The end of QE3...

Well, yesterday marked an important milestone as QE 3 was put to rest by Janet Yellen as she eliminated the final 15 billion per month in bond buying.  One would have thought that Treasury yields would have spiked dramatically after the announcement, but quite the opposite happened.  In fact, longer dated yields actually fell quite noticeably.  Even today, longer dated yields are continuing to go down.  With all the bond buying over the coarse of the last several years the supply has been diminished quite substantially.  So, even though the Fed for the better part of this year has been reducing there buying almost regularly it seems that due to supply and demand issues the prices have held firm.  It would have been very hard to predict that the 10-Year Treasury would touch 2.20% this year and never come close to 3%.  In addition, who would have thought that long term treasuries would be one of the best performing asset classes YTD.

A lot of people see the latest Fed statement yesterday as Hawkish, but I think Janet Yellen left her self enough wiggle room that if the data does not continue on an upward path she has the tools to step right back into some form of quantitative easing.  Also, the European Central Bank has firmly pledged to continue to support global markets and step up there efforts should they be needed.

As we finish the year markets have strong traditional seasonality on there side.  Where will we go from here now that the perception of the FED being out of the markets is here?  Well, that is a question not many people can answer.

Eric Marvin


Past Performance is no guarantee of future results.  Please consult with your own financial advisor before embarking on any investment plan.

More Volatility

What a week in the world of volatility!  The intraday moves in the Dow coming in as high as 600 points over the past several days.  Yesterday, there were some signs of capitulation as major selling took over from the open.  Certain sectors such as energy actually staged a late day comeback and is seeing some follow throw at the moment.  One thing that I took from yesterday is that the Russell 2000 held up quite well considering the move in the S&P 500.  During this pullback we have seen the small caps lead us to the downside, so it is important to take notice that they appear to be bottoming before the S&P 500.  If we can get a sustained bounce in energy we may be able to see a retest of around 1905 on the S&P, which would be at or around the 200 Day moving average.  What we would do from here might determine the short term direction of the market.  However, we may not even come close to getting back to this level assuming this is a head fake.


Eric Marvin


Past Performance is no guarantee of future results.  Please consult with your own financial advisor before embarking on any investment plan.

Monday Morning

Good Monday morning to everyone out there.  We are setting up a nice battleground today between the bulls and the bears in terms of who will be right vs. wrong.  The bears feel like they have to hold stocks below there 200 day Moving Average or else they might lose control back to the upside.  The bulls are still tentative to step in as last week was pretty brutal out there.  Usually, this leads to a tug-of-war price action in which we might trend sideways until there is a piece of news to give us that final push in either direction.  Historically, Options Expiration Week for the month of October is fairly bullish, but that is just one seasonal study.

My advice is to stay nimble in either direction and look for the 200 Day Moving Average to either hold or give way.  Volatility creates opportunities for those willing to take advantage.


Eric Marvin


Past performance is no guarantee of future results.  Please always consult your financial advisor with questions pertaining to your specific situation.

Wild Week

As this wild week comes to a close it is important to stay nimble and be ready to take action heading into next week.  We could see anything from a strong bounce to a continued sell off.  As I type this we are just below a pretty critical pivot point on the S&P 500, which would need to hold in order for us to see any bounce.  The longer we go without at least a snap back rally the higher the probability that we do indeed head lower in the near term.  Most people are looking around the 1905 level on the S&P, which is the 200-Day Moving Average.  It is important to note that we have only spent more time above the 200 Day two other times in history.  Yep, you heard it right.

Sectors are becoming heavily oversold, but that doesn't mean that they can't go lower.  The stock market is designed to frustrate the maximum amount of people whenever it can.

Eric Marvin


Past performance is no guarantee of future results.  Please always consult your financial advisor with questions pertaining to your specific situation.

Pay Attention

Yesterday's Fed Minutes are making my last post look pretty good about staying patient and waiting for the right opportunity.  It just goes to show you how we can go from having a bad morning to a fantastic afternoon.  The market really was surprised about how much the strength of the dollar was discussed between all the Fed Presidents.  Plain and simple, the market received confirmation on the perception this Fed remains willing and able to step up to the plate when needed.  This morning the 10-Year Yield is hitting lows not seen since the summer of 2013 under 2.3%.  What does this tell us? Well, so far the bond market has been moving higher on the confirmation that the announced bond buying will stop.  This is interesting if you stop and think about it as it really comes down to simple supply and demand.  Interestingly enough, all those purchases over the past several years have cut the supply sharply.  Now, you still have demand, but ironically enough a smaller supply.  I did pass Econ 101 and I know that when demand outstrips supply prices increase.

Keep an eye on the 10-Year as the bond market usually signals a potential market move before the stock market.  There were not too many people that thought this is where we would be with yields right now, but that is generally why you don't follow the crowd.

Do your own homework and understand your asset allocation.

If you would like help discussing your portfolio please give me a call at 239-288-6542.

Best,

Eric Marvin

Stay Patient

One of the hardest things to do as an investor is to remain patient when something is going against you.  This has been especially true for myself as an investment advisor this week as some of my core holdings have gotten sold like they are going out of business.  It truly reminds me of the saying of, "stocks take the elevator down and the stairs back up."  This time of the year is traditionally a little bumpy on a seasonality basis, but I think we may whether this storm and set up nicely for a year end rally of some kind.  Looking out even one month into the future is almost impossible when all you care about is the now.  The trick is to not get too caught up in the short term and still remain laser focused on accomplishing your goals.

Patience, Patience, Patience....

Eric Marvin

Controlled Volatility

Hello everyone!   Another day and another down leg in the markets today.  It seems like we have been bouncing around in every direction the last several trading sessions.  Last week, we hit support at the 150 Day Moving Average in the DJIA, which so far is continuing to hold up even though it is looking dicey at the moment.  Just like in previous sessions we made a bottom around 11:30 A.M. ET after the close in Europe.  This trend seems to be apparent when the volatility is higher than normal overseas, thus continuing over here.  There also appears to be a potential shift and rotation among sectors at the moment.  This can be a good thing and generally causes short term selling in the winners and buying in the laggards.  It is yet to be determined if the moving averages will hold and allow us to continue higher or if this is indeed the start of something more intense for the global markets.  There have been several strong seasonal studies that I have noticed over the course of the past few weeks, but again pay attention to the charts to get a clearer picture of the current environment.




Eric Marvin

Past performance is no guarantee of future results.  Please always consult your financial advisor with questions pertaining to your specific situation.

Always expect the unexpected

Watching the market unfold today reminded me to always expect the unexpected when dealing with stocks.  A popular and trendy tech company with direct ties to Apple declared Bankruptcy today after they failed to get there supply of product to the market.  It surprised the indexes quite a bit and several ETF's sold off as well due to there holding of the company.  Mr. Market does not make things easy for us and today is a perfect example of why it is so important to understand exactly what you own and how it can effect your overall portfolio.

With volatility picking up as we head into the end of the year it is paramount that you stick to your game plan to whether any potential storm that may be brewing ahead.  Volatility does not have to be bad.  In fact, it often provides for better opportunities for those willing to take advantage.  Feel free to contact me for info on how you to can take advantage of potential opportunities.

Eric Marvin
CEO of M&M Wealth Management, LLC

Human Emotions and Investing

One of the hardest things to do as an investor is to continue to stay the course of your financial plan during periods of increased stock market volatility.  Why?  Well, our human nature of fear comes out and starts to play tricks on us.  These may include not being able to look past a day, week, or even a month when times are bad.  You might be caught up looking at your account balance hourly and losing track of what you are trying to accomplish.  Fear causes us to make just as many bad decisions when it comes to our finances as greed.  However, greed on the flip side may cause us to hold onto a good thing for to long.  You have a winner in our portfolio and choose not to sell it because you think it is going to keep going higher.  Then, after it reverses course it is impossible for us to commit to selling it.  Why?  Simple, we want more.  Then even worse we sometimes let a winner turn into a loser and then only commit to selling when it gets back to break even.

I can remember back in 2008 when everyone at least here in Florida was ready to jump out of there one story windows... (joke) Flip back before that to 1999 and Financial Advisors were getting fired for not returning 100% with the latest technology sensation.

The fact of the matter is that individual investors have to become more like machines with there long term investment approach and less like humans with varying emotions.  This is obviously easier said than done, but nonetheless it should be something that we strive to achieve.

Stay safe out there and remember to investment less with emotions and more like a machine...


Eric Marvin, CFP®


Past performance is no guarantee of future results.  Please always consult your financial advisor with questions pertaining to your specific situation.

Important Things in Life

In this hectic world we live in today it is so easy to get bogged down with work and forget that sometimes we need to take a step back and appreciate the important things in life.  I took this advice to heart on Saturday as I took my two year old to Walt Disney World.  (The happiest place on earth!- no it really is...)  You should have seen her eyes when we walked in the gates of the Magic Kingdom and she saw the big castle in the background and everything decorated for Halloween!  For those several hours all my cares in the world vanished and I couldn't stop glowing as my daughter was the happiest that a little kid could get.  We went on Dumbo, then on the merry-go-round, then Little Mermaid, and off to take our pictures with Donald Duck and Goofy.

The trip ended with her picking up a nice stuffed animal of Olaf from Frozen, which she won't go to sleep without today...

Experiences like this make me more motivated than ever to keep helping my clients preserve and grow there wealth so they can spend more time on the "Important Things in Life."

If you would like a second opinion on your current financial situation I can be reached at emarvin@mandmwealth.com or 239-288-6542.

Best,


Eric M. Marvin, CFP®