 65 and older live in suburban and rural areas where mass transit options can be minimal, if they exist at all.
Ev
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Jun 29, 2020
Despite all the commercials you see touting the importance of working with a financial planner, most Americans continue to manage their money all by themselves. And the truth is, for a lot of people, DIYing it can work out OK — until they're closing in on retirement, that is, and need specialized help from a professional.
Making the Switch: How to Transition Your Portfolio from Growth to Income
There are certain professions, however, that can (and should) benefit from getting advice sooner rather than later. Pro athletes and celebrities, of course, need assistance as soon as they make it big. But I'm also thinking of well-paid and busy professionals, such as doctors, lawyers and pilots.
If you're a pilot, it may be unusual for you to see yourself grouped in with those other professions. But as a financial adviser whose office is near Chicago's O'Hare Airport, I've learned you may have several of the same issues to deal with, along with other concerns that are unique to your being a pilot. And yet, many pilots are just winging it when it comes to their finances.
Here's why that can be a bad idea:
1. The airline industry is known for boom-bust cycles
Bankruptcies, bailouts, mergers and acquisitions are common in this competitive business and can affect your employment and benefits. So can external economic factors, like the stock market drop in 2008, and unexpected
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Jun 29, 2020
Equity compensation can be an extremely useful tool when it comes to building wealth. And just like any other tool you may use, you can learn how to leverage it to build something great — or you can mishandle it and end up with a poor outcome.
The Coronavirus at Work: Your Legal Questions Answered
Some employers offer equity compensation in addition to regular paychecks or bonuses as part of the total compensation package for key, valuable employees. This is one way companies incentivize top performers to keep performing well, since employees are able to share in the success of the business as a whole. It can also act as a means for the company to retain talent (since most equity comp comes with a vesting schedule, meaning the employee must remain with the company for a set period of time before they can claim the equity they earned).
There are many types of equity compensation that you could receive: Incentive stock options, non-qualified stock options and restricted stock units are some of the most common forms of equity. You might also be able to participate in an ESPP, or employee stock purchase plan, as part of your compensation package.
One of the biggest issues that most people don't take into consideration when they receive some form of equity compensation is concentration risk. Whenever you hold a large amount of a single stock position, you increase your concentration risk and therefore the overall risk inherent in your investment portfolio. This can become especially problematic if you hold a lot of stock from a single company that also happens to pay your salary.
The rule of thumb I provide to my c
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Jun 27, 2020
When you think about shopping at Costco, bulk groceries and household supplies typically come to mind. You don't necessarily think about making a run to the warehouse club if you're looking to buy a designer watch or you need to re-up your stash of high-end skin cream. You could be missing out on huge savings: Costco sells a limited selection of luxury goods at discounted prices, both in-store and online.
We scoured the luxury goods available to members on Costco.com, then compared the warehouse club's price on selected items against the manufacturer's suggested retail price, as well as the price being offered at competitor retailers. Take a look at our surprising list of high-end items that are cheaper at Costco.
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Jun 27, 2020
Sales tax holidays offer a great way to save money on back-to-school supplies, emergency preparedness kits, energy-saving appliance, and even hunting gear. Let's say you live in Norfolk, Va., and you're getting ready for the 2020 hurricane season. You have your eye on a portable home generator that costs $1,000 at the local hardware store. If you buy the generator in June, you'll pay an additional $60 in sales tax. But if you wait until August 7 to 9, when Virginia is having a tax-free weekend, you won't pay any sales tax at all. It's that easy!
Sixteen states have one or more sales tax holidays in 2020. If you plan your shopping around these tax-free periods, you can save big bucks on a wide range of items you're probably going to buy anyway. The dates for these no-tax holidays are scattered throughout the year. However, they typically fall on a weekend, but in some cases go on for an entire week. Here's a peek at the 16 states that offer sales tax holidays, as well as the products that qualify in each state. Unless otherwise noted, the exemptions cover both state and local sales taxes.
The 10 Most Tax-Friendly States in the U.S.
Sales tax rates and averaged combined state and local sales tax rates are from the Tax Foundation as of January 1, 2020
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Jun 26, 2020
The stock market tug-of-war we mentioned on Thursday? Well, the bears bit into the rope and pulled hard on Friday.
The Federal Reserve, following an annual "stress test" that revealed potential capital issues in coronavirus-related scenarios, voted to mandate limiting dividends and stock buybacks at the nation's large banks during the third quarter. "Big Four" banks including Wells Fargo (WFC, -7.4%) and Bank of America (BAC, -6.4%) gave up Thursday's gains and then some.
The 12 Best ETFs to Battle a Bear Market
Meanwhile, the rest of the market finally gave way to COVID-19 concerns that had been mounting all week. Florida contributed nearly 9,000 new cases Thursday to help lift the national single-day caseload to roughly 37,000, topping the previous high set in April by more than 800 infections.
The Dow started off lower and continued to weaken as the day wore on, retreating 2.8% to 25,015.55. The industrial average also was helped lower by Nike (NKE), which plunged 7.6% after reporting that its quarterly revenues plunged 38%.
The Nasdaq pulled back 2.6% to 9,757, the S&P 500 declined 2.4% to 3,009, and the small-cap Russell 2000 took the mildest loss of the major indices, dropping 2.2% to 1,382.
Signal to sell, or a buying opportunity?
The U.S. finds itself at another new coronavirus crossroads. While
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Jun 26, 2020
If you've ever had the chore of going to your closest Social Security office for, say, a name change or a replacement for your ancient (and MIA) Social Security card. . . well, I'm so sorry. The wait was likely interminable and the experience uncomfortable; at least it was for me.
In pre-internet days, you had no choice but to physically go to a Social Security office for many tasks. These days, you can manage your own Social Security profile and execute many critical moves yourself online. (Note: During the COVID-19 emergency, Social Security offices nationwide are staffed but not open for face-to-face services. Call your local office -- they're typically staffed until 4 p.m. weekdays -- if you need help.)
Whether you're a pre-retiree on the cusp of claiming your hard-earned Social Security benefits or a young worker decades away from retirement, you should set up a free MySocialSecurity account. It's a good way to protect against Social Security fraud, and it's a prerequisite for many of the items on our list here.
Once you've set up your MySocialSecurity account, take charge of your Social Security benefits by review
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Jun 26, 2020
2020 has been a brutal year for financial stocks. A drop in interest rates, higher pandemic-related insurance claims and the steep economic downturn have crushed the S&P 500 financials sector by about 25% so far this year.
Of course, anytime there is carnage, there is also opportunity to find bargains. And analysts recently have targeted a few financial stocks to buy for their apparent value.
Most recently, banks were pummeled in the wake of the Federal Reserve placing limits on dividends and share buybacks at the nation's biggest banks. However, that doesn't mean all lenders are down for the count. Similarly, credit-fueled consumer spending remains lively. And it's not like every property & casualty insurer is crying in its beer.
To get a sense of where the bargains might lie, we surveyed the S&P 500 for financial-sector stocks with some of the strongest analyst ratings on the Street, according to S&P Capital IQ.
Here's how it works: S&P Capital IQ surveys analysts' stock calls and scores them on a five-point scale, where 1.0 equals a Strong Buy and 5.0 is a Strong Sell. Any score lower than 2.5 means that analysts, on average, rate the stock as a Buy. Scores of 1.5 and below mean the stock is a Strong Buy. Either way, the closer a stock's score gets to 1.0, the more bullish analysts are about its prospects.
After sorting through the S&P 500, we found stocks ranging from an asset manager to a regional bank to a credit-card issuer. Read on as we look at five of the top-rated financial stocks to buy in these turbulent times.
Share prices, dividend yields, price targets, analysts' ratings and other data are courtesy of S&P Capital IQ as of June 25, unless otherwise noted. Stocks are listed by analysts' average recommendation from worst to best.
Hedge Funds' 25
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Jun 26, 2020
Divorce can be an emotionally and psychologically difficult undertaking. In the midst of such turmoil, it can be tough to focus on the financial impacts of divorce as well, especially for women, who, despite being breadwinners in many U.S. households, often play a less hands-on role when it comes to family finances. But it's incredibly important that financial wellness be an important part of any divorce proceeding and settlement.
How Do You 'Win' at Divorce? Stay Out of Court
Here are seven financial tips for women going through divorce. Though not exclusive, they're starting points that should not be ignored.
1. Be aware of all your assets.
How much in assets do you have? It's a fairly straightforward question, but in a divorce, the picture can get murky. Some of those assets might be jointly held by you and your partner, while others might not even be known to a spouse. But knowing the value of your assets—as well as your spouse's assets and those jointly owned—is essential for an ultimate, fair financial resolution in a divorce. It's important to be sure, before proceedings begin, that you know what all assets are and where they are. Start by gathering all the documents you can. Paperwork like financial statements, tax returns, wills, trusts, retirement account statements, insurance documents and property deeds can help assess assets. If needed, attorneys and financial advisers can help.
2. Don't forget the debt.
Just as assets are shared in a marriage or civil union, so too are many types of debt. In many cases, spouses can be unaware of debts the other spouse might have, and they might not know unti
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Jun 26, 2020
As we enter the fourth month of an ever-evolving reality, we are slowly recognizing that many old norms are being replaced with the need for pragmatism and a levelheaded intellectual approach.
Every day we hear often conflicting information regarding our safety and the battle between economic salvation and the health of society. Even as unemployment reached levels not seen since the Great Depression, the stock market has returned to pre-virus levels . Meanwhile, the talking heads on the stock market TV shows still dole out advice on everything from what stocks are hot or cold to tax and wealth planning ideas, all of which leave the viewer confused and potentially frozen.
Right now, the greatest unknown is where we find ourselves within the progression of this perfect economic storm. Are we at the beginning? The middle? The end? Given this environment I thought it would be worthwhile to provide an analytical framework to approach a few wealth planning concepts that should be reviewed and analyzed based on your personal tax and financial situation.
No one has a crystal ball, but there are variables that may be changing that we should consider from an opportunity perspective:
Income tax rates are at historic lows.Interest rates are at historic lows, including the government sanctioned transactional interest rates, the "Applicable Federal Rates (AFR)" rates, used for many planning strategies.
The estate and gift tax exemption are at historic highs resulting in
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Jun 25, 2020
California, Florida and Texas - America's three most populous states - set new COVID-19 daily case records Wednesday, and Texas temporarily halted its reopening plans. Nevada and Washington state mandated wearing masks in public amid troubling COVID-19 caseloads. Disney (DIS, -0.6%) is delaying the opening of Anaheim's Disneyland, while Apple (AAPL, 1.3%) announced it would re-close more than a dozen retail locations in Florida.
The steady stream of negative coronavirus headlines looked like it would sink stocks early Thursday, but investors eventually found reasons to buy.
Weekly jobless claims were yet again lower, at nearly 1.5 million, and continuing claims were better than expected at 19.5 million. News that banking regulators are going to loosen Volcker Rule restrictions propped up financial stocks such as JPMorgan Chase (JPM, 3.5%) and Bank of America (BAC, 3.8%), and gave the broader markets a little oomph, too.
Work From Home ETF (WFH) Launches: What You Need to Know
A late-day rally drove the Dow, which had declined by as much as 236 points earlier in the day, 299 points higher - a 1.2% gain to 25,745. The S&P 500 finished up 1.1% to 3,083, the tech-heavy Nasdaq gained 1.1% to 10,017, and the small-cap Russell 2000 closed 1.7% higher to 1,413.
Wall Street is caught in a tug-of-war. On the one hand, improving economic data continues to be wind in the bulls' sails. But action in
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Jun 25, 2020
Many investors rely on Vanguard funds to keep their portfolios diversified and their costs low. That's a strategy you can stick with over the long term - even if this year's market roller-coaster ride has made you nervous in the short term.
After a decent start to 2020, the stock market entered bear territory in spring as the severity of the coronavirus pandemic became clear. Wall Street quickly recovered in April, but lately we've seen signs of serious economic distress return - for instance, when the Dow Jones Industrial Average shed 7% in a single session in mid-June with a drop of more than 1,500 points after a gloomy economic outlook from the Federal Reserve.
Will stocks bounce back and rally again in 2020? Perhaps. But one thing remains clear: Over the long term, stocks always trend higher. Bear markets, recessions and even a once-in-a-generation financial crises cannot keep Wall Street down for good. And Vanguard mutual funds and exchange-traded funds allow investors to enjoy in that long-term growth without paying exorbitant fees.
Whether you're convinced stocks will keep powering higher in the near term, or just optimistic the next bull market will arrive soon, here are the 13 best Vanguard funds that can help you make the most of things.
Data is as of June 24.
The 25 Best Low-Fee Mutual Funds to Buy in 2020
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Jun 25, 2020
Buying "work-from-home" stocks just got a lot easier.
Direxion Funds launched the Direxion Work From Home ETF (WFH) on Thursday, providing the market with its first one-stop shop for a trend that has been around for years but been magnified because of the COVID-19 pandemic.
Remote work might just be a months-old concept to many Americans, but this more flexible work style has been on the rise for years. Direxion points out that even in 2017, 43% of employed Americans were spending "at least some time working remotely."
14 Best Tech Stocks That Aren't on Your Radar
However, the coronavirus outbreak has rapidly changed the landscape of working from home. More than half of U.S. companies say they plan on making remote work a permanent option in the wake of COVID-19, and three-quarters of Fortune 500 CEOs say they plan on accelerating their companies' technological transformations.
In other words, the success of tech stocks related to the work-from-home push likely aren't just a flash in the pan.
"We've never faced a global pandemic like this that has impacted countries around the globe," says David Mazza Managing Director, Head of Product, Direxion. "And unlike a natural disaster where we see a swift economic recovery, how we get there this time will require us to change."
The WFH exchange-traded fund is the first such product to give investors pure-play access to this rising trend.
A Look Inside WFH
The Work From Home ETF tracks the Solactive Remote Work Index, which focuses on four technologies crucial to keeping companies o
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Jun 25, 2020
There's no way to sugarcoat it: The seniors leaving campus this spring are graduating into one of the worst job markets in recent memory.
With the unemployment rate expected to exceed 20% in the coming months and the U.S. now officially in the grip of a recession, employers are rescinding job offers, delaying start dates and freezing hiring.
At the same time, COVID-19 is forcing much of the recruitment process to go virtual, upending the career fairs, campus recruitment visits and other services that many students rely on to find their first jobs after graduation.
According to a survey conducted in June by the National Association of Colleges & Employers, 9% of employers are revoking offers to recent college graduates and 33% are delaying start dates. And as of the end May the number of internships on ZipRecruiter was down 31%.
For graduates, then, the message is simple: Be realistic and be ready. The job market will get better, and you should be prepared for when it does. The question you should ask yourself is this: How do I use the next few months to be ready to take advantage of the job market as it comes back to life? Here are s
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Jun 25, 2020
These banks cut fees and load on benefits for customers who keep sizable amounts in deposit and investment accounts. Plus, they offer wealth-management services and access to branches for in-person service.
BEST: Citibank
Why it won: Citi caters to customers who can maintain hefty balances with a compelling premium checking account.Standout account: For those who have at least $200,000 in linked deposit, retirement and investment accounts, the Citigold package tucks in plenty of benefits.
Where it is: Almost 700 branches in 10 states, with core markets of Chicago, Los Angeles, New York City, Miami, San Francisco and Washington, D.C. Plus, Citi has more than 1,800 branches overseas. (Terms and rates are for New York City.)
11 Best Things to Keep in a Safe Deposit Box
The Citigold premium checking package keeps shining, giving Citi a boost to the top of our high-net-worth-families ranking for four years running. Citigold customers get a bountiful assortment of freebies and discounts, including waived fees for standard checks, money orders, incoming wire transfers, stop payments, overdraft transfers and foreign transactions with your debit card. You are reimbursed for all out-of-network ATM fees worldwide and get preferred rates on deposit accounts and loans. (Citigold customers earn a 0.03% rate on checking and up to 0.15% on a savings account, depending on the balance. Citi's top CD rates include 0.45% on a three- or six-month ter
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Jun 25, 2020
These banks offer dedicated accounts for children and teens, plus a host of great accounts for parents, too.
BEST: Capital One 360
Why it won: Parents and their children both benefit from an appealing selection of no-fee, no-minimum accounts. Standout accounts: The free Money Teen Checking account has friendly features for kids age 8 to 17, and the free Kids Savings account offers a 0.5% yield.
Where it is: Accounts are internet-based, but for in-person service, Capital One has more than 450 branches in eight eastern and southern states, plus Washington, D.C.
11 Best Things to Keep in a Safe Deposit Box
The Money Teen Checking account yields 0.1% and offers free access to more than 39,000 ATMs in the Capital One and Allpoint networks. Your kid gets a debit card (check-writing is unavailable), but as a joint owner, you can manage the account and receive alerts for each transaction. Your teen can also check the account balance, deposit checks and set up savings goals. Overdraft services aren't available, so if your child tries to make a debit card purchase with nonsufficient funds, it will generally be rejected (if a transaction causing the account to go negative does make it through, Capital One won't charge interest or a fee). With the Kids Savings Account, children younger than 18 can deposit checks, set savings goals and
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Jun 25, 2020
Low or no minimum account balances, free checks and paper statements, and access to investment and advisory services make these banks attractive for retirees.
BEST: TD Bank
Why it won: TD has a large footprint of branches for in-person service and a strong checking account for those 60 and older.Standout account: 60 Plus Checking folds in features that make sense for retirees.
Where it is: More than 1,200 branches in 15 states (and Washington, D.C.), stretching down the east side of the country from Maine to Florida. (Terms and rates listed here are for customers in Cherry Hill, N.J.)
11 Best Things to Keep in a Safe Deposit Box
With a reasonable balance minimum of $250, you avoid a $10 monthly fee on the 60 Plus Checking account. Standard checks, cashier's checks, money orders and paper statements are free, and as with other TD personal checking accounts, you get a discount of 0.25 percentage point on a TD home equity or personal loan. If you're 62 or older, the Simple Savings account (0.05% yield) and the Growth Money Market (0.01% to 0.15% rate, depending on the balance, if you have a monthly transfer of at least $50 into the account)
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Jun 25, 2020
Credit unions are not-for-profit institutions owned by their members, and the ones listed here offer membership to anyone in the U.S. These credit unions also participate in the CO-OP Shared Branch network, through which customers can get account services at any participating credit union branch.
GOLD: Connexus Credit Union
Why it won: All of Connexus's checking and savings accounts are free, and some of them offer enticing interest rates, too.Standout accounts: Xtraordinary Checking yields 1.75% if you meet certain activity requirements. Among CDs, a one-year certificate yields 1.01%, and a five-year CD has a 1.56% rate.
Where it is: 11 branches in Minnesota, New Hampshire, Ohio and Wisconsin.
11 Best Things to Keep in a Safe Deposit Box
Connexus offers a solid set of free checking accounts. Xtraordinary Checking has a 1.75% rate on balances of up to $25,000 (0.25% on the portion higher than $25,000) and reimburses up to $25 monthly for out-of-network ATM surcharges in the U.S. if you receive electronic statements and either make at least 15 debit card purchases monthly or spend $400 or more each month with your debit card. Have a child between age 10 and 17? Steer him or her to Teen Checking, which earns 2% on a balance of up to $1,000 (0.25% on the portion higher than $1,000). If you want just the essentials, Innova
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Jun 25, 2020
Thanks to smaller overhead costs, banks that operate primarily online usually offer higher interest rates and lower fees than brick-and-mortar institutions. And during a pandemic, their no-touch services are more attractive than ever.
GOLD: Ally Bank
Why it won: Ally provides a simple and attractive lineup of checking and savings options, with no monthly fees and no minimums required to open or maintain the accounts.Standout accounts: Interest Checking offers 0.1% interest on balances of less than $15,000 or 0.5% on $15,000 or more. Online Savings yields 1.1% on all balances.
11 Best Things to Keep in a Safe Deposit Box
Ally Bank is a familiar name in our rankings, topping the list of best internet banks each of the four years we've crowned winners. A consistently strong selection of deposit accounts with minimal fees and decent interest rates pushes Ally to the number-one slot, and the bank makes the most of its online platform.
Earlier this year, Ally introduced digital tools to its Online Savings account that help customers reach their savings goals. With the Buckets feature, you can dedicate funds to different goals—say, with one "bucket" to save for a vacation and another for holiday shopping. The Boosters tool helps you increase savings by arranging automated transfers into the account
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Jun 25, 2020
These big institutions have branches that stretch into various regions of the country, and they offer plenty of online and mobile tools, too. They also provide wealth-management and advisory services.
GOLD: TD Bank
Why it won: Whether you're looking for a basic, low-minimum account or one to suit students, seniors or travelers, TD Bank has you covered. Standout account: Beyond Checking comes with an alluring collection of perks, and it offers three ways to avoid the monthly fee.
Where it is: More than 1,200 branches in 15 states (and Washington, D.C.), stretching down the east side of the country from Maine to Florida. (Terms and rates listed here are for customers in Cherry Hill, N.J.)
Year after year, TD Bank tops our list of the best national banks. Along with a strong selection of deposit accounts, TD offers extra touches that make the banking experience more inviting. Normally, most branches are open on Saturdays and Sundays and into the evening on weekdays, although hours have been reduced because of COVID-19 recently. The free lollipops and pens typically offered in the lobby may not appeal during a pandemic, but branches are putting out hand sanitizer and accommodating social distancing by offering virtual check-ins (allowing customers to wait in their cars until a bank representative is available) and installing plexiglass screens at teller stands and desks.
11 Best Things to Keep in a Safe Deposit Box
With TD's basic
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Jun 25, 2020
If you're in the market for a new bank, your priorities may be shifting as the U.S. faces a recession and grapples with the continuing effects of the coronavirus pandemic. The interest paid on bank accounts has declined sharply since the Federal Reserve slashed short-term rates earlier this year. At the same time, the personal savings rate among consumers hit a record 33% in April, according to the U.S. Bureau of Economic Analysis, and bank deposits are on the rise.
32 Ways to Earn Up to 9% on Your Money Now
Another change: Going to a branch is less than desirable when social distancing is the norm. Branch visits in many areas were down by 30% to 40% this spring, according to research firm Novantas, and many banks closed their lobbies or reduced hours to minimize the spread of COVID-19. Only 45% of customers expect to go back to their regular branch activities after social distancing ends, according to a Novantas survey. As Americans began receiving government stimulus checks in April, new registrations for bank mobile apps increased by about 200%, and bank app usage more than doubled at one point, according to financial-technology company FIS.
Whether you're on the hunt for a higher yield on your checking or savings account, aiming to do more of your banking online, or looking for a bank with branches nearby, you'll likely find an institution to suit your needs among our list of the best banks and credit unions, which we evaluated with the help of Informa Financial Intelligence, a financial research service. All of them offer mobile apps that allow you to deposit checks, review account balances and perform other banking activities on the go, and you can of
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Jun 24, 2020
Stocks tumbled Wednesday, hurt by downbeat economic news and concern over the surge in new coronavirus cases. The U.S. identified more than 35,000 new cases of COVID-19 on Tuesday, the highest single-day total since late April and the third-highest total of the entire pandemic. With new cases rising in more than 20 states, investors are coming to grips with the possibility that parts of the U.S. might need to go back under lockdown. In gloomy economic news, the International Monetary Fund slashed its 2020 global output forecast to -4.9% from -3%. The Dow fell 2.7% to close at 25,445.
Where to Invest Right Now
Wednesday's washout doesn't mean the end is nigh for the current uptrend. Tech stocks, the stars of 2020, held up relatively well Wednesday, with Intel (-1.4%) and Apple (-1.8%) helping to mitigate the Dow's loss. Indeed, it's reasonable to assume that tech stocks, ranging from famous names to under-the-radar firms, will continue to lead the market higher in a post-pandemic world. Between momentum and fundamentals, the tech sector remains the best bet for market leadership, a fact that's not lost on the "smart money." Among hedge funds' favorite stocks, tech claims four of the five top spots. Have a look at all 25 of hedge funds' favorite blue-chip stocks.
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Jun 24, 2020
After being cooped up for months at home, who doesn't want to pack their bags and take a vacation? I certainly could use some time lounging on the beach or hiking up a mountain. And the travel industry wants us all to take a trip somewhere, too. Airlines, hotels, restaurants, and other businesses that rely on vacationers have been in the dumps during the coronavirus pandemic. They're looking for anything that will boost their bottom line.
What Are the Income Tax Brackets for 2020 vs. 2019?
So, how then do you make it easier for Americans to take a vacation and save the travel industry at the same time? How about a tax credit! That's the idea behind a bill introduced in Congress by Sen. Martha McSally (R-AZ). The American Tax Rebate and Incentive Program (TRIP) Act would provide a tax credit of up to $4,000 ($8,000 for married couples filing a joint return), plus an additional $500 for each child age 16 or younger, for your domestic travel expenses.
What Expenses Would Be Eligible for the Credit?
Under the plan, you could claim a tax credit (up to the applicable amount mentioned above) for travel expenses related to:
Food and beverages;Lodging;
Transportation;
Live entertainment (including sporting events); or
Attending a conference or business meeting.
So, your meals and hotel expenses on vacation would be covered. You could even get a credit for your margaritas at the tiki bar. If you fly to your destination, airfare would be counted. If you drive your own car, you could claim the standard mileage rate fo
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Jun 24, 2020
Ryan Ermey: Welcome to Your Money's Worth. I'm Kiplinger's associate editor Ryan Ermey joined from her attic, still I think, by senior editor Sandy Block. Sandy, how are you?
Episode Length: 00:34:01Listen to previous Your Money's Worth episodes
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Sandy Block: Still in the attic in my home office, which we are going to talk about, right?
Ryan Ermey: Yes. We're going to get to that in one second. It is the topic of our first segment, but I always appreciate reader input and we got some good input about our last episode. Some of you may recall that we talked about the rules for giving to charity that have recently changed and that have become more prescient in these times. And a reader, Andy from South Jersey, one of my people, Sandy . . .
Sandy Block: Your peeps!
Ryan Ermey: . . . wrote us in to tell us that across the country, more than 800 local community foundations are philanthropic intermediaries that have deep relationships with the local nonprofit charitable organizations as grantees and capacity builders. And you know, these are a really good way to find good local charities in your area. So he says, for example, "In
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Jun 24, 2020
Seniors got a big break back in March when the Coronavirus Aid, Relief, and Economic Security (CARES) Act nixed required minimum distributions (RMDs) for 2020. But some retirees who took money out of a retirement account before enactment of the CARES Act were stuck and unable to take advantage of the RMD waiver. That's all changed now, though. The IRS issued new guidance expanding the waiver relief and giving retirees more time to undo pre-CARES Act withdrawals.
RMD Waivers for 2020
Generally, once you turn 72 (70½ before 2020), you have to take a certain amount of money out of your traditional IRAs and 401(k) plans each year. These mandatory retirement account withdrawals are called "required minimum distributions" (or RMDs for short).
11 Ways the CARES Act and Other Government Measures Could Help You in 2020
A lot of retirees complain each year about being forced to take RMDs. However, there was even more concern about them this year because of the economic mess we're in right now. Requiring distributions in 2020 would have essentially forced retirees to "sell low" by pulling money out of their retirement account when the stock market is down significantly. So, under the CARES Act, RMDs are waived for 2020. This gives retirees some breathing room and lets them keep money in their retirement accounts a little longer to (hopefully) recover the lost value.
But what about the early birds who already
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Jun 24, 2020
Applying for Social Security Disability Insurance (SSDI) benefits has always been a complicated process. But like everything else in our lives right now, COVID-19 has made it even more difficult.
COVID-19: A Once-in-a-Lifetime Chance to Change Our Spending Habits
With Social Security Administration (SSA) offices closed nationwide, wait times via phone are averaging 90 minutes, and the backlog of people waiting for this critical income is growing by the day.
With that in mind, here are some expert tips to help you best navigate the SSDI benefits process as efficiently and quickly as possible during the pandemic.
1. Don't wait to apply.
The biggest mistake that applicants make when applying for SSDI is waiting to apply. On average, people wait 7.6 months after the onset of a disability to apply for benefits, and considering that more than 2 million people applied for SSDI last year, waiting now could come with serious, time-consuming consequences.
Already, there are nearly 600,000 people waiting for a decision at the initial application level, where it takes four to six months for someone to receive a yes or no. About two-thirds of applicants are denied at the application level, often due to technical errors. This leads to longer waits through the appeals process.
If this happens to you, the good news is that you can appeal for a reconsideration of your claim. The bad news is that a second denial lea
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Jun 23, 2020
I think it's safe to say that 2020 hasn't exactly been what we all expected. Very few of us have been immune to the consequences of the COVID-19 pandemic, and the true economic fallout from the crisis is just beginning to take shape. Our economy has shed more than 30 million jobs since March, and countless businesses — both large and small — have been shuttered.
It has been challenging to say the least — but not all the news has been bad.
The Upside of Down Stock Markets
Across America and around the world, people and communities have come together to support each other and those on the front lines during the pandemic in ways we haven't really seen since 9/11. Drive-by parades celebrate kids' birthdays, New Yorkers join together every night at 7 p.m. to salute health care workers, and actor John Krasinski set up a home studio to bring us Some Good News.
As news of the pandemic continues to shift and America takes its first steps toward "normal," many people are likely contemplating what changes they want to make in their lives going forward — including how they invest. If that is you, now may be as good a time as any to refocus your investment strategy and reflect on how and why you invest.
Putting Faith in Your Portfolio
Throughout this crisis, many have leaned on their faith to calm fears and anxieties — a tactic that's probably been helpful. In fact,
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Jun 23, 2020
Market data overshadowed medical data Tuesday as stocks made their way higher, again on the back of the relentless technology sector.
The preliminary IHS Markit purchasing managers' index reading climbed from 37.0 in May to 46.8 in June - still an indication of contraction in services and manufacturing output, but at a far slower pace. And May new-home sales improved 16.6%, to a 676,000 annual rate, to easily exceed expectations.
19 of the Best Stocks You've Never Heard Of
That overshadowed an increasingly worrisome COVID-19 picture, with 29 states reporting increases in infections. That includes Texas, where Gov. Greg Abbott said yesterday that "additional measures are going to be necessary" if the state doesn't buck its current trend.
Still, the Dow climbed 0.5% to 26,156 thanks to continued help from big-tech stalwarts Apple (AAPL, 2.1%) and Microsoft (MSFT, 0.7%), which both set record highs. The pair also helped the Nasdaq climb 0.7% to 10,131. The S&P 500 finished up 0.4% to 3,131, and the Russell 2000 improved at the same rate, to 1,439.
Apple and Microsoft were hardly alone. Several of the Nasdaq's top stocks notched new all-time highs today as well, including Facebook (FB, 1.3%) and Peloton (
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Jun 23, 2020
Emerging-markets stocks weren't exactly enjoying a good run before the COVID-19 pandemic wrecked the global economy. And months of lockdowns and a massive decline in economic activity certainly haven't helped much.
Apart from lacking adequate health systems, most emerging markets have minimal safety nets, and a large segment of the economy is informal. The can't afford to get sick, and they certainly can't afford to go to work.
Developing economies are more sensitive to commodity prices and trade flows than most of their developed peers, too. So, a major drop in demand from the United States and other importers tends to hit these countries particularly hard.
"While there isn't a single country in the world that has avoided economic upheaval during the COVID-19 pandemic, resource-heavy economies in the Middle East, Asia and Latin America have been hit particularly hard," says Amir Hekmati, fund manager for portfolio consulting firm TradeFlow and a geopolitical risk analyst for the Middle East and North Africa region. "We're only now beginning to see the full extent of the damage showing up in the economic releases."
Emerging-markets stocks have been a graveyard for capital. This isn't a recent phenomenon, either. As Michael Gayed, manager of the ATAC Rotation Fund (ATACX) and editor of the Lead-Lag Report, explains, "By far and away the most frustrating investment thesis of the past decade has been betting on anything but U.S. equities, and particularly positioning long into emerging markets. Cheap valuations simply haven't translated into price momentum."
All the same, emerging-markets stocks have been showing signs of life. Thanks to a 32% run off the March bottom, the iShares MSCI Emerging Markets ETF (EEM) is just 14% away f
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Jun 23, 2020
As I work with several upcoming rookies in this year's NFL, NBA, MLB and NHL drafts, I'm noticing the lack of financial literacy in the professional athlete community - especially rookies. It's insane the trust level they give to agents as well as those in their inner circle.
But it's not an isolated problem. Financial knowledge across the United States is weak overall, and a December 2019 FINRA Foundation "Investors in the United States" report revealed only a third of respondents are able to answer more than half of the 10 investing quiz questions correctly. In addition, 14% of respondents did not think they paid any investment fees. But the most shocking answer by far was that free investor-related tools - such as BrokerCheck and Investor.gov - are used by fewer than 10% of investors!
It seems that the vast majority of investors are unwilling to do due diligence on their financial advisers, failing to examine the individuals who play such an important role in their financial success or destruction.
Due diligence should be done before ever hiring a financial adviser and every year afterward. (Want more information? Sign up for Carlos Dias' free webinar, Deciphering the Types of Financial Advisors, on June 25 at 4 p.m. EDT.) Here's how investors can get started:
Look at your adviser's Form ADV for fees and complaints
Form ADV is a document that investment advisers must fill out for regulators. It comes in two parts - Part 2A and 2B - and can be found on
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Jun 22, 2020
Between the SECURE Act and the CARES Act, the landscape has changed for RMDs this year. You don't need to take one, for instance. And if you already have, you may be able to undo it.
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Jun 22, 2020
Apple (AAPL) climbs after WWDC announcements; Microsoft (MSFT) lends its heft to Monday's effort
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Jun 22, 2020
There's a saying on Wall Street: Don't confuse brains with a bull market.
After all, when most stocks are gaining day after day, it's easy to look smart. Indeed, the market has been in bull mode for so much of the last decade-plus, it's hard to remember what challenging investing looks like.
The S&P 500's longest bull market in history began in March 2009 and ended abruptly in March 2020, clobbered by coronavirus fears. The bear market that followed cut fast and deep, but bottomed out in late March. About a month after its nadir, the market returned to bull-market territory and - so far at least - looks poised to keep chugging along.
Indeed, from March 23 to June 19, the S&P 500 rose a remarkable 40%.
So, justified or not, those of us who have stuck around in stocks are probably feeling pretty brainy these days. Still, there's plenty more to know about bull markets.
Read on to learn 10 things you must know about bull markets.
SEE ALSO: All 30 Dow Stocks Ranked: The Pros Weigh In
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Jun 22, 2020
Stock market volatility like we've been seeing the past few months can bring out the worst in investors. Keep your head and avoid some potentially serious pitfalls with some lessons from behavioral psychology.
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Jun 22, 2020
As the coronavirus pandemic continues to challenge every aspect of our lives - work, family, health and money - it is imperative we all take a gut check on any of our portfolio exposed to the wild rides of the financial markets. A recap is important: According to JP Morgan's Q2 2020 Guide to the Markets, the S&P 500 index hit its last historical high on Feb. 19, 2020. It then promptly plummeted over the next four weeks, dropping 34%. That epic plunge ended the longest bull-run in stock market history on March 12, a few days after its 11th anniversary.
The 7 Mistakes That Investors Keep on Making
Since March 23, the S&P 500 index has had a furious rally, recovering all of its 2020 losses by June 8. Some might suggest we are now out of the woods, but I would say "not by a long shot." In fact, the markets, as of June 9, were already starting to waver again. If we do emerge from this with the stock market bottoming out at -34%, we should consider ourselves extremely lucky.
For that reason, I encourage all investors to hope for the best but prepare for the worst. Remember, the S&P 500 index dropped 49% in 2000-2002 and 57% in 2007-2009. Will the economic challenges created by this crisis be less? That history is yet to be written.
As an investor, I've no
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Jun 19, 2020
Does it feel like the coronavirus pandemic has pushed all your retirement plans by the wayside? If you recently lost your job or had a reduction in income, you're probably not thinking about your long-term future and retirement plans right now. Instead, you're focused on surviving from one day to the next.
But when you get back on your feet again, don't panic or start thinking that all is lost when it comes to retirement planning. You can get things moving in the right direction again. While there are no easy answers or quick fixes in these uncertain times, here are 12 ways you can shore up your retirement plan and get it back on track.
SEE ALSO: 13 Reasons You Will Regret an RV in Retirement
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Jun 19, 2020
Apple (AAPL) to re-close a few stores, Royal Caribbean (RCL) and Carnival (CCL) dip as cruise lines to extend voluntary suspension
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Jun 19, 2020
To hear some tell it, bigger is always better on Wall Street.
After all, when Amazon.com (AMZN) is worth $1.2 trillion and boasts a dominant market share in both e-commerce and cloud computing - two megatrends that aren't disappearing anytime soon - why bother with the little guys?
But those monitoring only mega-caps when seeking out the best stocks to buy might have failed to notice under-the-radar picks with more modest market values that have led the market's rally since March. As proof, consider that the small-cap Russell 2000 is up 44% since it bottomed out March 18, compared with about 39% for the blue-chip S&P 500 off its March 23 lows.
If you're looking to outperform the market in 2020, then, you have to look beyond the usual suspects. Not only are larger stocks as a group lagging behind their smaller brethren lately, but a more fundamental fact is that most index funds are weighted toward larger companies by design; Amazon, Apple (AAPL) and Facebook (FB) currently represent about 15% of the entire S&P 500. The remaining 85% is split among 497 other components!
Whether you're looking for bigger returns or simply better diversification, here are 19 of the best stocks you've never heard of.
SEE ALSO: 50 Top Stock Picks That Billionaires Love
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Jun 18, 2020
Biogen (BIIB), Kroger (KR) among some of the day's more notable moves
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Jun 18, 2020
If you're an active investor who occasionally buys or sells stocks based on tips, you need to know what's allowed -- and what can land you in jail.
After all, the headlines are rife these days with Washington, D.C. power brokers who have brought the wrath of the Securities and Exchange Commission down on their heads.
In the highest-profile case of alleged insider trading these days, the Department of Justice is investigating Sen. Richard Burr for a series of stock sales he made after attending private coronavirus briefings. A week later the stock market tanked.
The investigation of Burr came hard on the heels of the resolution of the Chris Collins scandal. In January, the former congressman received a 26-month prison sentence and a $200,000 fine.
While in office, Collins fed information he received as a board member of biotechnology company Innate Immunotherapeutics to help his son and others avoid thousands of dollars in losses after one of the firm's drugs failed a clinical trial.
Insider trading is a complicated subject where gray areas abound. In many cases, it is perfectly legal (although potentially unwise) to trade on tips that you hear or overhear. Illegal insider trading all comes down to the facts and circumstances.
Have a look at 10 scenarios that illustrate the dos and don'ts of using insider information.
SEE ALSO: 25 Stocks That Billionaires Are Selling
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Jun 18, 2020
It comes down to whether your stimulus check will boost your "provisional income."
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Jun 18, 2020
It's time to step back and take a look at how you weathered the coronavirus crisis. Did your cash hold up? Does your job feel secure? Your answers could reveal the need to make some adjustments for the future.
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Jun 17, 2020
Tax advisors say you can reduce your tax bill by 30% to 40% in this unprecedented time.
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Jun 17, 2020
Two events — a crashing stock market and the waiver of required minimum distributions in 2020 —have unexpectedly created an ideal time to convert retirement savings from a traditional individual retirement account to a Roth IRA. Unlike traditional IRAs, withdrawals from a Roth are tax free in retirement. The catch is that federal and state taxes are owed on the conversion amount for the year the conversion is made.
The Answers to More RMD Questions
Those taxes, however, have just gotten more affordable. With the Dow Jones Industrial Average down 14% in the first four months of 2020, a shrunken retirement savings portfolio has less to tax.
For retirees with other sources of income, there's the added bonus of skipping a 2020 required minimum distribution, an option the CARES Act allows only for this year. The waiver applies to RMDs from all traditional individual retirement accounts, including inherited IRAs, as well as defined contribution plans such as 401(k)s. In any other year, those distributions, which are mandatory at age 72 and taxed as ordinary income, would only add to your tax burden. Retirees who don't need their 2020 RMD should consider converting to a Roth an amount equal to that waived distribution.
"This year is an unprecedented opportunity," says Maria Erickson, a financial advisor at Freedom Financial and Business Planning in Tampa, Fla. "The numbers are pretty compelling. Y
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Jun 17, 2020
Starting this summer, there will be a better way to file an amended tax return.
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Jun 17, 2020
Tech stocks continued to show relative strength Wednesday, but stocks more sensitive to an economic recovery struggled
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Jun 17, 2020
The Federal Reserve recently suggested that the U.S. economy will shrink by 6.5% - its worst annual performance since World War II. The Fed also expects unemployment to finish the year over 9%.
Those are good reasons to develop a heightened interest in high-yield ETFs (exchange-traded funds). That's because the Fed's key interest rate likely will hover around 0% for the next 24 to 36 months, leaving investors starved for income, while Fed Chairman Jerome Powell uses every tool at his disposal to help restart the economy.
"(The outbreak) will weigh heavily on economic activity. (It) poses considerable risks to the economic outlook," Powell stated June 10. "We're not even thinking about raising rates. We're not even thinking about thinking about raising rates."
That should make it all the more difficult to generate above-average income from equity and bond ETFs in the near to mid-term. Difficult ... but not impossible.
Here are five high-yield ETFs delivering at least 4% in annual income that you can buy for the long-term.
SEE ALSO: The 20 Best ETFs to Buy
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Jun 17, 2020
Being a millionaire isn't a ticket to mansions, yachts and caviar like it once was, but the goal is more reachable than ever.
According to Phoenix Marketing International, a firm that tracks the affluent market, 6.71% of U.S. households (or 8,386,508 out of 125,018,808 total U.S. households) now have investable assets of $1 million or more.
Note well that to be considered a millionaire by the standards of wealth research, a household must have investable assets of $1 million or more, excluding the value of real estate, employer-sponsored retirement plans and business partnerships, among other select assets.
That's only one way to measure if someone's a millionaire, of course. A net worth of $1 million also qualifies; subtract liabilities, including mortgages and car loans, from assets, including home equity and retirement savings, to determine your net worth. (Use our Net Worth Calculator to get your number.) Either way, hitting the million-dollar mark is no small feat.
Keep reading to see if you have what it takes to become a millionaire.
SEE ALSO: Millionaires in America 2020: All 50 States Ranked
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Jun 17, 2020
History repeatedly shows us a pattern with small-cap value that's being repeated yet again today
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Jun 17, 2020
Women are more vulnerable during this time of financial upheaval. Here's why and some steps they can take to help improve their outlook long term.
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Jun 17, 2020
In conversations with clients, colleagues and friends, there's one habit many seem to struggle with: spending money. No matter how much we earn, the amount we spend often impacts more of a person's future financial success than their income, savings or investment returns. Try as we might, cutting back our spending is never easy. Until now.
The current pandemic has impacted all of us. For more than 40 million Americans, it's meant the loss of a job and a steady income. For those fortunate enough to have their health and their jobs, nearly everyone I've spoken with is spending much less money than they were three months ago.
We know there eventually will be pent-up demand for travel, dining out and other activities. My family is already dreaming about the vacations we will take. However, this forced spending reduction may be a once-in-a-lifetime opportunity to re-evaluate our spending habits, invest more and reshuffle the financial deck. The question now is: Can we sustain a modified spending level once we solve the COVID-19 puzzle and return to a more normal life?
Here are some recommendations on how to make at least some of these spending cuts permanent and bolster your finances:
SEE ALSO: How to Spend Your Stimulus Check If You're Broke
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Jun 16, 2020
Fed's bond backing, Powell's suggestion for more Congressional spending and hints at an infrastructure plan lifted stocks broadly Tuesday
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Jun 16, 2020
The COVID-19 pandemic has many people finally taking action to fill out advance health care directives, wills and powers of attorney. Here are some tips to help you along the way.
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Jun 16, 2020
Watching your portfolio dive doesn't feel good, but such a situation can come with some positive financial possibilities. Here are some strategies you may want to take advantage of right now.
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Jun 15, 2020
DJIA falls by more than 700 points, but Fed bond announcement helps the index finish in the black
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Jun 15, 2020
Hedge funds entered 2020 on a bit of a roll. The Preqin All-Strategies Hedge Fund benchmark delivered an 11.45% return in 2019 - only the second time the industry has registered double-digit returns since the beginning of 2014.
The pressure was on to repeat the performance in 2020. But COVID-19 hit, and all bets were off. Billionaires and hedge funds with billions in assets have spent the first part of the year trimming or completely exiting positions.
As we've said in looking at billionaires' top stock picks, it's both interesting and constructive to know what the "smart money" is doing. That's because they boast rich resources and deep connections to insiders that can give them insights into stock picks that most other people simply don't have. It can be equally instructive to look at what they're unloading, and why.
Here are 25 stocks that billionaires have been selling so far in 2020. Many of those sales were stocks most likely to be affected by the virus: airlines, hotels, retailers, restaurants, casinos and other businesses that can't make money without people physically visiting their establishments or utilizing their services. In some cases, however, the "smart money" prudently took profits on holdings that were working quite well for them. And once in a while, you'll find that some billionaires are ditching what other institutional investors covet.
SEE ALSO: Hedge Funds' 25 Top Blue-Chip Stocks to Buy Now
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Jun 15, 2020
Yale's endowment has delivered consistent income with minimal stock risk. Here's a look at how they did it and what it could mean for you and your portfolio.
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Jun 15, 2020
Once you quit earning a paycheck and start living off your savings, what's your income shortfall going to be? Where is that money going to come from? Anyone nearing retirement needs to have their income ducks in a row.
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Jun 12, 2020
Buying a home may be one of the biggest purchases you will ever make. The more you know about the home buying process, the more money, time and hassle you'll save. And given the global health pandemic, there are certain precautions you'll need to take to help protect yourself when the time comes to view prospective properties in person.
We've outlined 12 things you should prepare for now if you plan to purchase a new house in the months ahead. Take a look.
SEE ALSO: 11 Things Every Home Seller Should Do
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Jun 12, 2020
As a home seller, your goal is to sell your property quickly for the most money possible. However, in the wake of COVID-19, you'll need to take some extra steps to adapt your selling strategy to the current market -- such as incorporating social distancing procedures with in-person home tours.
Here, we've outlined several steps would-be sellers should take to seal the deal (safely!) and get top dollar for their home.
SEE ALSO: 12 Things Every Home Buyer Should Do
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Jun 12, 2020
Traveling is fun and you can do it without breaking the bank -- you just have to know where to go online first. And if you're tired of wondering which sites are best for each part of your trip planning, we've got you covered. Here are the best travel sites we've found to help you bag the bargains on airfares, lodging, car rentals and all your other travel needs. Best of all, almost all of the travel websites are free to use. Bon voyage!
SEE ALSO: 8 Reasons to Retire in an RV
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Jun 12, 2020
ADBE climbs higher on record revenues; Goldman, Morgan Stanley downgrade TSLA
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Jun 12, 2020
We talk a lot about investing in stocks, bonds, mutual funds, and ETFs here at Kiplinger. But as Ben Franklin once said, "an investment in knowledge always pays the best interest." And if you're going to college to further your education and expand your mind, Uncle Sam offers a few tax breaks that can increase the return on your investment.
Some of the tax deductions and credits are for people who are saving for college, while others help to pay for tuition and books while you're a student. There are also tax breaks that help with student loan debt once your days in the classroom are over. However, the rules can be tricky, and sometimes you can't take advantage of one tax break if you already claimed another. So, it's important to be up to date on all the rules all the time. Here's a breakdown of 12 tax deductions, credits, and exemptions that can help you pay for college. No matter where you are on your quest for knowledge, there's probably a tax break that can help your bottom line.
SEE ALSO: Tax Changes and Key Amounts for the 2020 Tax Year
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Jun 12, 2020
The stock market has been remarkably resilient this year amid the pandemic and recession. But the Dow's massive 1,800-point plunge on June 11 should serve as a reminder that equities remain risky.
And some are much riskier than others.
Every investor wants to buy "when there's blood in the streets." The hard part is making sure it's not your blood.
To be sure, there is no shortage of stocks for which a bear case can be made. Some of these stocks could very well be beaten-down bargains. Others, not so much.
To get a sense of where the traps might lie, we searched the S&P 500 for stocks with the lowest average analyst recommendations. Furthermore, because analysts are so reluctant to issue Sell recommendations, we homed in on stocks with a comparatively high number of these bearish calls.
Lastly, we dug into research and fundamentals. After applying our criteria, we found stocks to sell among retailers, consumer staples, energy, financials and even the odd utility. But five names looked particularly risky.
Have a look at these five troubled stocks, which have some of the lowest average analyst ratings in the S&P 500. If you're looking for stocks to sell or avoid, these would be worthy candidates.
SEE ALSO: 50 Top Stock Picks That Billionaires Love
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