Entries for December 2011

During moderate periods of inflation, equities tend to generate decent performance results. I posted the below chart in a post, Where To Invest In An Inflationary Environment, in mid 2010 that details the performance of various investment categories based on different inflation ranges going back to 1972.From The Blog of HORAN Capital AdvisorsSince mid year 2010 inflation has been trending higher with the latest year over year report showing inflation running at nearly 3.5%.From The Blog of HORAN...  Read more...

With the close of trading today, following is a quick look at the 2011 price performance of a few select equity markets around the globe.From The Blog of HORAN Capital AdvisorsSource: Reuters  Read more...

The investment mantra this year has been to focus on dividend paying stocks. Over the long run, payers have had a tendency to outperform the non payers and this has certainly been the case this year. On the other hand though, valuations do matter and the below chart provides investors with a cautionary view of simply buying "any" investment that has yield.From The Blog of HORAN Capital AdvisorsSource: South of Wall Street  Read more...

Recently, there was an important article by Carl Richards writing for the Blog, “Bucks,” in The New York Times. The article bears repeating. Equity investment results in the period between 2000 and 2010 were not so grim if investors prudently followed the wisdom of diversifying their portfolio. In this article, Mr. Richards outlines the performance of a broadly diversified portfolio of equity investments consisting of five asset classes: Large stocks (the S&P 500) Smal...  Read more...

Recent mutual fund flow data shows investors continue to favor bonds over equities.From The Blog of HORAN Capital AdvisorsFrom The Blog of HORAN Capital AdvisorsSource: ICIWith the sovereign debt issues in Europe top of mind for investors, they continue to bet the best of the worst fixed income investments are U.S. Treasuries. One risk investors face with fixed income investments is the negative impact of a rise in rates. The 10-year U.S. Treasury yield is a meager 1.85% in spite of the fact the...  Read more...

The improvement in the unemployment rate earlier this month was certainly positive on the surface. The rate declined to 8.6% from the previously reported 9%. The improvement though came largely from the 300,000 individuals that simply stopped looking for a job. As a result, these additional people are not counted among the unemployed. As the below chart shows, the number individuals not in the labor continues to rise.From The Blog of HORAN Capital AdvisorsThis fragile state of the consumer also ...  Read more...

Life Insurance products have developed and matured over time. Policies issued over the last 30-40 years respond positively and negatively to economic trends. In many cases, the policies developed by the insurance companies responded to an economic cycle that never really repeated.  Last year, my friend John Barry of the firm Barry, Evans, Josephs & Snipes in North Carolina developed the chart below illustrating two historical timelines. The upper time line outlines key m...  Read more...

Going forward S&P has changed the methodology on how they determine which companies qualify as Dividend Aristocrats. S&P notes they will only count regular dividend payments when determining the calendar year total dividend payments of a company. Special cash dividends will no longer be considered.The table below contains a list of Standard & Poor's Dividend Aristocrats for 2012. The rebalance will take place at the market's close on December 16, 2011. The green highlighted companies are the add...  Read more...

Much of the rhetoric coming out of Washington is focused on the need for more revenue, specifically from individual tax payers. The millionaire tax discussion is emblematic of this focus. As the below chart shows though, individual tax receipts into the U.S. Treasury are up 22% on a year over year basis through the end of September with overall receipts up nearly 7%.From The Blog of HORAN Capital AdvisorsAdditionally, individual receipts for the government are near the level received in 2007. On...  Read more...

Employers who help workers deal with financial stress are creating a healthier and more productive work environment. Employers are grappling with the high cost of health care. Many are encouraging employees to adopt healthy lifestyles to address the spiraling cost of health care – a very important step. But, employers should also recognize that a significant number of their employees are dealing with financial stress which can contribute to medical issues and lost productivity. T...  Read more...