REVIEW www.assettv.com • 1st Quarter 2016
Frank Muller
Breaking the Mold of Traditional Investment Strategies
PLUS INSIDE:
Nuveen
2016 Ten Predictions from Bob Doll
MASTERCLASS
Deutsche Asset Management 2016 outlook and opportunities
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2016 Ten Predictions from Bob Doll 6-7
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Breaking the Mold of Traditional Investment Strategies
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Frank Muller, Provasi Capital Partners
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This material is neither an offer to sell nor the solicitation of an offer to buy any security. Such an offer can be made only by prospectus, which has been filed with the Securities and Exchange Commission and is available at sec.gov, and sold by broker-dealers authorized to do so. 3469-1 • © 2015 Provasi Capital Partners LP
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REVIEW FEATURED ARTICLE
Other Featured Videos Fidelity’s Q1 2016 Market Update: Will the global economy stabilize in 2016?
BREAKING THE MOLD OF TRADITIONAL INVESTMENT STRATEGIES Frank Muller, Provasi Capital Partners What do you think is preventing investors from actually achieving their financial goals? In my opinion, their fear/greed impulse kicks in where people tend to buy at the top and they sell at the bottom. They’re being proffered this basic idea that they can allocate capital, 60% stocks, 40% bonds, and that’s the pathway to financial salvation. What does Provasi do differently? Provasi is built around the idea of challenging that notion, that financial science didn’t begin and end with a 60/40 stock bond allocation, and that there are other return streams that are vital to creating a portfolio that helps people sustain themselves through retirement. So the basic idea behind the franchise is to provide access to managers and strategies, package them in the right way, and distribute them into the right channels of capital. What does diversification mean to Provasi? So what’s really interesting is
that when you begin to expand the notion of diversification, you have to move into that world of alternative investments.
$880,000. You will look at that and go, “That’s not what I expected from diversification.”
I believe that advisors are looking for an independent voice, a judgment as to manager selection, portfolio construction, strategies that can provide real diversification benefits, and to transfer that information into the marketplace in a succinct, compelling, and informative way.
So what if you just do things a little differently? What if you just take 75% of the portfolio, put it in that 60/40 model but take 10 other strategies, 2½% in each? In 2002 and 2008, the same drawdowns are in the single digits. Your account value is worth well over a million dollars, in fact, it’s worth about $230,000 more.
What is the problem with the traditional 60/40 model?
What do you see in the future for financial advisors?
Since 2000, the average investor has had a return of around 2½%2.7% on their money. We’ve got to ask ourselves, why is that occurring? It’s the traditional model: Assume your retirement portfolio has a balance of a million dollars in 2000, and it’s allocated 60% in stocks and 40% in bonds. At the end of the year, you begin to withdraw 4% annually and factor in increases 3% a year for inflation.
You know what’s really interesting about this, when you talk with financial advisors; they have access to thousands of managers and strategies. But they need help sorting through them.
Here’s the problem: In 2008 that account’s down 2728%. At the end of 2014 your million dollars is worth around
I think that over the next 1020 years, financial advisors are going to start to ask very important questions. Who do I turn to for independent advice about how to build better portfolios and access great managers? We think Provasi will be part of that.
Dirk Hofschire, Senior Vice President of the Asset Allocation Research Team, shares Fidelity’s insights on the global economic and financial market developments in Q4, and provides a look ahead to 2016.
Leveraging long/short strategies to help reduce volatility impact
Mihir Meswani, portfolio manager of Deutsche Strategic Equity Long/Short Fund, discusses areas of opportunity globally given today’s consumer and other trends and how a longshort strategy can help diminish potential downside exposure.
Tax loss harvesting opportunities using ETFs
Adam Patti, CEO of IndexIQ, explains how the ETF structure can help investors mitigate tax losses as well as take advantage of volatility in the marketplace.
www.assettv.com 1st Quarter 2016 5
SPECIAL FEATURE
2016 TEN PREDICTIONS FROM BOB DOLL Investors See Glimmers of Hope Along a Rocky Path
Bob Doll, Nuveen Lead Portfolio Manager and Chief Equity Strategist
Believing that the U.S. and global economy will regain some strength in 2016, and inflation in the developed world, especially in the U.S., will pick up some on the back of wage-rate growth, we believe interest rates will move up somewhat.
Heading into an uncertain 2016, Bob Doll, Nuveen Lead Portfolio Manager and Chief Equity Strategist, sheds some light on what’s to be expected in his top 10 predictions for the new year.
With a slow-growth environment on
the horizon, Bob Doll offers his key insight on such topics as interest rates, high yield spreads, consumer spending, foreign equities, and the impact geopolitics play on the market. While there are many factors financial experts should be concerned with in 2016, Bob Doll offers plenty of silver linings to look for as well, ensuring this will be a year that will keep investors on their toes.
Never before has growth been as slow as we anticipate it will be in 2016, and as it has been for the last 9 years. This will be the 10th year in a row where we have sub-par both real and nominal growth. 6
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Perhaps the most significant headwind in 2015 of the U.S. stock market was the decline in earnings expectations. We expect some reversal in 2016.
It is very rare for the U.S. stock market to have single digit moves in back-to-back years, whether there’s a plus or a minus sign in front of the number. This could be that 2 year period.
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2015 was an interesting year in that stocks, bonds, and cash were all up, but by a very small amount. For the end of the year, stocks did beat bonds and bonds did beat cash, and we expect that stocks will win the race again.
If there’s any good news in these it’s that most of the time, markets have a little blip when something happens and then go back to normal. Our guess is there will be more blips, but we will continue to go back to normal.
For most of the last 5 or 6 years, U.S. stocks beat non-U.S. stocks and U.S. bonds beat non-U.S. bonds. We think we are at the beginning of a switch in that paradigm.
With the bill signed by the congress and the president in the 4th quarter of 2015, our era of fiscal austerity is likely over, and the deficit will start moving up the other direction.
Every year we have a prediction that pits several sectors against some other sectors, and our view is that it’s going to be fairly similar to last year, that is, the resource-based sectors that require pricing power are not likely to lead the parade.
Our view is if the Republicans nominate the right candidate, whoever that is, and unite behind that person, there’s a chance they can beat Hillary Clinton. If they remain fractured as they currently are with so many running for president, Hillary will be elected president, most likely.
www.assettv.com 1st Quarter 2016 7
LIVE WEBCAST EVENT - DECEMBER 16, 2015
FED DECISION DAY: FIND OUT ITS IMPACT AND WHAT’S AHEAD EXCLUSIVE: New York Life MainStay Investments
Charles Reinhard
Kera Van Valen, CFA
Louis Cohen, CFA
Managing Director, Portfolio Strategist, MainStay Investments
Managing Director, Portfolio Manager, Senior Research Analyst
Senior Managing Director, Senior Portfolio Manager, Global Fixed Income Team
“The US economy and the world economy is in a position where it should continue to grow next year, and in fact, it should grow a little bit faster next year than this year.”
How would you rate the impact of the Fed’s decision to raise rates? All of the teeth gnashing over whether or not the Fed should do anything, in our view, at least for the first 25 basis points, the only direct impact that really matters is on the value of the US dollar because we do have this certainly disjointed or off-centered relationship with other major world currencies. In fact, the manufacturing base, particularly for exports and those that compete most actively with imports, is being damaged by what’s happened with the rally in the dollar. In terms of measuring an impact, it’s hard to measure the impact of a single 25 basis point increase. The only place you
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“Companies that have increased their dividend or at least maintained their dividends, have outperformed companies that have cut their dividend or do not pay a dividend at all.”
can really see it is in the value of the dollar. Where do you see the US and global economies heading? The US economy and the world economy is in a position where it should continue to grow next year, and in fact, it should grow a little bit faster next year than this year. China, India, parts of South East Asia, and also parts of Africa are expected to be the fastest growing parts of the world economy. In the IMF forecast, it states that the world economy will grow about half a percent faster next year than this year. On the inflation front, inflation is not a clear and present danger in the United States.
“Markets go through dislocation, they are recipients of a variety of stimuli and ultimately the market will adjust to its fundamental value.”
The Fed does see inflation inching up higher next year, as some of the transitory effects of low energy prices and some others work their way out of the system. How does risk change in a Fed tightening regime? For a fixed income investor, obviously we have individual bond risk, but we also have this concept of portfolio risk. The question of ‘where can things go wrong?’ is in many ways a macro question, and as we look at it today, and we talk about slow increases in interest rates, moderate growth, all these other things going on, one of the things that strikes us is that there are signs of wage pressures in the economy.
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The excessive supply of labor has undoubtedly been shrinking and the price of labor has undoubtedly been increasing. That’s particularly important against the backdrop of slow growth. Profit margins could come under pressure if you have slow growth and rising labor costs. It’s something we’re on the lookout for, and I’m not suggesting that is the dominant scenario, but that’s where we think some of the risk lies today. How has the world changed since the last Fed tightening in 2006? I would say that a big part of the growth rate of this expansion being slower than that of the prior one can be attributed to the lack of input from the housing sector. Looking more globally, it’s the size of emerging market economies relative to developed economies in the world
today. If you look at incremental growth, in a good year, China and India can contribute almost half of the incremental world growth of the economy. That did not use to be the case. I think another really important change is that once upon a time, if the Fed raised interest rates, chances were that monetary policy at the global level was tilted in the same direction of what the Fed had done because of the size of the US role in the international financial system. Today, we have other central banks that are going in a different direction. What is your opinion on the energy sector, specifically what we’re seeing with oil? I think there’s a positive dynamic that’s totally under-communicated. If you run through some simple math, the decline in oil prices is worth 2 trillion
US dollars to global consumers. The other thing that’s worth mentioning is the US has become a significant oil producer. The good news there is that we are a very efficient energy producer, and the US energy industry employs approximately 400,000 people. It’s tiny in a nation of 330 million citizens. We have 400,000 Uber drivers now. So it gives you some idea about the change in the economy. If you drive around the country, you see people filling up giant SUVs for $50, and then on Friday night going out to a bar or restaurant. We firmly believe it is a net stimulative impact. Now having said that, savings rates are going up, people are saving a little more carefully, so we haven’t seen the full effect, but in fact, at least the basis is positive, not negative.
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Videos available on the iShares by BlackRock Channel
The Fed’s New Path
Insight into Action: US Technology
Matt Tucker - Head of iShares Americas Fixed Income Strategy
Heidi Richardson - Global Investment Strategist for BlackRock
Matt Tucker comments on the Fed’s decision to raise rates and
Heidi Richardson explains why investing in the US technology
offers his outlook for investors in the coming year.
sector is a smart move.
iThinking: Rising Rates – Prepare Your Bond Portfolio
iThinking: Rising Rates – Opportunities in Stocks
Matt Tucker - Head of iShares Americas Fixed Income Strategy
Heidi Richardson - Global Investment Strategist for BlackRock
Matt Tucker shares his insight on how to reduce risk in a bond
Heidi Richardson explains how to mitigate volatility in a bond portfolio
portfolio, despite the impact of a rising rate economy.
in a rising rate environment, and shares her thoughts on potential opportunities in equities.
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iTHINKING
TM
INSIGHT INTO ACTION: RISING INTEREST RATES Key Takeaways The Fed has indicated that it will begin raising interest rates in the near-term Rates are expected to rise gradually, and are likely to remain low for a long period of time For well-prepared investors, rising interest rates may present opportunities
Not your father’s rate hike
Heidi Richardson, CPM Managing Director
After more than six years, the Fed is finally poised to end its zero-interest-rate policy and embark on its first rate hiking cycle in nearly a decade. It’s a move that global markets have been anticipating for some time.
Heidi Richardson is the Head of Investment Strategy for U.S. iShares and the lead investment strategist for iThinking.
This is no ordinary interest rate cycle, however. While rate hikes have traditionally sought to cool an overheating economy, today the Fed is attempting to “normalize” rates from their extraordinarily low levels since the financial crisis. The Fed has also signaled that rate increases will be gradual, which should keep interest rates below historic averages for some time.
As the chart below illustrates, even though prices of bonds in the Barclays U.S. 1-3 Year Credit Bond Index fell during the last rising rate cycle, income payments more than offset this loss to generate a positive total return.
React, don’t overreact
A thoughtfully-allocated, diversified portfolio can help investors reduce the impact of rising rates as well as capture growth potential.
Prepare your bond portfolio
With a rate hike on the horizon, many investors are concerned with how their bond portfolios will perform. Remember that bonds have two sources of risk: interest rate and credit risk. While it’s true that bond prices fall as rates rise, two actions may help provide protection. Shorten duration Bonds with higher duration (a measure of sensitivity to interest rates) generally have had greater potential for losses when rates rise. Shortening the duration of your bond portfolio can potentially help manage losses due to rising interest rates. Focus on credit exposure Seek a better balance of risk and reward by focusing on credit exposure. Corporate bonds typically provide additional yield over Treasuries. Combining these actions can be an effective way to navigate a rising rate environment.
Barclays U.S. 1-3 Year Credit Bond Index performance (June 2004 – June 2006)
Growth of $100
While many may fear rising rates, there may be an upside. The Fed has been signaling plans to raise rates for over a year, and markets have been adjusting in preparation for it. When rates do rise, we expect increased volatility, but believe it may be shortterm. Rising rates reflect a healthier, growing economy, and the Fed has pledged to act only if the U.S. economy appears resilient enough to withstand it.
106 104 102 100 98 96 94 92 90 Jun-04
Total Return
Price Return Dec-04
Jun-05
Dec-05
Jun-06
Source: Barclays as of 8/12/15. Index returns are for illustrative purposes only. Index performance returns do not reflect any management fees, transaction costs or expenses. Indexes are unmanaged and one cannot invest directly in an index. Past performance does not guarantee future results. Index returns do not represent actual iShares Fund performance. For actual fund performance, please visit www.iShares.com or www.blackrock.com
Funds such as the following provide short duration corporate / credit exposure:
FLOT
iShares Floating Rate Bond ETF
NEAR
iShares Short Maturity Bond ETF (Active)
CSJ
iShares 1-3 Year Credit Bond ETF
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Look for potential opportunities in stocks
Focus on well-positioned sectors in a rising rate cycle
Consider new sources of income
In a rising rate environment, debt-laden sectors, such as utilities and telecom, tend to underperform cash-rich sectors,1 like technology. Additionally, more reasonably valued cyclical sectors, such as technology and financials, may benefit from a strengthening U.S. economy.
High dividend payers have become quite expensive in comparison to the broad US market5 and may come under pressure as rates rise. In a rising rate environment, dividend growers could potentially outperform high dividend stocks based on their more reasonable valuations.6 In contrast, a dividend growth strategy may offer:
The technology sector has generally been a beneficiary of an improving economy2 and, as the only sector in the S&P 500 with more cash than debt,3 could be less affected by increased borrowing costs. Financials currently have a price-to-book ratio of about half of the broad U.S. market,4 and could potentially benefit from rising rates by capturing a bigger spread (profit) on the rates at which they loan money.
400
7.0
350
6.0
EBITDA
300
5.0
250
4.0
200
3.0
150
Funds such as the following may provide opportunities in a rising interest rate cycle:
DGRO
iShares Core Dividend Growth ETF
IYW
iShares U.S. Technology ETF
IYG
iShares U.S. Financial Services ETF
2.0
100
1.0
50 0 12/98
Fed Funds Target Rate
Revenues for Diversified Financials through Rate Cycles
A higher allocation to cyclical sectors that have the potential to grow alongside the economy Exposure to companies that have the potential to sustainably grow and increase dividends over time
12/00
12/02
12/04
12/06
12/08
12/10
12/12
12/14
0.0
S&P 500 Diversified Financials Industry Group Index EBITDA Fed Funds Target Rate
Source: Bloomberg as of 8/13/2015
Carefully consider the Funds' investment objectives, risk factors, and charges and expenses before investing. This and other information can be found in the Funds' prospectuses or, if available, the summary prospectuses which may be obtained by visiting www.iShares.com or www.blackrock.com. Read the prospectus carefully before investing. Investing involves risk, including possible loss of principal. Funds that concentrate investments in a single sector will be more susceptible to factors affecting that sector and more volatile than funds that invest in many different sectors. There is no guarantee that any fund will pay dividends. Technology companies may be subject to severe competition and product obsolescence. Performance of companies in the financials sector may be adversely impacted by many factors, including, among others, government regulations, economic conditions, credit rating downgrades, changes in interest rates, and decreased liquidity in credit markets.
1. Source: Bloomberg, as of 07/13/15 2. Source: Goldman Sachs Global Investment Research, as of 6/11/15 3. Source: Bloomberg, as of 8/23/15 4. Source: Bloomberg, as of 8/23/15 5. Source: Bloomberg, as of 8/23/15 6. Source: SocGen. Based on the MSCI World Index quarterly annualized real returns between 3/31/86 – 03/31/15 The information presented does not take into consideration commissions, tax implications, or other transaction costs, which may significantly affect the economic consequences of a given strategy or investment decision. This document contains general information only and does not take into account an individual's financial circumstances. This information should not be relied upon as a primary basis for an investment decision. Rather, an assessment should be made as to whether the information is appropriate in individual circumstances and consideration should be given to talking to a financial advisor before making an investment decision. The information included in this material has been taken from trade and other sources considered to be reliable. We do not represent that this information is accurate and complete, and it should not be relied upon as such. Any opinions expressed in this material reflect our analysis at this date and are subject to change. The information and opinions contained in this material are derived from proprietary and nonproprietary sources deemed by BlackRock to be reliable, but are not guaranteed as to accuracy.
This material is not intended to provide, and should not be relied on for, accounting, legal Fixed income risks include interest-rate and credit risk. Typically, when interest rates rise, or tax advice. You should consult your tax or legal adviser regarding such matters. there is a corresponding decline in bond values. Credit risk refers to the possibility that the The Funds are distributed by BlackRock Investments, LLC (together with its affiliates, bond issuer will not be able to make principal and interest payments. “BlackRock”). Actively managed funds do not seek to replicate the performance of a specified index. Actively ©2015 BlackRock. All rights reserved. iSHARES, BLACKROCK and iTHINKING are managed funds may have higher portfolio turnover than index funds. registered and unregistered trademarks of BlackRock. All other marks are the property of This material represents an assessment of the market environment at a specific time, is their respective owners. subject to change, and is not intended to be a forecast of future events or a guarantee of iS-16364-0915 future results. This information should not be relied upon by the reader as research or investment advice regarding the funds or any security in particular. Not FDIC Insured No Bank Guarantee May Lose Value The strategies discussed are strictly for illustrative and educational purposes and are not a recommendation, offer or solicitation to buy or sell any securities or to adopt any investment strategy. There is no guarantee that any strategies discussed will be effective. www.assettv.com 1st Quarter 2016 13
Trending on assettv.com Volatility
Volatility Creates Opportunities
Realized Volatility Indices: Measuring Market Risk
David Herro – Deputy Chairman, Portfolio Manager and CIO at Harris Associates L.P.
Craig Lazzara - Global head of index investment strategy at S&P Dow Jones Indices
David Herro – Deputy Chairman, Portfolio Manager and CIO
Watch as Craig Lazzara and Tim Edwards of S&P Dow Jones
at Harris Associates L.P., an affiliate of Natixis Global Asset
Indices discuss volatility and how it may feature in investment
Management – discusses how recent market volatility is creating
strategy decision-making.
opportunities for investment.
Navigating High Yield Volatility
Fidelity: Sectors Provide an Opportunity to Help Manage Volatility
Thomas Ray, CFA, NWQ Investment Management Head of Fixed Income
Chris Bartel - Head of Global Equity Research at Fidelity Investments
At the end of a volatile year for the high yield market, Tom Ray,
Chris Bartel, Head of Global Equity Research, shares Fidelity sector
CFA, NWQ Investment Management Head of Fixed Income,
portfolio managers’ views on potential investment opportunities
provides his perspective on what the energy sector had to do with
and the major risks in each sector in 2016.
it and why the high yield selloff may create unique opportunities for income investors. 14
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Municipal Bonds
Retirement
Key Considerations for Today’s Muni Investors
Reinventing Retirement Income: Is Your Portfolio Retirement Ready?
Joseph Deane - Head of Municipal Bond Portfolio Management
Carl Katerndahl - EVP at Nuveen Investments, Ryan Madigan - SVP Wealth Management Services, Anne Kritzmire - Managing Director Closed-End Funds Tom Streiff - Senior Managing Director Retirement Income at TIAA-CREF
PIMCO experts Joe Deane, David Hammer, Julie Callahan and Sean McCarthy discuss the transformation of the muni market since the financial crisis and key factors investors should not ignore.
Financial experts from Nuveen discuss current key retirement themes such as extended life expectancy, new laws regarding social security, and the yields for various retirement packages.
MacKay Muni 2016 Insights
The Importance of Saving for Retirement
Bob DiMella - Executive Managing Director at MacKay Shields
John Galateria - Head of North America Institutional at J.P. Morgan Asset Management
What do MacKay Municipal Managers believe is a key to
The importance of saving early for millennials as they face a number of headwinds on the journey to retirement.
managing muni portfolios this year? Find out in their “Top Five Municipal Market Insights for 2016.”
www.assettv.com 1st Quarter 2016 15
Commodities
Municipal Bonds
Jodie Gunzberg - Global Head of Commodities at S&P Dow Jones Indices
John Miller - Co-Head of Fixed Income at Nuveen Investments
“When you have a shortage of a commodity the only thing that can
“Liquidity ultimately is a function of demand. If the retail base, 70%
bring the market back into equilibrium is the price. It has to trend
of the demand, is still engaged, is still investing, liquidity should be
up by definition. And once it trends up and the producers are doing
fairly good.”
everything they can to drill, mine and grow as fast as they can, and they fill the inventory back up, then the price has to fall.”
Stable Value
Mutual Fund Administration
Warren Howe - National Sales Director of Stable Value Markets at MetLife
Lisa Mougin - SVP, Director of Sales and Relationship Management at ALPS
“All of that together is really going to mute the amount of yield
“So as administrators, trying to be innovative with how we can help
pickup that money markets are going to have relative to stable
clients bring those to market because often their strategies we
value.”
found will be more successful in that structure that has really gained traction.”
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Changing Global Landscape
Defined Contribution
Brian McMahon, CEO and Chief Investment Officer Thornburg Investment Management
Kristen Colvin - Director, MFS Institutional Advisors at MFS
“Many
utilities
around
the
world
are
increasing
their
alternative energy as a portion of their base. In certain parts of
“We think it’s incredibly important to focus on what can actually move the needle in terms of retirement outcomes.”
the world, say Spain, you have more than 25% of the electricity generated by solar and wind.”
Nuveen on Closed-End Funds
Fixed Income
Anne Kritzmire - Managing Director, Global Structured Products Marketing at Nuveen Investments
Raman Srivastava, CFA - Co-Deputy Chief Investment Officer and Managing Director at Standish Mellon Asset Management Company LLC
“We believe our shareholders really prefer smooth or smoothly
“Increasingly what we’ve seen is a shift to more and more issuance
changing distributions versus big ups and downs. So that’s another
coming outside of the US. The US at this point makes up roughly
factor to try and keep the funds distributions up there even if the
40% of the global fixed income market.”
earnings sort of wander a little bit.”
www.assettv.com 1st Quarter 2016 17
ARM yourself with retirement CE
Retirement Insights
Invesco is invested in your professional development. If you’ve earned a financial industry d in your professional If you’ve earned a financial industry designation, you know it’s important to development. broaden your expertise, keep up with the industry latest developments Invesco isdevelopment. invested in your professional If you’ve earned a financial know it’s important broaden your it’s expertise, keep with the latest developments in yourto field, and know enhance your credibility as a financial professional. designation, you important to up broaden your expertise, keep up with the latest developments enhance yourincredibility a financial your field,asand enhanceprofessional. your credibility as a financial professional. That’s why Invesco Consulting created the Advanced Retirement Markets (ARM) CE Webinar o Consulting Program. created the Advanced Retirement Markets (ARM) CE Webinar These lively, timely, informative offer the CE credit you(ARM) need,CE andWebinar Invesco will That’s why Invesco Consulting created the webinars Advanced Retirement Markets Meet the team members who can add vely, timely, notify informative webinars offer theinformative CE you need, and accrediting organizations of credit your earned credit. Program. These lively, timely, webinars offerInvesco the CEwill credit you need, and Invesco will organizations of your earned credit. notify accrediting organizations of your earned credit. For 2016, Retirement Business Strategist Thomas Rowley and co-presenters will offer eight ment Businessentertaining Strategist Thomas Rowley and co-presenters will offer eight and educational webinars. TheThomas schedule below listsco-presenters dates for thewill liveoffer programs, For 2016, Retirement Business Strategist Rowley and eight but you educational webinars. Theand schedule lists dates forwatching the live programs, you for the live programs, but you can also earn CE educational credit below by registering and a below replay lists atbut invesco.com/RetirementPlans. entertaining webinars. The schedule dates nt credit by registering and watching a replay at invesco.com/RetirementPlans. can also earn CE credit by registering and watching a replay at invesco.com/RetirementPlans. nt
grams
s and outs
The ARM team: Changing the retirement conversation Retirement Insightsvalue with additional retirement planning expertise:
2016 webinar programs 2016 webinar programs
Date
Roth revisited: IRA ins and outs Jan. 27, 2016 Roth revisited: and outsstrategies It’s about time: IRA IRA ins distribution
Invesco’s Advanced Retirement Markets Invesco’s Advanced Retirement Markets Continuing Education (CE) Webinar Program Invesco’s Advanced Retirement Markets ARM yourself withEducation retirement CE (CE) Webinar Program Continuing Continuing Education (CE) Program Landon Cullison CE Genelle CoffeyWebinar Alex Streusand Anthony Bui ARM yourself with retirement Internal Sales Internal Sales Internal Sales Internal Sales Invesco is invested in your professional development. If you’ve earned Consultant a financial industry Invesco’s Advanced Markets ARM yourself with retirement CERetirement Consultant Consultant Consultant designation, you know it’s important to broaden your expertise, keep up with the latest developments Invesco is invested in yourEducation professional development. If you’ve earned a financial Program industry in your field, and enhance your credibility as a financial professional. Continuing (CE) Webinar designation, you know it’s important to development. broaden your expertise, keep up with the industry latest developments Invesco is invested in your professional If you’ve earned a financial Date Co-presenter Date
Jan. 27, 2016 Anthony Feb. Bui Jan. 24, 27, 2016 2016
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CE designations
Anthony Aug. Bui May 25, 31, 2016 2016
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Landon Coffey Cullison Genelle Genelle Coffey Alex Streusand Alex Streusand Anthony Bui AnthonyCoffey Bui Genelle
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These lively, timely, informative webinars offer the CEearned credit need,CE and Invesco will Management Advisor (APMA) Chartered Retirement Plans Specialist (CRPS) Accredited Portfolio Management Advisor (APMA) Chartered Retirement Plans Specialist (CRPS) That’s why Invesco Consulting created the Advanced Retirement Markets (ARM) Webinar Accredited Wealth Management Advisor (AWMA) Personal Financial Specialist (PFS) Helping professionals get,keep keepup and grow with anagement Advisor (AWMA) Personal Financial Specialist (PFS)accrediting Accredited Wealth Planner Management (AWMA) Personal Financial Specialist (PFS) important designation, you know it’s tofinancial broaden your expertise, with thebusiness latest developments notify organizations of your earned credit. Certified Financial (CFP) Advisor Registered Paraplanner (RP) Program. 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Each of our 20-plus That’s whyRetirement Invesco Consulting created the Advanced Retirement Markets (ARM) Webinar entertaining and educational webinars. TheThomas schedule below lists dates for the liveCE programs, but you For 2016, Business Strategist Rowley and co-presenters will offer eight Business Thomas Rowley Contact usStrategy compelling programs —below based on leading-edge research and organized Program. These lively, timely, informative webinars offer the CE credit you need, and Invesco willyou can also earn CE credit by registering and watching a replay at invesco.com/RetirementPlans. entertaining and educational webinars. The schedule lists dates for the live programs, but Contact Director, ARM TeamusRetirement 713 214 5615 Independent Advisor 800 337 4246 Thomas Rowley 2016 webinar programs Date into four sales consulting disciplines — is designed toCo-presenter help you turn your accrediting organizations of your earned credit. 713 5615 Independent 800earn 337 4246 ARM214 Team 713Advisor 214 4246 5615 notify Independent Advisor 337 4246 can also CE credit by registering and watching a replay at invesco.com/RetirementPlans. National Wirehouse 800 998 Retirement Plan Division 800 370 1519 Business Strategy Director, Retirement 800 se 800 998Dealer 4246 Plan Division 800 370 1519 National WirehouseRetirement 998 4246 challenges Retirement Plan Division 370 1519 into opportunities. Whether you need to improve your communication skills with clients Broker 421 0807 Institutional and Insurance Sales 800 410 4246 Roth revisited: IRA ins and outs 800 410 4246 Jan. 27, 2016 Anthony Bui Business 800 421Dealer 0807Strategy Institutional and Insurance 800 410 2016 webinar programs Date Co-presenter Broker 800 421 0807 Sales Institutional and 4246 Insurance and prospects, buildSales and maintain your high-net-worth client base, or master will today’s fast-changing For 2016, Retirement Business Strategist Thomas Rowley and co-presenters offer eight It’s about time: IRA distribution strategies Feb. 2016 Landon Cullison 2016 webinar programs Date Co-presenter retirement landscape, we have multiple The programs tailored fit 24, your needs. entertaining and educational webinars. schedule belowtoJan. lists dates for the live programs, Roth revisited: IRA ins and outs 27, 2016 Anthony Bui but you Thomas Rowley Heir care: Beneficiary optionsby every advisor should understand March 30, 2016 Genelle Coffey Connect with Thomas Rowley and Invesco US on LinkedIn can also earn CE credit registering and watching a replay at invesco.com/RetirementPlans. Our team of 12 presenters, developers and support staff is dedicated to finding actionable answers to Director, Retirement Roth revisited: IRA ins and outs Jan. 27, 2016 Anthony Bui
The webinar sessions are approved for CE credit for the following designations: CE designations are approved forThe CE webinar credit forsessions the following designations: are approved for CE credit for the following designations: Accredited Asset Management Specialist (AAMS) Chartered Retirement Planning Counselor (CRPC) nagement Specialist (AAMS)Domestic Chartered Retirement Planning Counselor (CRPC) Accredited Asset Management Specialist (AAMS) Chartered Retirement Counselor Accredited Partnership Advisor (ADPA) Chartered Mutual FundPlanning Counselor (CMFC) (CRPC)
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Plan B:Security What happens when plans Minding the generation gap: pension Boomers, millennials Social savvy: Benefits, deficits andfail? beyondand retirement
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Genelle Coffey
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Small talk: Retirement plans for small businesses CE designations
CE Plandesignations B: What happens when pension plans fail? Sept. 28, 2016 Landon Cullison Accredited Management Specialist Chartered Retirement Planning Counselor (CRPC) The webinarAsset sessions are approved for CE(AAMS) credit for the following designations: CE designations Social Security savvy:Partnership Benefits, deficits and beyond Oct. 26, 2016 Alex Streusand Accredited Advisor Chartered Mutual Fund Counselor (CMFC) The webinarDomestic sessions are approved for CE(ADPA) credit for the following designations: Accredited Asset Management Specialist (AAMS) Chartered Retirement Planning Counselor (CRPC) Accredited Portfolio Management Advisor (APMA) Chartered Retirement Plans Specialist (CRPS) Asset Management Specialist Retirement Counselor Accredited Domestic Partnership Advisor (AAMS) (ADPA) Chartered Mutual FundPlanning Counselor (CMFC) (CRPC) Accredited Wealth Management Advisor (AWMA) Personal Financial Specialist (PFS) Accredited Domestic Partnership Advisor (ADPA) Chartered Mutual Fund Counselor (CMFC) CE designations Portfolio Management Advisor (APMA) Retirement Plans Specialist (CRPS) Certified Financial Planner (CFP) for CE credit for the following designations: Registered Paraplanner (RP) The webinar sessions are approved Portfolio Management Advisor (APMA) CharteredFinancial Retirement Plans Specialist (CRPS) Accredited Wealth Management Advisor (AWMA) Personal Specialist (PFS) Certified Investment Management Analyst (CIMA®) Accredited Wealth Management Advisor (AWMA) Personal Specialist Asset Management (AAMS) CharteredFinancial Retirement Planning Counselor (CRPC) Certified Financial Planner (CFP)Specialist Registered Paraplanner (RP) (PFS) Certified Financial Planner (CFP) Advisor Accredited Domestic Partnership Investment Management Analyst(ADPA) (CIMA®)
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ARM Team 713 214 Independent Advisor 800 337 4246 Connect with Thomas Rowley and5615 Invesco US on LinkedIn National Wirehouse 800 998 4246 Retirement Plan Division 800 370 1519 The opinions expressed are those of the author, are based on current market conditions and are subject change without notice. These opinions may differ from and0807 Invesco US ontoLinkedIn BrokerConnect Dealer with Thomas Rowley 800 421 Institutional and Insurance Sales 800 410 4246 those of other Invesco investment professionals. Connect with Thomas Rowley and Invesco US on LinkedIn Invesco does not provide tax advice.
Investment Management Consultants Association (IMCA®) is the owner of the certification marks “CIMA®,” and “Certified Investment Management Analyst®.” Use of CIMA® or Certified Investment Management Analyst® signifies that the user has successfully completed IMCA’s initial and ongoing credentialing requirements for investment management consultants. invesco.com/us
ROWLEYCE-RINSI-1-E 01/16Connect with InvescoThomas Distributors,Rowley Inc.
and Invesco US on LinkedIn US1071 US709
REVIEW Videos now on the Invesco Channel How Invesco’s Core Plus investment strategy can be an important diversification tool
IT’S TIME TO BENCH THE BENCHMARKS
Steve Thompson, Invesco Client Portfolio Manager,
Dan Draper, PowerShares Global ETFs and Meggan Walsh, Invesco Dividend Value Team What are some of the issues you have with indexes and benchmarks?
benchmarks may be buying high and selling low. Which is exactly the wrong approach.
Indexes serve a valuable purpose. To be a compass that helps people measure the direction of the market. To serve as a benchmark. To define average. But what traditional indexes were never intended to do was to define what makes a great investment opportunity.
What is Invesco’s approach?
Benchmarks don’t look for ways to boost investors’ exposure to securities that are undervalued. And benchmarks aren’t able to tap into other qualities overlooked by the market. They simply follow the herd. Investing isn’t about achieving average. It’s about achieving goals. This is why Invesco believes it’s time for investors to bench the benchmarks. Many traditional indexes rely just on market cap. They weight companies on how big they are, not necessarily on how financially strong they are. What that means is traditional
To us, the right approach means investing with high conviction through actively managed strategies and through smart beta strategies to stay ahead of the herd. High conviction means we trust our research and have confidence in our investment discipline. We look past the market noise to find the right opportunities at the right price. We assess the fair market value of companies, the way the management teams allocate their capital and their balance sheets to build portfolios that take into account both risk and returns. High conviction means we’re investors, not indexers.
Visit the Invesco Channel for latest insights: bit.ly/1LxtlWu
explains Invesco’s Core Plus investing strategies across the fixed income spectrum.
Can you explain the benefits of smart beta strategies? With smart beta strategies, investors get systematic exposure to innovative methodologies. With exchange-traded funds, this exposure’s based on an index. But smart beta indexes are not just simple gauges of the market average — they’re built from specific investments with specific characteristics: quality, low volatility, strong fundamentals, and other relevant factors. The beauty of this is investors can mix and match these strategies to pursue their investment goals, not just a benchmark. So no matter what an investor is trying to achieve — higher returns, lower volatility, or consistent income — Invesco believes that benchmarks shouldn’t dictate their decisions.
Invesco Strategic Income Fund: Exposing investors to global opportunities across fixed income
Mario Clemente, Co-Head of Investment Solutions at Invesco Fixed Income, discusses the strategy behind Invesco’s Strategic Income Fund.
What is Invesco Comstock Fund and the strategy behind it?
Kevin Holt, CIO for US Value Equities at Invesco, opens up about the Comstock Fund strategy of capitalizing on inefficiencies in the market.
www.assettv.com 1st Quarter 2016 19
NEW CHANNELS ON ASSETTV.COM Each channel is custom branded and hosts exclusive video content for the channel owner, in addition to sharing its own website links, social media feeds, whitepapers and other research documents.
NYSE - VIEW FROM THE FLOOR
FPA OF NEW YORK
Asset TV is happy to announce our new designated channel to bring viewers all the latest news and insights directly from the NYSE with our own Courtney Woodworth’s, “View from the Floor” series.
The Financial Planning Association of New York promulgates the highest standards of professionalism for the financial services industry and the public. We are thrilled to have our new channel dedicated to FPA of New York.
ASSET OWN CHANNEL
HOT PICKS
Providing the latest insights and discussion points for asset owners across various asset classes, the Asset Owner Channel is the go-to place for anything and everything related to asset investing.
One of Asset TV’s “hottest” new channels, the Hot Picks Channel showcases the most popular, informational, and trend-worthy videos on a variety of topics across our entire catalog of videos.
20
1st Quarter 2016 www.assettv.com
REVIEW Videos now on the Deutsche Asset Management Channel Considering tax swaps as the year end approaches
DEUTSCHE ASSET MANAGEMENT 2016 OUTLOOK AND OPPORTUNITIES
Dodd Kittsley, Head of ETF Strategy for Deutsche Asset Management, offers his advice for investors as 2015 draws to close, and provides some potential investment opportunities for 2016.
Larry Adam, Owen Fitzpatrick, John W. Vojticek, Dodd Kittsley, Deutsche Asset Management What are some of your key themes for 2016? The first one is that we are entering the late stage of a business cycle, and there’s a couple of things that are important about that. The first one is that historically that part of the cycle tends to be the longest. So that’s a good thing for investors. The bad thing is that when you get into the late cycle, you tend to see much more muted performance. When you look at the S&P 500, historically it has a return around 7-10%, during the late cycle it’s only about 5.9%. So the important thing here is that during 2016, I think investors have to dull down their expectations of what to expect from their portfolios. The second key theme throughout 2016 is going to be monetary policy, more importantly the divergence. It’s the first time The Fed has raised rates in 9 years. And the divergence with its other
counterparts around the world is unprecedented. Clearly that’s going to have repercussions on the equity markets, fixed income, commodities and the dollar. The third thing just to keep in mind this year is that performance is going to be much more fundamentally driven, and I think that that’s an environment where active money managers start to outperform passive investment vehicles. What is your outlook for fundamentals within the US at this point? I think late cycle in general is good for real estate. If you think about different asset classes within real estate, if you have a storage facility or an
Visit the Deutsche Asset Management Channel for latest insights: http://bit.ly/1K06aKy
Risk considerations for international investing
apartment, those are benefitting real time from the economy. But some of the other assets are more what we call lagging cyclicals, so office rents, industrial rents, retail rents…for them, the benefit of the improvement in the economy doesn’t come through the cash flow until later. So if you look into 2016, we expect earnings growth in sort of the high single digits still across our sector where across the S&P you have much lower earnings growth. So we’re pretty excited about the benefit of sort of late cycles of the real estate companies.
Theresa Brennan, ETF Regional Vice President, discusses the positive performance of currency-hedged investments in 2015 and offers her perspective on international investments for 2016.
Maximizing dividend-paying stocks to boost income
Arne Noack, ETF Product Specialist, discusses the problems facing income-seeking investors in a low-rate environment, while offering possible solutions through ETFs focused on high dividend-yielding stocks.
www.assettv.com 1st Quarter 2016 21
SPECIAL FEATURE
AMERICAN FUNDS CHANNEL Videos available on the American Funds Channel
Investment Themes to Watch in 2016
China, U.S. Trade Places as Global Growth Engine
Tim Armour - Portfolio Manager at Capital Group
Rob Lovelace - Portfolio Manager at Capital Group
Portfolio managers Tim Armour and Rob Lovelace discuss investment
Portfolio manager Rob Lovelace offers his perspective on recovery
opportunities in the emerging markets, oil and commodities, health
and growth in China, the U.S., Japan, Europe and the emerging
care and pharmaceuticals, and the internet.
markets.
2016 Fixed-Income Themes: Inflation, Quality
Why Own Bonds in a Rising Rate Environment?
John Smet - Portfolio Manager at Capital Group
Wesley Phoa - Portfolio Manager at Capital Group
Portfolio manager John Smet discusses areas of opportunity he
Portfolio manager Wesley Phoa discusses reasons to own bonds in a
sees for fixed-income investors looking ahead into 2016.
rising rate environment in the context of investor objective.
22
1st Quarter 2016 www.assettv.com
REVIEW “OUR CONSISTENT APPROACH IN COMBINATION WITH THE CAPITAL SYSTEMS HAS RESULTED IN A SUPERIOR LONG-TERM TRACK RECORD.”
Opportunities in 2016 Amid Bumpy U.S. Recovery
Expect Tame Inflation for Foreseeable Future
Tim Armour - Portfolio Manager at Capital Group
Wesley Phoa - Portfolio Manager at Capital Group
American Funds portfolio manager Tim Armour discusses his outlook
Portfolio manager Wesley Phoa offers his outlook for inflation in the
for the U.S. economy and U.S. company growth.
U.S., for both the short and long term.
Capital Group Hiring Where the World Is Going
Could an Energy Rally Be Around the Corner?
Rob Lovelace - Portfolio Manager at Capital Group
Ted Samuels - Portfolio Manager at Capital Group
American Funds portfolio manager Rob Lovelace discusses the
Portfolio manager Ted Samuels discusses opportunities among oil
investment group’s approach to hiring new research associates.
companies today, given Saudi Arabia’s enforcement of supply-anddemand discipline over the global energy market.
VISIT THE AMERICAN FUNDS CHANNEL ON ASSETTV.COM WWW.ASSETTV.COM/CHANNEL/AMERICAN-FUNDS www.assettv.com 1st Quarter 2016 23
Videos available on the PULSE Channel
Conquering Market Fears through Education
The Virtue of Patience in Investing
David Edwards - President and Wealth Advisor for Heron Financial Group
David Mendels - Past-president and member of the New York Chapter of the FPA, of Creative Financial Concepts, LLC
David discusses the common concerns of investors amidst the
David Mendels offers some sage advice for investors and
current market down-turn, and explains how education and
comments on the unexpected nature of a volatile market.
information can help assuage most fears.
Inside the CFP Profession
What Should Advisors Look for in 2016
Cary Carbonaro - CFP Board Ambassador
Dave Dubendorfer - President, Artemis Wealth Advisors
Cary Carbonaro discusses the changing landscape of the
Dave Dubendorfer of Artemis Wealth Advisors sits down with Asset
financial advisory business and provides some current statistics
TV to discuss his outlook for 2016 and areas he recommends for his
within the profession.
clients as well as investment ideas to avoid.
24
1st Quarter 2016 www.assettv.com
REVIEW
Videos available on the ETFs Channel
New Liquidity Rules Mean Big Changes to ETFs
Demystifying Smart Beta for Advisors
David Breck - Managing Director for BNY Mellon
Anthony Davidow - Charles Schwab
David Breck shares his thoughts on the SEC’s proposed liquidity rules
The rapid rise in smart beta strategies left many advisors wondering
and the impact they will most likely have on ETFs.
how they can use these new products.
What Does the Future Hold for ETFs
WhitePaper: The Case for Dividend Quality
Deborah Fuhr - Managing Partner at ETFGI
FlexSharesÂŽ, Managed by Northern Trust
Deborah Fuhr discusses what the future holds for ETFs and where
In this recent environment of falling yields on bonds with interest
the sources of growth lie. Watch to find out how ETF issuers are
rates at or near zero, dividends are especially valued. That is when
using robo-advisors and expanding globally to capture more of
income-seeking investors start to include dividends in their search for
the expanding ETF market.
yield to meet their financial goals.
www.assettv.com 1st Quarter 2016 25
NEW LIVE TV INSERT STUDIO IN NEW YORK CITY VideoLink LLC, a full service video production company headquartered in Newton, Massachusetts, in partnership with Asset TV, a global video platform broadcasting exclusively for investment professionals, announced the opening of a live broadcast studio at the Asset TV Midtown studios in New York City, New York. The insert studio is powered by the VideoLink ReadyCam速 studio system. The ReadyCam transmits HD video and audio to broadcast and cable networks around the world, making live TV appearances a simple process. The networks schedule the studio and VideoLink operates it remotely. Experts are typically on-air within 20 minutes. Customers can also book the studio to costeffectively participate in remote events via webcast or record video for on-demand viewing.
To book the VideoLink Manhattan studio, contact VideoLink operations at 617-340-4300 or ops@videolinktv.com
26
1st Quarter 2016 www.assettv.com
Just Got Even Better! NEW MOBILE RESPONSIVE SITE NEW COMPANY CHANNELS NEW PROGRAM FORMATS NEW CE RECORDS NEW WHITEPAPERS AND BLOGS
VISIT ASSETTV.COM
Based on viewer feedback and technology development, assettv.com has a range of exciting new features, including: Video Delivery up to 1080p Resolution and HTTP Streaming - desktop, tablet and mobile Responsive Website Design - user friendly navigation New Company Channels - featuring leading industry experts Exciting New Program Formats - developed for research and education CE Statements and Viewer Profiles - adding value to the viewing experience Whitepapers and Blogs - new content formats available
VISIT ASSETTV.COM
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