FINSUM + Magnifi: Why Gold is in for a Tough Year
(January 2021)
Gold had a very strong 2020 as investors feared chaos from the pandemic. However, 2021 looks likely to be a weak year for the metal. The reason why has to do with reflation. Everything the new Biden administration is planning to do (or not do) is part of an effort to reflate the economy. Whether that means the nearly $2 tn stimulus package that will be primarily directed to low income households, or new Treasury chief Yellen’s commitment to not intentionally weakening the US Dollar. All of this poses a major headwind to gold, as the metal yields nothing and will suffer as rates moves higher on creeping inflation.
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FINSUM + Magnifi: Goldman Publishes a Crucial Call on the S&P 500
(January 2021)
The market has been a bit choppy to start the year, including a loss over the last five days. The weakness of last week came as somewhat of surprise to investors as Biden announced that a nearly $2 tn stimulus package was in the works. That said, Goldman Sachs is undeterred in their view of the economy. In fact, it is exactly their view of the economy that drives their forecast. The bank put out a report last week that calls for a 14% gain in the S&P 500 this year. The reason why is that Goldman believes there is going to be GDP growth of 6.4% this year compared to a consensus estimate of 4.2%. Alongside this expansion, the bank thinks earnings per share will spike by 31% compared to a decline of 17% in 2020.
Source: Market Watch
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FINSUM + Magnifi: Munis Still Look Attractive
(January 2021)
Advisors don’t need to be told that rates are at ultra-low levels. Yet despite this, munis are still maintaining their attractiveness. Muni issuance was at a recent high in 2020 (the highest level since 2013) with $3.9 tn outstanding. The reason why is that many municipalities have been seeing budget shortfalls because of COVID. Despite the big jump in issuance, demand has kept pace, with investors gobbling up as much as municipalities can issue. Demand has started well this year too, with muni ETFs seeing gains.
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Blending a Finance Background with the Latest Tech Stack: A Conversation with Magnifi CPO Tom Van Horn
Blending a Finance Background with the Latest Tech Stack: A Conversation with Magnifi CPO Tom Van Horn
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How Magnifi Can Enhance Client Portfolios
What if you had a simple-to-use, advanced tool that guided you in giving every client portfolio an edge in an evidenced-based and systematic way? With Magnifi’s Enhancer feature, you do.
Magnifi’s Enhancer tool allows advisors to adjust existing accounts either at the fund level or by comparing them with model portfolios based on user-specified factors.
FINSUM + Magnifi: Why the Biden Administration May Be Bad for Gold
(January 2021)
Gold has been hurting recently, with prices currently around $1,800 after some strong gains over the course of 2020. The big question is where gold is headed now that the vaccine is rolling out and a new administration is coming in. The bottom line is that the Biden administration may pose some difficulties for gold. The reason why is that Biden is planning a multi-trillion Dollar stimulus package that could boost inflation. Gold generally falls as rates rise because of its zero yields. Therefore, the administration’s plans for ongoing stimulus—which will boost the cash flowing into the economy—are a net negative for the metal.
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FINSUM + Magnifi: Would an Apple Car Disrupt Autos like the iPhone Did to Tech?
(January 2021)
The Apple Car (capital C!) has been hyped all over the internet over the last year, and investors seem to be frothing over the idea. The company has a long history of disruption—first it was computers, then phones—so many are excited by the prospects of an Apple Car. It may be a long way off, but its effects on the market would likely be felt years before its release. JP Morgan recently did a deep dive into what an Apple Car would mean for the market. One key point they made is that Apple is unlikely to build its own cars in its own plants. Rather, it would likely outsource manufacturing to existing car companies, much like it does with its iPhone. This would generally be positive for the industry as it would spread the wealth around rather than Apple just stealing all market share from existing players.
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FINSUM + Magnifi: The SEC May Make Big Changes to the Muni Market
(January 2021)
One of the big risks to the muni sector that has gone under-appreciated by the financial media and investing community is the threat of the soon-to-be revamped SEC making some big changes to the asset class. The reason for concern is that Elad Roisman was recently appointed interim chief of the SEC. Roisman has long had a focus on transparency in fixed income markets, which he and others at the SEC feel is too opaque. This has raised the risk of new regulation in the space. That said, his short tenure before likely being replaced by Biden will limit his time frame to change any policy.
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How Magnifi Answers Common Investment Management Questions
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