Presentation on theme: "Wall Street’s On Fire: Ten Reasons to Move Your Money"— Presentation transcript:
1 Wall Street’s On Fire: Ten Reasons to Move Your Money
2 Contact information: Dave Vick Vick & Associates, Inc Vista Bonita Drive Suite 240 Scottsdale, AZ 85255 Disclaimer The Wall Street’s On Fire Workshop is an educational program, and is not intended to sell investment or insurance products, nor is it intended to provide tax or legal advice. Consult with your tax advisor and/or legal counsel for suitability for your specific situation. Hypothetical and/or actual historical returns contained in this presentation are for informational purposes only and are not intended to be an offer, solicitation, or recommendation. Rates of return are not guaranteed and are for illustrative purposes only. Projected rates do not reflect the actual or expected performance within any example or financial product. Dave Vick is an Investment Advisor Representative with Redhawk Wealth Advisors, an SEC Registered Investment Advisor. Insurance and annuity products are offered through Vick & Associates, Inc.
3 Ten Reasons to Move Money
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5 #1 What’s Coming Next? Market Cycle
6 #2 The Next Swing Down: A Little or A Lot
What the Heck Just Happened? Investing Paradigm Shifts Welcome to the M Times
7 #3 Watch the VIX (Fear Index)
VIX is high, it’s time to… BUY! VIX is low, it’s time to… GO! VIX - Sept ’ VIX - Aug ‘ VIX - Aug 14, ‘ VIX - Aug 24, ‘ VIX - Sept 28, ‘ Below 20 = Complacency Above 30 = Real Fear Go to YahooFinance and search for the VIX ( to find the latest numbers and insert
8 #3 Watch the Fear & Greed Index
Seven Fear & Greed Indicators: Market Volatility Junk Bond Demand Put & Call Options Safe Haven Demand Stock Price Breadth Stock Price Strength Market Momentum greed/ Go to to get the latest factors. As of 9/28/20155 Market Volatility Neutral The CBOE Volatility Index (VIX) is at This is a neutral reading and indicates that market risks appear low. Last changed Sep 1 from an Extreme Fear rating Updated Sep 28 at 11:17am Stock Price Strength Fear The number of stocks hitting 52-week lows exceeds the number hitting highs and is at the lower end of its range, indicating fear. Last changed Sep 18 from an Extreme Fear rating Stock Price Breadth Extreme Fear The McClellan Volume Summation Index measures advancing and declining volume on the NYSE. During the last month, approximately 17.74% more of each day's volume has traded in declining issues than in advancing issues, pushing this indicator towards the lower end of its range for the last two years. Last changed Sep 24 from a Fear rating Updated Sep 28 at 11:18am Safe Haven Demand Bonds have outperformed stocks by 5.32 percentage points during the last 20 trading days. This is close to the weakest performance for stocks relative to bonds in the past two years and indicates investors are fleeing risky stocks for the safety of bonds. Last changed Sep 24 from a Neutral rating Put and Call Options During the last five trading days, volume in put options has lagged volume in call options by 13.48% as investors make bullish bets in their portfolios. However, this is still among the highest levels of put buying seen during the last two years, indicating extreme fear on the part of investors. Last changed Sep 21 from a Fear rating Market Momentum The S&P 500 is 7.83% below its 125-day average. During the last two years, the S&P 500 has typically been above this average, so rapid declines like this indicate extreme levels of fear. Last changed Jul 22 from a Fear rating Junk Bond Demand Investors in low quality junk bonds are demanding 2.26 percentage points in additional yield over safer investment grade corporate bonds. This spread is much higher than what has been typical during the last two years and indicates that investors are highly risk averse. Last changed Sep 15 from a Fear rating Updated Sep 28 at 11:16am
9 #4 What Are Insiders Doing?
10 #5 Market Seasonality Could This Stock Market Indicator Point To TroubleAhead? Friday, 8 May :44 AM By Rob Russell For over the last three decades the markets have moved in an uncanny rhythm, creating somewhat of a predictable boom and bust cycle, at least through the lens of history. Consider this, we go through a fall/winter season about every 6-7 years followed by a spring/summer season. As you examine the past this ‘seasonality’ becomes more and more apparent. Also look at this article:
11 #5 Market Seasonality 1981 Market correction, then 6 years later…
1987 Black Monday, then 7 years later… 1994 Stocks + Bonds in negative territory (correlated losses), then 6 years later… 2000 Tech Bubble Bust, then 8 years later… 2008 The Great Recession, and now it’s 2015, 7 years later… The market has a way of humbling those that believe they’ve mastered the markets, it’s called the fall and winter ‘market seasons’ has signaled that we have effectively entered the fall ‘season’ in the markets… Will you be caught in your swimsuit when the next winter hits? Or will you be prepared?
12 #6 JACK BOGLE WARNS: Prepare For Two Massive Market Declines In The Next Decade Apr. 1, 2013 Bogle told CNBC… “But I also tell them they should expect at least a few 25 percent to 30 percent drops along the way, and maybe even a 50 percent drop in the coming decade.” “The market is going to do what it wants,” he explained. “So you’ve just got to keep a stiff upper lip.” JACK BOGLE WARNS: Prepare For Two Massive Market Declines In The Next Decade Matthew Boesler Apr. 1, 2013, 5:38 PM Read more: Jack Bogle is the founder and chairman of mutual-fund giant Vanguard Group and is widely credited for popularizing index funds, a staple for buy-and-hold investors. Today, he was on CNBC, and he had a bit of a startling prediction. CNBC anchor Scott Wapner put the question to Bogle: "You say, 'prepare for at least two declines of percent, maybe even 50 percent, in the coming decade.' For a buy-and-hold guy, that's a little concerning, don't you think?" Bogle replied: Not at all. They come and go. The market goes up, and the market goes down. It's never failed to recover from one of those 50 percent declines. I went through one in , I went through one in 2001, 2002, 2003; I went through another one They're kind of scary – often terrifying – but it's typical. Why it doesn't bother me is if you hang on through the cycle, that's the only way to invest. Trying to guess when it's going to go way up or way down is simply not a productive way to put your money to work. Bogle's comments don't represent any sort of shift in his philosophy – he remains as big a proponent of buy-and-hold investing as ever. Of course, if Bogle is right about two 50-percent declines in the next decade, it's going to be a trying experience for the buy-and-hold crowd. Read more:
13 #7 Playing with House Money
What system do you have to take your own money off the table and play with the market’s money? Or are you “all in” all the time? Like going to Vegas, determine how much of your retirement money you can’t afford to lose and don’t take it to Vegas with you. $100k? $300k? $500k? $750k?
14 #8 Retirement Income is the Cheapest It Ever Will Be – Right Now!
Increased Life Expectancy Leads to a Decrease in Payout Rates Posted on June 18, 2015 by IALC By Tom Hegna, CLU, ChFC, CASL Life Expectancy and Mortality Tables (2000 vs. 2014): Life Expectancy of a 65-Year-Old Male: 2000 Mortality Tables: 84.6 Years Old 2014 Mortality Tables: 86.6 Years Old 2.4% increase in life expectancy Life Expectancy of a 65-Year-Old Female: 2000 Mortality Tables: 86.4 Years Old 2014 Mortality Tables: 88.8 Years Old 2.8% increase in life expectancy “When payout rates for income annuities are released with the new mortality tables, you will see the payout rates drop because of an adjustment in longevity credits.” -Tom Hegna
15 #9 The Income Challenge Return $100k*0% 5 Yrs $________ 5% Withdrawal
Return $100k*7% 5 Yrs $________ 4% Withdrawal No Guarantees Return $100k*0% 5 Yrs $________ 5% Withdrawal Guaranteed Return $100k*4% 5 Yrs $________ 5% Withdrawal Guaranteed
16 #10 Freeing Up Retirement Assets
65 year old $1,000,000 4% WD Rate $40,000/yr Studies showing an ___%-___% Failure rate Free up $________ 65 year old $1,000,000 $________ 5.5% WD Rate $40,000/yr
17 The ABC Planning Model
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19 What is your greatest priority?
What are you willing to give up? _____ _____ _____? Cash Protective Growth Risk Growth Potentially higher returns Taxable or tax-deferred Offer partial withdrawals or liquid Potentially lower returns Taxable or tax-deferred Liquid Potentially moderate returns Tax-deferred Offer partial withdrawals _____________ _____________ _____________ _____________ _____________ _____________
20 GREEN Money Three Green Money Rules:
Rule #1: Protect Your Principal Rule #2: Protect Your Gains Rule #3: Protect Your Income
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22 RED Money Three Red Money Rules:
Rule #1: Must Be Tactical Rule #2: Must Be Liquid Rule #3: Must Be Long Term
23 What is Tactical Tacking or coming about is a sailing maneuver by which a sailing vessel (which is sailing approximately into the wind) turns its bow through the wind so that the direction from which the wind blows changes from one side to the other.
24 What if it happened again?
What if a bear market happens again? 1969 through 1978 the ABC model difference_______ What if a bear market happens again? 2000 through 2009 the ABC model difference_______
25 Top Ten Reasons Clients Should Move Money Today!
What’s _______ next? The Next Swing ______ Watch the _____ What are ______ doing? Market _________ ________ Warning. Playing with “_____ money.” Income is the _________ Now! The __________ Challenge _________ Up Money
26 You Probably Need a Sherpa
Trust ‘Likeability’ Competence Understands the _____ Longevity – are they going to be around when you need them? Need to work with someone that knows the terrain, longevity, you like and trust. What happens if you die or retire?...You find another advisor. What happens when your doctor dies? Plenty of ABC advisors all over the country. What is a client partner…go through the list of questions. If you advisor partners with you, you should partner with him…make his business a success. Talk him up. Now I hate asking for referrals and I don’t, but we have little get togethers, we are having one next week, come on down and bring some friends.
27 Everybody Has a “Pebble in the Shoe”
Everyone has at least one asset in their portfolio that either drives them crazy or needs protection! Everyone has at least one asset that drives them crazy. Which is it for you?
28 Thanks again for being with us today!
THANK YOU Thanks them for the evening and wish them well.
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