Weekly Market Commentary June 15, 2017June 15th, 2017 by Anchor Bay Capital's Investment Team
Recent Portfolio Moves:
Yesterday some changes were made to your portfolio through rebalancing our models to the allocation appropriate with their overall objectives.
Rebalancing simply brings your portfolio back to its desired asset mix by taking profits out of certain outperforming investments and re-investing those returns in under-performing assets.
The net result restores your asset classes to their target allocations. Implementing this process on a periodic basis helps align your investments with the goals of your financial plan.
A look at the Market:
We have seen momentum in the technology sector take a pause over the last week. The celebrated F.A.A.N.G. stocks (Facebook, Apple, Amazon, Netflix, and Google) are all off for the week. This selloff is not too alarming as the markets continued to touch new highs this week.
The technology sector continues to show prospects for growth amid expected volatility. The recent fluctuations are more due to investors rebalancing and rotating weight into different sectors. As technology has fallen, there have been advances in financials and industrials where investors are looking for value opportunities.
The Fed raised their rate target this week. This move was highly expected and the market had largely priced this move previously.
Here is a look at the market last week:
Increasing Positions in ETFs – ETFs or Exchanged Traded Funds give an investor a broader exposure to an area of the market while helping to mitigate the volatility. (For example, instead of buying 1 share of Google for $1000, an individual can invest $1000 in a technology ETF that includes exposure to Google, Apple, Microsoft and many others. This way, the investor will capture moderate gains from differing equities within the technology sector and won’t have to live and die with just one company.)
We continue to maintain a core portfolio in individual stocks. However, we have chosen to use ETF’s to complement this core portfolio and give you greater market exposure in certain sectors. Given an outlook for increased market volatility resulting from the current political climate, investing in ETFs is helping diversify accounts, decrease risk, and broaden the field from which we can harvest appreciation.