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| Shoreline Wealth & Investment Management |
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Newsletter
May 2005 |
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The Stock & Bond Markets -
"Sell in May and go away" goes the old Wall Street adage. A pretty depressing thought considering that 3 of the past 4 months have offered negative returns. The numbers, below, illustrating the seasonality approach are pretty compelling.
If an investor put $10,000 in the market on November 1st since 1950 and withdrew the entire balance on April 30th and continued this pattern annually, the value would have grown to more than $492,000.
If, instead, an investor put $10,000 in the market on May 1st and withdrew the entire balance on October 31st and continued this pattern annually, the value would have fallen to less than $9,700.
The economy has slowed to its lowest level in 2 years, thanks to higher energy prices and lower corporate earnings growth, pushing bond yields to their lowest levels in 11 wees. Even the "Oracle of Omaha" Warren Buffet said at his annual meeting this past Saturday that stocks are not at "bubble-type valuations or anywhere close to bargain valuations." This suggests a "backing and filling" period in which the market, excepting a catastrophe, is likely to trade sideways (and win no academy award nominations in the process).
CELEBRATING 25 YEARS
Since 1980, I have been providing financial advice to investors and I'm proud to say that our service and performance (see "Bottom Line" section on the right) continue to be superior to the market and our peers. Thanks for your support.
Real Estate Bubble? -
"People go crazy ... periodically. Residential housing has different behavioral characteristics simply because people live there. But when you get prices increasing faster than underlying costs, sometimes there can be pretty serious consequences that lend themselves to more explosive outcomes ... [if investors] all try to head for the exits at the same time. The only way you can leave your seat in burning financial markets is to find someone else to take your seat - and that's not always easy." (Warren Buffet, April 30, 2005). Loosely translated, buyer beware.
| Selecting an Advisor |
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 Warren Buffet, the most successful investor of the 20th century learned his craft from Benjamin Graham, author of several books including the legendary "Intelligent Investor." This has been recently updated by Jason Zweig who includes 16 key questions to ask your advisor and 11 an advisor might ask...
Read on... »
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| Understanding Stock Market Investing |
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 Stocks are one form of business ownership. Although most investors are owners of this investment category directly or through mutual funds, not everyone understands how they work (other than seeming to go down immediately after you buy them) or the "classes" of stock ownership.
Full Story »
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| Gifting: Disinheriting Uncle Sam |
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 There are many strategies for gifting, one of the many effective ways to transfer wealth before the government gets to share in the estate you have created.
Learn More »
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| Looking for a Speaker for Your Event? |
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 Shoreline Wealth & Investment Management has given presentations to Fortune 500 companies as well as many local groups and organizations. If you are looking for a professional presentation on topics ranging from investments to estate taxes to business or tax law, please contact us
Click here for more details »
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| The Bottom Line |
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| This is where we provide the performance of our conservative, moderate and aggressive portfolios and compare these to the S&P 500 and NASDAQ Indexes. While they are an important consideration, performance is only a portion of the evaluation investors should consider when evaluating investment management. Other considerations include the risk taken to generate the returns, the quality of the service, the reasonableness of the fees and, more important now than ever, the integrity of the investment manager.
Find out more.... |
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email: cbloom@cfiemail.com
voice: 805.886.3624
web: http://www.swimllc.com/
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Shoreline Wealth & Investment Management · 3905 State Street Suite 7173 · Santa Barbara · CA · 93105
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