28 October 2011

Dear Friend:

Are you ready for the Holidays?  They are rapidly approaching and will be on our doorstep within a few weeks.  Before we know it, another year will fly by and we will find ourselves in the year 2012!  We have certainly experienced wonderful weather this year.  As I started writing this update, there was a Hurricane in the Caribbean heading to the Yucatan Peninsula and its possible path could have brought it here within a few days.  This morning, it appears the cool front heading our way will be enough to break up the storm and push it away from us.  

Wow!  We dodged another bullet!

Many of our technical indicators are telling us that the stock market now is going to rally for a while, perhaps through the end of the year.  However, it will probably be a bumpy ride on the way up.  It appears the market likes the efforts that are being expended in Europe to solve their severe debt problems.  The resolution of the joint debt agreement has investors willing to bid stock prices up again.  Of course, this does not mean that their problems are solved, not by a long shot.

Mutual fund manager, Whitney Tilson, made an interesting observation on Wednesday morning concerning events in Europe.  Comparing them to the financial crisis of 2008, he noted:

“The U.S. ‘subprime crisis’ involved mortgages, whereas in Europe they are dealing with ‘subprime countries’.”

Last week, we began cautiously moving back into the stock market in most of our managed accounts and have begun the process of re-capturing our investment profits from earlier this year.  The markets are still very volatile, so be aware that we will continue to experience values going up and down.  However, you can rest assured that we will remain diligent in our analysis of the economic circumstances around the world and the impact of this information on the investment markets!  In addition to our evaluation, we receive technical analytical data from a number of associated analysts and utilize all of this data to determine the appropriate portfolio allocations for your managed accounts.

This is a great deal more effort than most advisors are willing to provide.  However, this extra effort that we invest has paid off in greater benefits for you, our valued client.  Our Dynamic Active Investment Management has allowed us to create an excellent performance track record.  Since the beginning of 1999, our composite performance through September 30, 2011 (almost 13 years) has out-performed the broad stock market – as compared to the S&P 500 index – by about a 100% margin and we have accomplished this with approximately one third of the market risk of the S&P.  Of course, you know that past performance is not a guarantee of future profits.  All investments have risk and can gain or lose value over time.

As always, I am available to talk with you, so please feel free to give me a call.  Don’t forget to share this information with your family and friends.  People generally tend to forget how much they lost during the last “Bear Market” and you can share with them that you did much better because of our management.  It would undoubtedly benefit them a great deal to consider our services.

Sincerely,
Phil Couture, President, CFP®
Couture Financial, Inc.