The DJIA has seen a slight increase today by 0.83% (refer to snapshot details above) and for those who hold index funds the performance most likely correlates with your portfolio. News of coronavirus mitigation and various private sector PPE production may be the cause for this market shift. However, the markets have been wildly unpredictable since the outbreak of the virus and the financial markets do not mirror the current global economic outlook. Refer to my quote from today’s Facebook group, ‘Fidelity Investing’ on holding for the long-term.
The economic U-shaped recovery ideology holds true as we continue to live in bear market territory. Many investment management companies advise the purchasing of shares at a lower bid price than typical market territory. I plan on continuing my purchasing schedule and sticking to my asset allocation of 70% domestic stock and 30% domestic bonds. My most recent buy in was FTEC at $61.88, this ETF checks off all of my buy in boxes – Historical Return, Dividend Yield, Beta, Expense Ratio, and Holdings Analysis.
Today’s Quote: ”The idea that a bell rings to signal when investors should get into or out of the market is simply not credible. After nearly 50 years in this business I do not know of anybody who has done it successfully and consistently.” – Jack Bogle, Founder of The Vanguard Group
Fidelity Investments offer both a free trading platform and a wide range of mutual funds, ETFs, and fixed-income offerings. If you read the investing category of my blog it is clear that I invest heavily in ETFs due to the diverse array of holdings. If a certain company has a bad quarter there are at least a dozen others that can balance out the losses.
A solid amount of Fidelity ETFs produce strong historical performance with 5-year returns favorable to the long-term investor. Dividend yield is another bonus that comes with ETFs as they are almost always guaranteed to be consistent payouts.
Here are eight Fidelity ETFs to choose from with favorable analysis 📈
What I look for when investing in ETFs:
ETF Holdings Analysis
Beta (5Y Monthly)
Feel free to join my Facebook group ‘Fidelity Investing’ to be a part of a growing investors community where we share insights and news on financial markets and fidelity funds.
This group is for Fidelity Investment clients and fans. This page is not affiliated with Fidelity Investments rather a client-based group of insight discussions and financial news. All securities & financial markets may be discussed, and please remember to use the stock or fund symbol.
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1. Post fund symbol with each post
2. Sharing blogs and analysis is allowed.
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Feel free to ask me questions,
Michael C. Moran
From a young age I was destined to be an entrepreneur and business enthusiast. I always had a sense of organization clarity, direction, and purpose that I was naturally seeking to fulfill. Stock Trading was something that seemed appealing on the outside and almost a lifestyle choice when I saw it as an 18 year old. It wasn’t until the summer of my freshman year in college where my interests really began to peak. I was bored, eager, and ready for the next level.
I remember the spring semester walks to the Haworth College of Business my Freshman year at WMU where the stock tickers were present in the center of the college at the Greenleaf Trust Trading Room. It really confirmed my love for the stock market and learning more about investing in my spare time. From there I majored in sales and business marketing to gain more professional experience and corporate presence, however kept my studies in business very broad.
I remember hearing that the Greenleaf Trust Trading Room was installed as a collaborative unit within the Haworth College of Business in 2014. The Robert J. Kaiser Sales Lab was installed in 2018 my senior year. I remember thinking how amazing and new it looked as my business career began. A teenager full of enthusiasm and nativity, little did I know where I could take my career.
The summer of my freshman year I was looking for work in business and at the very least to learn something valuable about business that I could take into what was ahead. That turned out to be learning about stock trading and long-term investment research. It was the most intriguing thing to me that you could own equity in a company through individual shares.
I will admit that at times when I should have been studying during the semester I was researching financial markets and discussing these topics with like-minded individuals at WMU. Looking back I have determined that certain subjects peaked my interest which I could easily relate to public financial markets.
My father always told me to save 10% of my earnings after debts are paid off. So a portion of that 10% goes into my short-term savings and the other percentage of the funds go into my Roth IRA. This allows me to ‘pay myself first’ which is a core principle in my personal finance and investing strategy. I discuss more on this principle in my blog post 7 Basics to Personal Finance: Millennial & Gen X Edition.
When you have the freedom to invest real funds into the stock market that’s when the fun begins for most with myself included. When I was a freshman I had saved up enough money from my window cleaning job to begin investing in the E-Trade platform I was using (Options House at the time).
My first step was opening a trading platform and transferring money into the brokerage account from my bank account. I then browsed the dashboard and explored the suggested markets overview and watch list options. My father was knowledgeable on the basics of stock trading and had a retirement account set up long ago, however he was not interested in the analysis during his free time.
We both had access to the account and our first step was developing a watch list. This consisted of researching familiar fortune 100 companies or as I like to call them ‘sexy stocks’. Buying shares of Ford, popular casinos and random pharmaceutical companies was the result of my watch list exploratory tirade. The result was losses in the market via negative returns and one pharmaceutical start up even went out of busiuness. There was no plan just a pot of $300 to see what the stock market was.
Fast forward to the year 2020 I have 5 years experience in the stock market and a Roth IRA set up for my retirement. I have done consistent and extensive financial markets research to understand a conceptual and detailed view. I have drafted and created an investment strategy for the individual investment account I operate, called ‘The Main Fund’.
Essentially this consists of a strict asset allocation between equities (stocks) and bond offerings. No matter the market movement my investments stay true to the asset allocation and I follow my #1 rule which is holding for the long-term capital appreciation and dividends.
I’ll leave you with this quote from the famous CEO of Vanguard Jack Bogle, “”The idea that a bell rings to signal when investors should get into or out of the market is simply not credible. After nearly 50 years in this business I do not know of anybody who has done it successfully and consistently.”
Thanks For Reading,
Most people aren’t fully aware of the scale in the ‘bond market’, of which bonds issued in various public financial markets exist in the United States and internationally. The famous government issued savings bond is typically the first piece of information that the general population thinks of when the subject of CDs or bonds arises in conversation. The truth is that the bond market is much larger and more complex than the face value savings bonds issued by the U.S government. For every municipality and governing body as a whole, comes the opportunity to invest in fixed return bond projects. The bond market is often overlooked as many advanced investors heavily promote equity trading.
The 1900’s were the time of the savings bond and it was viewed as a safe and responsible investment for the long-term. It wasn’t until the 21st century that savings bonds significantly decreased in face value and more individuals in the U.S. began cashing out their savings bond without purchasing another government issued savings bond. Today there are many government issued options for bonds with low to average yield rates. The shift in focus is to ‘bond funds’ in public markets such as exchange traded bond funds (ETF Bond Funds).
The current fixed income sectors are strong and major investment institutions are capitalizing on a diverse array of public and privately issued bond funds. Keep in mind, these markets are not 100% fixed because private corporations are also issuing bonds called ‘corporate bonds’ which are not government backed and are valued based on rating. Modern day bond rating establishments such as Moody’s and Standard & Poor’s place a rating on an A-D + or – scale. The rating classifications are as follows:
- Investment Grade Bond
- Non-Investment Grade
- High Yield/Junk Bonds (Weakest)
Investment grade bonds contain the strongest rating and have the least chance of folding which is the main reason why many investors balance out their portfolios with a series of investment grade bonds. On the complete opposite end of the spectrum are high yield or also known as ‘junk bonds’. These bonds have the weakest rating and are considered a risky investment with a increased chance of default, however the yield offered on these issued bonds are the highest.
Now you have an understanding of the various types of bond ratings, it’s time to explore further into the broad range of bond classifications and segments within the fixed-income markets. There are many different forms of issued bonds and this largely is based on the type of issuer at hand. Below is a list of bond issuer types:
- Municipal Bonds
- Corporate Bonds
- High Yield Bonds
- Savings Bonds
Municipal bonds are a form of ‘debt security’ issued by public municipalities to finance major capital expenditures such as roads, schools, and highways. Municipal bonds otherwise known as “muni bonds” are exempt of taxation at most levels, making them a safe and trustworthy investment. To put municipal bonds in real terms, one may think of it as loaning money to the government for a fixed rate of return.
Corporate bonds differ from municipal bonds in terms of the issuing party. These bonds are issued by corporations, hence the name ‘corporate’ bonds. The goal of this bond is for the corporation to pay investors from future operations earnings, and the interest rates on these bonds are higher due to the increased perceived risk. In some cases corporate bonds may be backed by a corporations assets.
High yield bonds are higher paying bonds with a lower credit rating than corporate bonds, treasury bonds, and municipal bonds. The yield is much higher than other classifications of bonds due to the increased risk of defaulting. These bonds are also known as “junk bonds”.
U.S. Savings bonds are government issued bond that offers a fixed rate of interest return over a fixed period of time. These were popular in the early-mid to late 1900s and were initially issued during the great depression and world war II. United States savings bonds have been used to raise capital for public projects and the military. In modern times investors have shifted to other bond classifications with higher rates of return.
Now you have an intermediate understanding of the bond market and the various classifications of them. Keep this information as a basis for your bond investment strategy, and keep in mind that municipal bonds are the safest investment out of all bond funds available on publicly traded markets. Savings bonds are usually not included in index bond funds rather issued directly from the government, and are even safer yet have a lower return rate. All of these determinations will unfold as you begin diversifying your bond investments, and as with most things in life you learn as you go.
Thanks for reading,
Managing Partner @ IHG Management
Finally feeling ready to make your first public stock trade? Maybe you are brand new to stock trading and just read our previous blog on how to get started, or perhaps you carry an advanced set of skills. No matter your status in the trade (pun intended) this blog contains access to free trading software to save you costs and grow your returns in the long-run!
OK, so you want to start ‘trading stocks’ and earning a ton of money in the stock market. Sound like you? Great, this is exactly where my aspirations started as a young freshman business college student in 2015. The question most people ask themselves is “how fast and easy am I able to make significant return profits in the stock exchange market?”. The way I started was typical of any new investor, buying individual stocks of companies that ‘looked cool’ and seemed reputable enough at the time to purchase shares.
It is far more lucrative in building a solid foundation of knowledge to begin understanding the metrics and history of the stock market. It is better to be prepared than to blindly trade a lose money and time. Learning the hard way can be helpful, however it is advised to follow the more sensible path available to you.
The first thing to realize is the simple fact that it will take patience, strategy, and key decision making in order to make long-term profits in the stock market. If you are able to accept these conditions and roll with your strategy, then trading equities and other financial instruments may be a rewarding and lucrative path to take. It will take more willingness to learn than simply looking up the Dow Jones once or twice. I will explain 4 steps to getting started trading equities, these helped my portfolio and watch list take off in to hyper drive. Not to mention sharpened my skills for what was ahead.
- Understand the Foundations of Stock Trading
The first step to take is researching the basics of issued shares, the share price, trading cycle, and how the market generally operates. A share is an issued stock of a company that a privately owned company or government sector issues to the public. For example, let’s take a look at apple stock (aapl), the share price was $315.67, meaning that the current value of one share of stock ownership in the company currently was worth $315.67 at that point in time.
Now that you own a share of a company, what dictates the share price? What influences the price moving up and down? Very simply stated, the market and willingness to pay dictates the share price. As demand for stock ownership increases the share price goes up. When a company is performing poorly and shareholders begin dumping stock, the share price goes down because consumers are willing to pay less for shares due to poor company performance and/or other factors.
- Open a Trading Platform Account
After grasping a basic understanding of the stock market, it is time to put your portfolio on the map and execute your very first trade. Before you can do this you need what is called a ‘Trading Platform’. This will provide you the basis to the buy and sell shares along with other access to financial instruments (for advanced traders).
If you are a beginner in equities trading you will be better served with a trading platform that has $0 trading fees! Yes, there are no fees when executing trades (typically $3-4 to execute with an advanced platform). The insights on this platform won’t be as advanced, but hey the internet has all of this information anyway. I got started with ‘Robinhood’ a free trading platform with $0 trading fees. Here is a link to get started with Robinhood and gain access to easy to use trading. By using my link below you will receive a FREE STOCK when starting. This can be held for long-term gains or sold for immediate cash. Link Below
- Develop Your Portfolio Watch list
Now you are ready to begin your investment career! At this point you probably want to start buying shares of your favorite ‘big time’ companies (Apple, Ford, Disney, etc.). Don’t get ahead of yourself like I did when I first started out. There is far more growth value in playing the slow and pragmatic approach than to trade instant gratification stocks. Please note an example bond oriented portfolio watchlist on the ‘Firstrade’ platform, another excellent commission-free trading platform:
My trading strategy was non-existent, I began with stock purchases of GE, Casino Companies, and a pharmaceutical company that ended up tanking. No research, no strategy, no watch list, no restrictions, simply buying what ‘looked cool’. My returns on the limited funds I had invested were trash. It was a learning experience nonetheless. Now that you have read a real life example of this, please take the pragmatic path and plan what genre of equities and financial instruments you plan on trading.
- Play the Long-Term Game as a Beginner
Many people aim to earn quick and easy returns in the market without the necessary planning/work. Short-term returns are found in financial instruments however are subject to extreme risk and many advanced executives have taken just as many big losses as wins. If you want to take this route I wish you the absolute best and that you learn along the way, however almost every beginner will benefit from playing the long-term holding game.
Don’t rush in to volatile stocks that may produce extreme share price swings that leave you in the rubble. That type of volatile trading is for advanced and licensed individuals/corporations. Shares are always profitable in the long run. A term that you should hold close to heart. A sneak peak in to my portfolio, it contains a lot of ‘bonds’ which are fixed rate return instruments.
I hope this blog helps you get started trading stocks/equities, and for further coaching and consultation on financial trading options, please reach out to me.
Managing Partner @ IHG Management