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CNBC segments with Schatz:





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Investing in Berkshire Hathaway could look different once Warren Buffett steps down
Author: Lorie Konish
Date: Jan 10, 2018
Publication: CNBC
Link to Article
  • The 87-year-old billionaire acknowledged he is moving toward a succession plan for the leadership of Berkshire Hathaway with the appointment of two new board members.

  • A change in leadership prompted by Buffett's departure would change the investment outlook for the company.
Warren Buffett is coming closer to naming a successor at Berkshire Hathaway. It remains to be seen whether the company will lose its lustre without the Oracle of Omaha.

Buffett named Gregory Abel, 55, and Ajit Jain, 66, to the company's board on Wednesday. Abel will serve as vice chairman of non-insurance business, while Jain will serve as vice chair of insurance operations.

The appointments are "part of a movement to succession over time," Buffett told CNBC in an exclusive interview.

The legendary investor's departure would put the company into unchartered territory for retail investors. Buffett took the company over in 1965 and has overseen its growth ever since.

The 87-year-old businessman currently serves as chairman and CEO of Berkshire Hathaway alongside vice chairman Charlie Munger, 94. The Omaha-based conglomerate employs tens of thousands in a variety of businesses including insurance, mobile housing and industrial concerns.

Buffett said on Wednesday that he is in "remarkably good health."

"I feel terrific. I love what I do. I can't wait to go to the office in the morning," he said. "There's nothing I'd rather be doing."

Buffett said he will notify Berkshire's board and shareholders if he experiences any health issues. Berkshire's board already knows who would take over if something happened to him, he said on Wednesday.

Warren Buffett, Chairman and CEO of Berkshire Hathaway. David A. Grogan | CNBC "Probably no other company on earth has this kind of make up where you have someone who has essentially been running the company for 50 years," said Paul Schatz, president of Heritage Capital in Woodbridge, Connecticut.

Buffett himself could not repeat his investment track record with the level of assets the company now has, according to Schatz. That will pose a challenge for his successors.

"They can do a great job, but there is no chance they will come close to the record he compiled over the last 50 years," Schatz said. "The assets are just too big."

Schatz predicts there would be some changes to the company's stock, which is sold in two classes, with Buffett's departure. "Once Warren and Charlie are gone, there will be intense pressure to start paying a dividend," he said.

The chart below shows how Berkshire Hathaway's less expensive shares have fared against the S&P 500 index over the past five years.

BRK.B

Mark S. Germain, founder and CEO of Beacon Wealth Management in Hackensack, New Jersey, said he still sees Berkshire Hathaway as a promising investment.

"The brain power of Berkshire Hathaway has not been diminished by adding more brain power," Germain said. "The key players are still there."

Still, if a sudden management change were to happen and Buffett was no longer at the company, Germain said he would put the company on watch.

"We put the buying of that particular investment opportunity on hold until we have time to evaluate," Germain said. "It doesn't mean you go and sell everything."

Germain said he thinks Buffett has made plans for Berkshire Hathway with the same long-term focus he applies to his investments.

"If I could pick someone to have been mentored by, it would be Warren Buffett," Germain said. "Exactly as he looks for companies, he wants his company to be managed in the same fashion."


Paul Schatz 2018 financial projections
Author/Anchor: Keith McGilvery
Date: Jan 10, 2018
Publication: FOX 61
Link to Article



Investment tips for 2018
Author: Samantha Miller, News 8 Producer
Date: Jan 09, 2018
Publication: WTNH - NEWS 8
Link to Article



(WTNH) — President of Heritage Capital LLC Paul Schatz shares some investing tips for 2018.

1: We report on stocks going up and down every day. What’s your outlook for 2018?

Schatz says stocks had the least amount of volatility, or ups and downs in 2017 of all time. For 2018, Schatz predicts more ups and downs. The market will continue to change in the short term, but Schatz worries that later this year, the bottom may begin to fall a little bit. The first six months of the year are predicted to shape out well for the markets.

2: Is it too late for people to invest?

When the market bottomed in 2009, very few people wanted to invest. Schatz says it wasn’t until the DOW hit $25,000 that people felt they had missed the boat. Schatz says if you can tolerate the risk of stocks, you can put in a little each day, week or month, which is called dollar cost averaging.

3: What are your thoughts on our local economy here in Connecticut? Where are we headed?

Schatz worries about what he says is a “fiscal and pension disaster” in the state. His concern is that Connecticut’s economy will not build up the strength to match up to other parts of the country. Small and mid-sized companies are not having the best of luck moving into our state. Schatz says the masses need to speak up, in order to make a change.

4: How will the new GOP tax reform bill affect the people of Connecticut?

The problem here in Connecticut is that we are a high income tax state. Under the new tax plan, you can no longer deduct more than $10,000 in property and income tax. The wealthier people in Connecticut can decide if they need to relocate, which can overall hurt the state. Schatz says the only benefit the tax reform package has for Connecticut is that the minimum amount you can deduct went from $12,700 to $24,000. This means most people are taking the standard deduction instead of itemizing on their taxes.


Stretch Your Dollar: New year, new "fiscally responsible" you
Author: Laura Hutchinson, News 8 Anchor
Date: Jan 08, 2018
Publication: WTNH - NEWS 8
Link to Article



(WTNH)– New year, new “fiscally responsible” you. That sounds like a plan. If you’re looking to get your finances in order this year, we’ve got some help.

Fresh off holiday shopping, getting your finances in order is probably near the top of your to-do list for 2018. Experts say the best place to start is finally create that budget.

“Over 95 percent of the country does not even have a budget,” said Paul Schatz, financial resolutions.

How do you do that? Paul Schatz says take an honest look at where you spent your money last year and talk to your financial adviser about where to go from there.

“But when you put things on a spreadsheet, you’ll be surprised to see where that money goes,” said Schatz.

If you can, shave off some of your income and put it in a rainy day fund, set it up to come out automatically if you can. Or divert it to your retirement,

“If you can add a little more each paycheck to your 401K, to your IRA, to your SEP, it’s only going to help you out with retirement planning but also from a tax point of view, you’ll pay less taxes to the government which is always a good thing for us,” said Schatz.

Make it part of your routine to check your credit score and what goes into it. Many people find errors when they watch it closely, which, when corrected, can drastically improve your financial profile.


RIAs hedge market risk with actively managed funds
Author: Jeff Benjamin
Date: Dec 28, 2017
Publication: Investment News
Link to Article

Advisers worry that, as the bull market gets long in the tooth, passive funds may falter

As the stock market closes in on a solid 22% gain for the year, marking a near-300% gain from the 2009 low point, a growing chorus of financial advisers are citing actively managed strategies as a reasonable hedge at this point in the market cycle.

An InvestmentNews survey of more than 300 registered investment advisers found that nearly 71% believe active management will outperform passive strategies in 2018.

"It's almost intoxicating as the market climbs higher and higher every day, but what non-professionals don't know may well be their Achilles heel," said Rose Swanger, president of Advise Finance.

"As more people withdrew their investments (during the extended bull market) from active fund management for passive index funds for lower fees and other attributes, they forgot the fundamental weakness of the index fund; that it passively follows the market," she added.

While passively following the market for much of the past nine years would have been a great strategy, some financial advisers are playing the odds that the good times can't last forever, and down markets generally favor actively managed strategies.

"I would like to bet [The Vanguard Group founder and retired chief executive] John Bogle $1 million that over the next five years active management handily beats passive, and with less risk," said Paul Schatz, president of Heritage Capital.

"I think the cycle for passive is in its final stage and those who flooded into passive strategies will be sorely disappointed," he added.

Mr. Bogle could not be reached for comment.

This year through Wednesday, the S&P 500 Index trails the actively managed large-cap growth fund category by six percentage points, according to Morningstar.

"I've always been a believer in active management, and I tell people that have drunk the Kool-Aid of passive management that they don't need a financial planner," said Kashif Ahmed, president of American Private Wealth.

"I don't ever believe in plain-vanilla indexing," he added. "But right now, we're at a point in the market where there needs to be a human being allocating to things that are not so stretched."

Such attitudes of caution are showing up despite a relative absence of calls of doom and gloom from market forecasters.

John Lynch, chief investment strategist at LPL Financial, said the S&P 500 is "well positioned to generate strong earnings" in 2018, which he attributes to stronger global growth and lower corporate tax rates.

Mr. Lynch predicts that the benchmark S&P 500 will gain between 8% and 10% in 2018.

Tim Holsworth, president of AHP Financial Services, is among those advisers still not convinced active management is where to be at this point.

"We are taking the attitude of 'show me active is better' before changing much of what we're doing," he said. "The changes we will make going forward will be focusing on allocation, which means staying within the respective risk tolerance of each portfolio."


Stretch Your Dollar: Year-end tips to save money come tax time
Author/Anchor: Laura Hutchinson, News 8 Anchor
Date: Dec 28, 2017
Publication: WTNH - NEWS 8
Link to Article



(WTNH)– Only a few more days left in 2017 and as much as we’d all like to relax after the busy holiday, there are a few things you should be doing before the New Year to save yourself some money!

We are stretching your dollar with some year-end tax tips.

Before you ring in the New Year, there’s some steps to consider to save yourself money come tax time. Like giving to charity, make sure to get a receipt to back up any contribution, regardless of the amount.

Heritage Capital’s Paul Schatz says with President Trump‘s tax bill passing, you’re also smart to pay your bills early.

“We have state income taxes you need to pay in 2017, as well as your property taxes due in January in 2017, so if you can write it off, you get the write-off immediately in 2017 because in 2018 that deduction gets capped at $10,000,” said Schatz.

He also suggests you pay as much as you can on your home equity line of credit because come 2018 the interest on it will no longer be deductible.

And think about your retirement,

“You have until December 31st to make that last 401K contribution. If you get a bonus, you can certainly divert more of that bonus toward your 401K. That’ll help you tax situation going into next year as well,” said Schatz.

And don’t forget to spend down any flexible spending accounts for health care expenses. It’s money that will go away come January first. You can always make a last-minute trip to the drug store, dentist or optometrist to use up the funds in your account.


Financial tips for the New Year
Author/Anchor: Samantha Miller, Producer
Date: Dec 22, 2017
Publication: WTNH - NEWS 8
Link to Article



(WTNH) — As the New Year approaches, this may be the perfect time to manage your money. President of Heritage Capital LLC Paul Schatz has some financing tips, in light of the new GOP tax reform bill.

Paul Schatz says last minute financial tips and the tax reform bill go hand in hand. States like Connecticut, which is a high-tax state, do not come out on top under this new plan.

Connecticut residents get hurt by the 10K cap on the SALT and property taxes. Schatz says however, the standard deduction goes from $12,700 to $24,000 as well as a cut in the brackets.

As we get closer to 2018, Schatz has some money moving tips:

  • Pay your income and property taxes in 2017

  • Accelerate/increase charitable contributions

  • Defer income, especially if pass through income

  • Pay off/reduce HELOCs

  • Take RMDs

  • Harvest Tax Losses

  • Use or lose FSA

  • Increase 401K contribution

  • Don’t recharacterize ROTH IRA


Trumponomics downgraded to B from A-
Author/Anchor: Seana Smith
Date: Dec 14, 2017
Publication: Yahoo Finance
Link to Article



Yahoo Finance's Seana Smith, Rick Newman, Melody Hahm and President of Heritage Capital Paul Schatz discuss why Trump's economic rating has slid downhill.


Walmart has a new pay perk for employees
Author/Anchor: Seana Smith
Date: Dec 14, 2017
Publication: Yahoo Finance
Link to Article



Walmart is offering its workers a new perk. The retailer announced its 1.4 million workers will be able to get their hands on their money earlier. Yahoo Finance's Seana Smith, Rick Newman and Melody Hahm along with Heritage Capital's Paul Schatz discuss.


Govt Shutdown Fight Looms
Author: Neil Cavuto
Date: Dec 05, 2017
Publication: Fox Business - Coast to Coast



GE cut highlights peril of relying on income from dividends
Author: Lorie Konish
Date: Nov 14, 2017
Publication: CNBC
Link to Article

  • GE is cutting its dividend in half, which will give investors in the company $4.1 billion less each year.

  • The move is a reminder to investors who count on income from dividends to carefully evaluate their investments, experts say.


The decision by General Electric to cut its dividend in half as the company restructures should be a warning to investors: Don't count on income from dividends.

GE's move reduces its quarterly dividend to 12 cents a share from 24 cents and will give its shareholders $4.1 billion less each year.

Because the company has only cut its dividend twice since 1899, the move may come as a surprise to some shareholders. Yet experts caution that investors need to be ready for such moves when investing in dividend stocks.

"There are no guarantees and the marketplace can change, so you need to be flexible," said financial advisor Greg Ghodsi, managing director, investments at 360 Wealth Management Group of Raymond James.

Investors need to watch out for getting too emotionally attached to a single company, say when they inherit the stock from a parent who worked there for 30 years, Ghodsi said.

They also need to keep their time horizon in mind. A retiree who has plenty of income from a pension and Social Security may be OK holding onto the stock. Someone else who relies on that income could be overexposed, according to Ghodsi.

"It is critical that they know exactly what they own," Ghodsi said. "Today it's GE, but in a month or six months it will be another company."

Individuals looking to invest in dividend stocks should evaluate a few things, according to J.J. Kinahan, chief market strategist at TD Ameritrade.

First, look at the stock price.

"You tend not to get any dividend cuts when the price is stable," Kinahan said.

Second, for companies that don't have a long history of paying dividends, look to see where else the company is putting its money. Signs of a strong business model include investing in new products and research and development, Kinahan said.

"Nothing is safe if you don't regularly review it," Kinahan said. "Be prepared and do a little homework."

While some financial professionals see opportunity in the GE news, others say it's another reason to be wary of large dividend-paying companies.

"I think this is the first time I've been positive on GE since the 1990s," said Paul Schatz, president of investment management firm Heritage Capital in Woodbridge, Connecticut.

"I think people are going to mistake GE's idiosyncratic problems with problems with large-cap dividends," Schatz said. "There are plenty of really good stories out there in the dividend space that people should not ignore."

Stephen Aniston, president and chief investment officer of investment advisory firm Black Peak Capital in Fairfield, Connecticut, said he sees other examples of dividend-paying companies that have had declining cash flows, earnings and sales, such as Coca-Cola and Caterpillar.

"They have had steady declines in earnings and cash flows over the last few years. They trade at increasingly higher multiples," Aniston said. "The fundamentals of their businesses do not support increasing the dividend."


Nightly Business Report – November 13, 2017
Author/Anchor: Sue Herera
Date: Nov 13, 2017
Publication: NBR - CNBC
Link to Article



Tonight on Nightly Business Report, GE cuts its dividend for only the second time since the Great Depression. Plus, as airlines pay more for jet fuel, will fares go higher?


Why the Dow won't be haunted by an October market crash this year
Author: Adam Shell
Date: Oct 5, 2017
Publication: USA Today
Link to Article

October has a sinister reputation on Wall Street. Stock market crashes in 1929 and 1987 are mostly to blame. But doomsday predictions for equities this October are conspicuously absent.

Indeed, instead of spreading a message of doom and gloom, portfolio managers and investment strategists interviewed by USA TODAY are calling for continued gains for U.S. stocks and downplay the risk of a big fall in equity prices.

The optimistic market call has been correct -- at least so far.

In the first four trading days of October, the U.S. stock market has been in rally mode. The Dow Jones industrial average has closed higher each day, notching its 43rd, 44th, 45th and 46th all-time highs of the year. The blue-chip average is up more than 15% in 2017 and is within 255 points of 23,000.

In another sign of strength, the Standard & Poor's 500 stock index has posted record closes six straight sessions, its longest string of all-time highs since 1997, according to S&P Dow Jones Indices.

The sizable gains have come despite fears of a U.S. military confrontation with North Korea, President Trump's stalled economic agenda and a market that has become pricey relative to earnings.

The basis for the bullish trading action boils down to two things:

First, the record-breaking stock market is being supported by improving business conditions around the globe, which bolsters the earnings power of publicly traded companies.

The second big reason for optimism is there are few present signs of traditional bull market killers, such as wildly overvalued stock prices, overly optimistic investors, rapidly rising interest rates and contracting economic growth.

"Most of these ingredients that cause market meltdowns are missing," says Peter Cardillo, chief market economist at First Standard Financial, a financial services firm headquartered on Wall Street in New York.

With fewer bad things in the pipeline to trip the market up and the economy and corporate profit growth coming in at or above investor expectations, Cardillo says he doesn't expect an "October surprise."

Barring market angst caused by an unpredictable geopoltiical event, the "market is likely to move higher," he says, adding the market can suffer short-term blips, or pullbacks, at any time.

If Cardillo is right, investors that suffer from the Wall Street malady "October-phobia" —or the fear of a stock market crash such as the Dow's 22.6% drop on Black Monday in October 1987 — might get a reprieve from their angst and find their heightened anxiety level is misplaced.

October's Dark Past

Thanks to tumultuous, wealth-destroying market events, October has a dark past.

The 1929 crash that caused the Great Depression happened in October. So did the 1987 crash. Stocks also suffered a short drop of nearly 10% in October 1997 in a selling panic sparked by a currency crisis in emerging markets. The last bull market also died in October 2007, setting off the worst stock market decline since the Great Depression. Stocks also cratered nearly 17% in October 2008 during the financial crisis.

All the stock market dives in years ending in "7" — 1987, 1997 and 2007 — give investors pause, Paul Schatz, president and chief investment officer of Heritage Capital, a personal investment management firm in Woodbridge, Conn., said in a research report.



"Octobers in years ending in 7 have had unique behavioral patterns to the downside," he wrote. The good news, he counters, is that most of the biggest declines have come when markets were already in decline heading into the month. Stocks, of course, have been on a tear all year long.

Reasons to be Bullish

Bad memories of short-term stock losses overshadow the fact that October' s overall performance over the years hasn't been as horrific as the highly-publicized plunges suggest, data show.

October, for example, actually marks the end of what historically has been the worst six months for stocks and the start of the best three-month period, which is the year-end stretch from October through December.

October has also been the Dow's second-best month in the past 20 years, posting gains of nearly 2% and finishing higher 70% of the time, according to Bespoke Investment Group. And since the end of the 2008 financial crisis, the broader Standard & Poor's 500 stock index has gained nearly 3% in October from 2009 thru 2016, versus an average gain of 0.9% for the month dating to 1983, Bespoke data show.

Rock-tober gains in 2017?

The recent strong performance in October is seen continuing this year.

Chris Retzler, manager of the Needham Small Cap Growth fund, says despite October's "frightful reputation," he does "not expect a negative October surprise."

Stocks will benefit from improving global growth prospects and "potential clarity" on government policies, including President Trump's recently proposed tax cut plan, Retzler says. Any pressure on stocks that results from fear of the Fed removing stimulus from the financial system will be offset, he says, by the pro-growth policies and deregulation from the Trump administration.

In the end, Wall Street doesn't see the bottom falling out of the stock market because the foundation of the rally is supported by economic growth, strong earnings and low borrowing costs.

"There's just not a lot to fear in the outlook," says Chris Rupkey, chief financial economist at MUFG Union Bank.


Schatz: Bull market far from over
Author/Anchor: Alexis Christoforous
Date: Oct 4, 2017
Publication: Yahoo Finance
Link to Article



Even with major indexes sitting near all-time highs, Paul Schatz, President of Heritage Capital, says this bull market is far from over.




Unlucky 7? Dow looks to dodge curse of years ending in a 7
Author: Adam Shell
Date: Oct 4, 2017
Publication: USA Today
Link to Article

Will the curse of the calendar doom stocks again this October?

October is best known for stock market crashes in 1929 and 1987. But what investors may not know is that many of the market’s worst-ever drops have occurred in October when the last digit of the year ends in a 7, notes Paul Schatz, president and chief investment officer of Heritage Capital, a personal investment management firm in Woodbridge, Conn.

“Beware October in Years Ending in 7,” he warned in a report.

What’s up with this seasonal stock market quirk?

Well, in 2007 stocks rallied into October only to hit a wall amid lofty valuations and early hints of the coming mortgage crisis. October turned out to be the top in the 2002 to 2007 bull market and the start of the worst stock market decline since the Great Depression.

In 1997, a currency crisis in emerging markets sparked panic selling that briefly pushed the Standard & Poor’s 500 stock index down nearly 10% in October.

And pretty much everyone knows that on Oct. 19, 1987, the Dow Jones industrial average suffered its biggest one-day percentage drop ever. The 22.6% plunge is referred to as “Black Monday,” the worst day in Wall Street history.

But so far this year, October has bucked the trend. The Dow has rallied to new highs the first two trading days of the month amid continued economic optimism. Still, October and years ending in 7 are “something investors need to be aware of with North Korea percolating,” Schatz says, citing a geopolitical event that could upend markets.


Betterment partners with BlackRock, Goldman to offer more portfolio options
Author: Jeff Benjamin
Date: Sept 13, 2017
Publication: Investment News
Link to Article

Robo-advice pioneer gets more sophisticated with smart-beta offering

Betterment has partnered with BlackRock and Goldman Sachs to push its digital platform further into the realm of more-complex investment strategies.

The robo-advice platform, with $10 billion under management, announced Tuesday it is adding an income portfolio option from BlackRock and a smart-beta option from Goldman.

The latest additions continue a theme, according to Dan Egan, Betterment's vice president of behavioral finance and investing. The strategies join core tax-advantaged, taxable and socially responsible portfolios, and two municipal bond options for high-tax residents of California and New York.

"These are all examples of us trying to make it even easier for our clients to reach the appropriate investment solution," Mr. Egan said. "Across the board, we are looking at more personalization, with services and features that families tend to use."

But as Betterment has continued to evolve, some have started to question the direction of growth for a digital platform that is leveraging low-cost investing to the mass consumer market.

"In the grand scheme of things, this means nothing because the average Betterment client has no idea what the pros and cons of something like smart beta are," said Paul Schatz, president of Heritage Capital Management.

But Mr. Egan said the strategies being added to the Betterment platform, specifically the smart-beta portfolio, is appropriate for the target market.

"We're seeing more appetite for variety and tailoring, and we need the right breath of solutions to allow investors to do that," he said.

Smart beta is a generic term for strategies that alter allocations within traditional indexed portfolios. There are multiple varieties of smart beta, which attracts as many proponents are critics.

"Smart-beta products can play a role in risk reduction and possible return enhancement, but they're complicated enough that it requires some investor education," said Todd Rosenbluth, senior director of mutual fund and ETF research at CFRA.

Mr. Schatz was more direct, describing smart beta as "quasi passive management."

"For people to think smart beta is a new and unique thing makes me laugh," he said. "Betterment should have just stuck to their knitting of cheap, passive strategies."

Meanwhile, as part of the statement, Betterment founder and chief executive Jon Stein said the robo-platform is responding to customer demand.

"Betterment has an increasingly diverse customer base; they all want to put their money to work, but not necessarily in the same way," he said. "Adding these options to our existing portfolio strategies will help us deliver on our promise to provide customers with a personalized investment plan tailored for their individual needs and preferences."



Analyzing stock market behavior after disasters
Author/Anchor: Nicole Warren, Senior Producer
Date: Aug 31, 2017
Publication: WTNH - NEWS 8
Link to Article



(WTNH)- With Hurricane Harvey and the associated historic, catastrophic flooding the area is experiencing and the country is watching in real time, financial expert Paul Schatz of Heritage Capital LLC started thinking about how the stock market (S&P 500) and insurance stocks fared during previous disasters.

Schatz says when Superstorm Sandy hit, stocks were already pulling back. They rallied for a day before falling to their ultimate lows two weeks later. From there, it was straight up.

Hurricane Katrina is different story because it had two landfalls, first in Florida which people forget and then in Louisiana. Katrina was also a category 5 storm in the gulf which somewhat led to the pullback into its second landfall. Stocks opened lower on Katrina day and then rallied for two weeks before rolling over again to the final low in October. Then it was up, up and away.

With Hurricane Andrew, stocks had already been pulling back when this monster made landfall in 1992. Similar to Katrina, stocks rallied immediately for two weeks before rolling over to their ultimate lows in October before soaring again.

Today, the stock market has been in pullback mode, which has been a theme all month. It’s not really conforming to any of the previously mentioned disasters.

If any sub-sector should be impacted by disasters, you would think it would be the insurance group. Schatz looked at how the Dow Jones Insurance Index behaved around the events.

Sandy was already pulling back when it hit and continued to weaken for two more weeks before blasting off to the upside. This was basically in line with how the stock market did although a little earlier.

Reaction to Katrina was surprisingly strong as the sector did not have much downside immediately following although the S&P 500 was much stronger. And when the S&P 500 declined into October to new lows, the insurance group made a higher low, indicating possible future leadership which came to fruition through November.

For Northridge, he used the stock of Allstate. While the S&P 500 rallied and then declined, Allstate was literally straight down for several months with barely an intervening rally.

With Andrew, he used the stock of Travelers since Allstate wasn’t public yet. Similar to the S&P 500, Travelers rallied a little and then declined although it wasn’t perfect.

Today, we see that the insurance group has been under pressure for a few weeks, oddly up ticked on Friday and now is declining. If history is any guide, we should see a good buying opportunity in this sector sometime in September.




Will Jeffrey Gundlach's Trump-like approach on Twitter work in financial services?
Author: Jeff Benjamin
Date: Aug 18, 2017
Publication: Investment News
Link to Article

The DoubleLine CEO's attacks on Wall Street Journal reporters is igniting a discussion on what's fair game on social media

Jeffrey Gundlach's new aggressive Tweeting style has sparked a discussion as to whether it makes sense in the financial services industry.

The founder and CEO of DoubleLine Capital, a $111 billion asset management firm specializing in fixed income, has been? expressing himself on Twitter in ways that have been compared to some of the unfiltered tweets by President Donald J. Trump.

Over the past several days, Mr. Gundlach has been aggressively tweeting about an upcoming story by the Wall Street Journal, describing it as a "hit piece" and "fake news," and calling out reporters for their tactics.

Mr. Gundlach, who opened his Twitter account in May as @TruthGundlach, has nearly 34,000 followers, despite posting just 120 tweets.

The appeal, aside from the obvious direct perspective from one of the country's leading bond-fund managers, might be the kind of candor Mr. Gundlach has been expressing toward various media outlets.

But, what makes for a good tweet isn't always the same as a good business strategy, according to April Rudin, founder of RIA marketing firm, Rudin Group.

"Just because you can do something doesn't mean you should do something," she said. "I would never advise clients to do something like this themselves, but I think people are feeling empowered or enabled by what the president is doing on Twitter."

Controversial or not, and many of Mr. Gundlach's tweets are light-hearted and outside the realm of asset management, the DoubleLine company perspective is that this is one of the advantages of running a private business.

"DoubleLine is a very unique firm that is independent and privately held, and Jeffrey is his own man and he speaks his mind," said Loren Fleckenstein, DoubleLine analyst and spokesman.

He added that, similar to the popularity of Mr. Gundlach's public speaking and quarterly conference calls, "registered investment advisers love what he's doing, and they've told him that."

Paul Schatz, president of Heritage Capital, who is also not shy about expressing his views on Twitter, thinks Mr. Gundlach should rise above whatever negative press coverage DoubleLine is receiving.

"He clearly loves the spotlight, but it seems only on his terms," Mr. Schatz said. "He's a masterful fixed-income manager, but he should leave it at that."

Carolyn McClanahan, founder and director of financial planning at Life Planning Partners, also believes fights on social media can become petty.

"I prefer respectful discussion and discovery of where points of view come from with a focus on possible solutions," she said. "I wish we could quit the 'gotcha' mentality that is pervasive on Twitter."

That wish might be comparable to the challenge of putting toothpaste back in the tube, according to Jason Lahita, president and co-founder of FiComm Partners, a public relations firm specializing in the financial services industry.

"Twitter has effectively become, particularly in recent years and accelerated by Trump, a powerful PR tool and must be managed as such because anything on it is fair game for reporters to use," he said. "The Trump-crazy approach does not work in financial PR, so one hopes Gundlach is not borrowing from that playbook, but his tweets do bear resemblance to The Donald's."

In practice, however, what works might depend on what you're trying to accomplish.

"All I can say is, Gundlach always seems to be right in his judgment, even if he isn't always gentle in his delivery," said Bob Veres, owner of Inside Information.




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Heritage Capital, LLC (HC) is a state of Connecticut registered investment adviser located in Woodbridge CT. HC and its representatives are in compliance with the current filing requirements imposed upon state registered investment advisors by those states in which HC maintains clients.

HC may only transact business in those states in which it is registered, or qualifies for an exemption or exclusion from registration requirements. HC's web site is limited to the dissemination of general information pertaining to its investment advisory services. Accordingly, the publication of the HC's web site on the Internet should not be construed by any consumer and/or prospective client as HC's solicitation to effect, or attempt to effect transactions in securities, or the rendering of personalized investment advice for compensation, over the Internet.

Any subsequent, direct communication by HC with a prospective client, shall be conducted by a representative that is either registered or qualifies for an exemption or exclusion from registration in the state where the prospective client resides. For information pertaining to the registration status of HC, please contact the SEC and/or the state securities law administrators for those states in which HC maintains a notice filing.

A copy of HC's current written disclosure statement discussing HC's business operations, services, and fees is available from HC upon written request. HC does not make any representations or warranties as to the accuracy, timeliness, suitability, completeness, or relevance of any information prepared by any unaffiliated third party, whether linked to HC's web site or incorporated herein, and takes no responsibility therefore. All such information is provided solely for convenience purposes only and all users thereof should be guided accordingly.