Showing posts tagged bonds

Is The Currency War Helping Exports | Ed Butowsky (by Ed Butowsky)

Oil Prices Plunge On New Worries About Global Economy

Oil prices have not been this low since last October (2011). Oil plunged below $90 a barrel ($89.90/bbl), down $1.95 just yesterday, on new worries about Europe’s mess and how it will slow down the global economy. Oil prices are down more than 14% in just May 2012 alone. Ed Butowsky, wealth manager, financial advisor, and managing partner of Chapwood Investment Management, joins Fox News’ Your World with Neil Cavuto to discuss how the impact of falling oil prices could help boost the economy.


Ed Butowsky is the managing partner of Chapwood Investment Management and is an internationally recognized expert in the investment wealth management industry. Ed is also a frequent guest on other networks such as CNN, NBC, ABC, Fox News, Fox Business, and Bloomberg to name a few.

Original Article

Ed Butowsky Explains Why You Should Consider Selling Bonds

Countless investors are unaware that they can easily sell their bonds prior to maturity and secure a profit today … And investors today wonder why their advisers steer clear of any discussions of the sort.

via Ed Butowsky Explains Why You Should Consider Selling Bonds.

Ed Butowsky Explains Why You Should Consider Selling Bonds

Many investors are unaware that they can sell their bonds before maturity and secure a profit today. Most financial advisers, however, typically avoid any conversation about selling bond investments.

Because of the sluggish economy over the last three years, interest rates have dropped to historically low levels. When rate drop, bond prices rise, which is why investors have large unrealized gains on their bond holdings.

Conversely, when interest rates rise, bond prices drop. Interest rates are starting to creep higher, and as they do investors will see these unrealized gains evaporate.

Most bonds are selling above the par value, which is the amount investors receive at maturity. for example, many $100 par value bonds are currently priced between $104 and $110. As the maturity date gets closer though, the value of these bonds will drop toward their par value.

Millions of dollars in profits are currently embedded in interest-rate-sensitive bonds. Savvy investors should consider selling some of their bond holdings and take the profit while they still can.

Ed Butowsky is the managing partner of Chapwood Investment Management and is an internationally recognized expert in the investment wealth management industry for over 25 years. Check out Ed’s discussion topics for a quick tip or two for your own financial well-being in his Media Center or follow Ed Butowsky on Facebook.

Watch Interest, Earnings

Many investors are wondering why stocks continue to move higher even as the economic picture looks weak.

To understand this, investors need to understand the thinking of professional money managers, who account for 93 percent of the volume of the stock market.

They control the ups and downs of the market that we observe every day. Currently, the consensus among money managers is that stocks are 2.5 times more attractive than bonds.

This position is based on the assumption that, by their calculation, stocks are 15 percent undervalued based on expected earnings over the next year. Bonds, on the other hand, are 20 percent overvalued.

However, if interest rates start to rise and earnings growth slows , the undervaluation of stocks could quickly reverse, and we could see a major sell-off in the stock market.

So be happy that stocks are going higher today, but keep a close eye on earnings and interest rates. They’re your friend today, but tomorrow they might be your enemy.

Ed Butowsky is the managing partner of Chapwood Investment Management and is an internationally recognized expert in the investment wealth management industry for over 22 years. Check out Ed’s discussion topics for a quick tip or two for your own financial well-being in his Media Center or follow Ed Butowsky on Facebook.

Buy Stocks, Exit Bonds

I have what I believe are some investment recommendations for the New Year.

These recommendations are for anybody with an investment horizon of two years or longer. Based on the current economic environment and historically low interest rates, investors should strongly favor stocks over bonds.

Stocks are currently 21 percent undervalued based on expected earnings next year. I recommend investing 30 percent of a portfolio in a large-cap stocks that pay dividends, 10 percent in large-cap growth stocks, 15 percent in utilities, 10 percent in emerging markets, 10 percent in small-cap value, 10 percent in gold and silver, and the rest in a other alternatives.

I would recommend selling any bond mutual funds that may be sensitive to rising interest rates. Investors holding fixed-income investments ma truing in five years or longer are risking their principal.

Remember that when interest rates rise, longer-maturity bonds are hurt more than shorter-maturity bonds. It is only a matter of time before interest rates spike higher.

I think 2012 will be a good year for domestic stocks but a bad one for bonds. Those afraid of market volatility should remain in money market funds.

Where To Stash All That Cash

Ed Butowsky on the Willis Report 12-7-11

Investors tend to flock to US treasury bonds during rough economic times. However, many economist including Ed believe this to be the wrong investment. So where should investors invest their cash, Ed Butowsky, wealth manager, financial advisor, and managing partner of Chapwood Investment Management, joins Fox Business’ The Willis Report to discuss where investors should be investing and why the bond market is not a good place for your money when interest rates start to rise.

Ed Butowsky is the managing partner of Chapwood Investment Management and is an internationally recognized expert in the investment wealth management industry. Ed is also a frequent guest on other networks such as CNN, NBC, ABC, Fox News, Fox Business, and Bloomberg to name a few.

Ed Butowsky Joins The Company 11-21-11

Ed Butowsky, wealth manager, financial advisor, and managing partner of Chapwood Investment Management, joins the company on Fox Business’ Varney & Co to discuss various topics ranging from treasury bonds to Apple iPhones.


Ed Butowsky is the managing partner of Chapwood Investment Management and is an internationally recognized expert in the investment wealth management industry. Ed is also a frequent guest on other networks such as CNN, NBC, ABC, Fox News, Fox Business, and Bloomberg to name a few.
 

Preparing For Inflation

We focus quite a bit in this country on the amount of money the government is printing to artificially stimulate and support our economy.

This is a potentially devastating practice, and one that will soon trigger rising inflation. Undoubtedly, Europe will also have to engage in the same kind of artificial money creation to prop up its sluggish economy.

Investors should be forewarned that rising inflation will affect their cost of living and erode the value of their portfolios. With so much excess money sloshing around, I believe we will see dramatic inflationary and cost-of-living spikes in 2012.

To counter this, savvy investors should own stocks, not bonds. Bonds will be particularly vulnerable in a rising interest rate environment. I would suggest that investors focus on commodity and energy-related stocks. Two of my favorites in these categories are Market Vectors Agribusiness and iShares Dow Jones U.S. Energy.

Ed Butowsky is the managing partner of Chapwood Investment Management and is an internationally recognized expert in the investment wealth management industry for over 22 years. Check out Ed’s discussion topics for a quick tip or two for your own financial well-being in his Media Center or follow Ed Butowsky on Facebook.

Are European Debt Concerns Making Bonds A Better Bet?


As European markets remain on shaky grounds it appears that investors continually gravitate towards bonds. However, are bonds the right thing to invest in? Ed Butowsky, wealth manager, financial advisor, and managing partner of Chapwood Investment Management, joins Fox Business’ Varney & Co. to discuss what to watch out for with government bonds and whether they seem like a sound investment.

Ed Butowsky is the managing partner of Chapwood Investment Management and is an internationally recognized expert in the investment wealth management industry. Ed is also a frequent guest on other networks such as CNN, NBC, ABC, Fox News, Fox Business, and Bloomberg to name a few.
 
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