April 17,
2017
The
Markets
And the survey said...
In late 2016, Natixis
Global surveyed 500 institutional decision makers representing corporate
pension plans, public pension plans, sovereign wealth funds, insurance
companies, foundations, and endowments. Survey participants said market
volatility, geopolitics, and interest rates were their top risk concerns for
2017.
So far, U.S. stock markets haven’t proven to be very
volatile, but geopolitics caused some disruption last week. Barron’s reported:
“Stocks fell 1 percent last week in quiet trading, with
many market participants out for religious observances. Worries about the war
in Syria, North Korean saber-rattling, and the coming French elections had
investors reining in riskier positions and heading for safe havens.
Real estate, utilities, and consumer-staples stocks were
the only sectors that rose last week. Financials – and banks in particular – fell,
despite strong earnings reports from the industry’s big kahunas.”
It was a tough week for stocks, but investors’ flight to
safety caused Treasury bonds to rally. Reuters
reported the interest rate on 10-year Treasury notes fell 14 basis points.
That’s the biggest weekly decline since January 2016. (There is an inverse
relationship between bond interest rates and bond prices. When interest rates
fall, bond prices rise, and vice-versa.)
Data as of 4/14/17
|
1-Week
|
Y-T-D
|
1-Year
|
3-Year
|
5-Year
|
10-Year
|
|
Standard & Poor's 500 (Domestic Stocks)
|
-1.1%
|
4.0%
|
11.8%
|
8.1%
|
11.2%
|
4.8%
|
|
Dow Jones Global ex-U.S.
|
-0.2
|
6.7
|
8.8
|
-1.2
|
2.9
|
-1.3
|
|
10-year Treasury Note (Yield Only)
|
2.2
|
N/A
|
1.8
|
2.6
|
2.0
|
4.8
|
|
Gold (per ounce)
|
1.4
|
10.8
|
3.1
|
-1.1
|
-5.1
|
6.5
|
|
Bloomberg Commodity Index
|
0.5
|
-1.4
|
6.2
|
-14.4
|
-9.4
|
-6.8
|
|
DJ Equity All REIT Total Return Index
|
0.9
|
4.4
|
7.4
|
11.3
|
11.2
|
5.1
|
S&P 500, Dow Jones Global ex-US, Gold,
Bloomberg Commodity Index returns exclude reinvested dividends (gold does not
pay a dividend) and the three-, five-, and 10-year returns are annualized; the
DJ Equity All REIT Total Return Index does include reinvested dividends and the
three-, five-, and 10-year returns are annualized; and the 10-year Treasury
Note is simply the yield at the close of the day on each of the historical time
periods. Sources: Yahoo! Finance, Barron’s, djindexes.com, London Bullion
Market Association. Past performance is no guarantee of future
results. Indices are unmanaged and cannot be invested into directly. N/A means
not applicable.
why do shoelaces come untied? Engineers have solved many knotty
problems, but it wasn’t until recently they unraveled the mystery of shoelaces
and why they come undone, reported The Economist.
If you don’t wear shoes that lace or spend time with young
child who wear lace-ups, you may not have realized how vexing shoelaces can be.
Traditional shoelace bows are comprised of a reef knot and a slipknot – a
combination that has come undone throughout history. People have explored
alternative knots. In fact, there is an entire website devoted to shoelace
knots. It details regular, secure, and special purpose options.
As it turns out, the problem with shoelaces is walking. A
group of engineers at the University of California, Berkeley worked out the
mechanics of shoelace-bow destruction using treadmills, cameras, and tiny
accelerometers. The Economist
reported:
“The first thing which happens during walking is that the
reef itself is loosened by the inertial forces of the lace ends pulling on it.
This occurs as a walker’s foot moves first forward and then backward as it hits
the ground during a stride. Immediately after that, the shock of impact
distorts the reef still further. The combination of pull and distortion loosens
the reef’s grip on the lace, permitting it to slip…Probably; nothing can be
done about this differential elongation. But it might be possible to use the
insights [researchers] have provided to create laces that restrict the distortion
of the reef at a bow’s center and, thus, slow the whole process down.”
Could this research win an Ig Nobel in
2017? It’s possible.
You may recall
from previous commentaries, the ‘Igs’ celebrate improbable research and “…honor
achievements that first make people laugh, and then make them think. The prizes
are intended to celebrate the unusual, honor the imaginative – and spur
people's interest in science, medicine, and technology.”
The 27th First Annual Ig Nobel Prize
ceremony will take place September 14, 2017.
Weekly
Focus – Think About It
“I
put a dollar in one of those change machines. Nothing changed.”
--George Carlin, Comedian
Best
regards,
Womack Investment Advisers, Inc.
WOMACK
INVESTMENT ADVISERS, INC.
Oklahoma / Main Office: 1366 E. 15th Street - Edmond, OK 73013
California Office: 4660 La Jolla Village Dr., Ste. 500 - San Diego, CA 92122
Phone (405) 340-1717 - Toll Free (877) 340-1717
Oklahoma / Main Office: 1366 E. 15th Street - Edmond, OK 73013
California Office: 4660 La Jolla Village Dr., Ste. 500 - San Diego, CA 92122
Phone (405) 340-1717 - Toll Free (877) 340-1717
Website: www.womackadvisers.com
P.S. Please feel
free to forward this commentary to family, friends, or colleagues. If you would
like us to add them to the list, please reply to this e-mail with their e-mail
address and we will ask for their permission to be added.
* These views are those of Peak Advisor
Alliance, and not the presenting Representative or the Representative’s
Broker/Dealer, and should not be construed as investment advice.
* This newsletter was prepared by Peak
Advisor Alliance. Peak Advisor Alliance is not affiliated with the named
broker/dealer.
* Government bonds and Treasury Bills are
guaranteed by the U.S. government as to the timely payment of principal and
interest and, if held to maturity, offer a fixed rate of return and fixed
principal value. However, the value of
fund shares is not guaranteed and will fluctuate.
* Corporate bonds are considered higher risk
than government bonds but normally offer a higher yield and are subject to
market, interest rate and credit risk as well as additional risks based on the
quality of issuer coupon rate, price, yield, maturity, and redemption features.
* The Standard & Poor's 500 (S&P 500)
is an unmanaged group of securities considered to be representative of the
stock market in general. You cannot invest directly in this index.
* All indices referenced are unmanaged.
Unmanaged index returns do not reflect fees, expenses, or sales charges. Index
performance is not indicative of the performance of any investment.
* The Dow Jones Global ex-U.S. Index covers
approximately 95% of the market capitalization of the 45 developed and emerging
countries included in the Index.
* The 10-year Treasury Note represents debt
owed by the United States Treasury to the public. Since the U.S. Government is
seen as a risk-free borrower, investors use the 10-year Treasury Note as a
benchmark for the long-term bond market.
* Gold represents the afternoon gold price as
reported by the London Bullion Market Association. The gold price is set twice
daily by the London Gold Fixing Company at 10:30 and 15:00 and is expressed in
U.S. dollars per fine troy ounce.
* The Bloomberg Commodity Index is designed
to be a highly liquid and diversified benchmark for the commodity futures
market. The Index is composed of futures contracts on 19 physical commodities
and was launched on July 14, 1998.
* The DJ Equity All REIT Total Return Index
measures the total return performance of the equity subcategory of the Real
Estate Investment Trust (REIT) industry as calculated by Dow Jones.
* Yahoo! Finance is the source for any
reference to the performance of an index between two specific periods.
* Opinions expressed are subject to change
without notice and are not intended as investment advice or to predict future
performance.
* Economic forecasts set forth may not
develop as predicted and there can be no guarantee that strategies promoted
will be successful.
* Past performance does not guarantee future
results. Investing involves risk, including loss of principal.
* You cannot invest directly in an index.
* Consult your financial professional before
making any investment decision.
* Stock investing involves risk including
loss of principal.
*
To unsubscribe from the Womack Weekly Commentary please reply to this e-mail
with “Unsubscribe” in the subject line, or write us at raegan@womackadvisers.com
Sources:
http://www.barrons.com/articles/stocks-slip-1-on-week-as-geopolitical-worries-grow-1492229480?mod=BOL_hp_we_columns (or go to https://s3-us-west-2.amazonaws.com/peakcontent/+Peak+Commentary/04-17-17_Barrons-Stocks_Slip_1_Percent_on_Week_as_Geopolitical_Worries_Grow-Footnote_2.pdf)
http://www.economist.com/news/science-and-technology/21720610-three-californian-engineers-have-found-out-answer-knotty-problem-how (or go to https://s3-us-west-2.amazonaws.com/peakcontent/+Peak+Commentary/04-17-17_TheEconomist-How_Shoelaces_Come_Undone-Footnote_5.pdf)
Comments
Post a Comment