A Conversation from the Pit

This column is called, Echoes from the Pit, not Conversations from the Pit, but I thought you would be enlightened by an actual email string from last week regarding Fed intervention in financial markets. This kind of conversation happens daily as Pinnacle analysts try to reach consensus on how to tactically allocate our strategies. I…

Why We’re Buying Oil

Pinnacle has various defenses built into to how we manage our portfolios. We live by the two unbreakable rules of keeping diversified and avoiding overvalued assets. In addition, we also look to keep various hedges in our portfolio to defend against adverse conditions that have the potential to rattle financial markets. Over the last few…

An Oil Breakout and Pullback

Oil, and more specifically gasoline, has been in the news recently. Will $4 or $5 gasoline kill the consumer one more time? For the moment it seems the improving jobs picture is helping to insulate the consumer, but at some point there will come a choking point. With that said the price chart for oil…

Three Ways to Evaluate Portfolio Returns

Consumers of investment management might consider three different methods to analyze investment returns. The first method is to look at absolute returns in the context of your financial plan. If the portfolio return was 7% annualized for ten years, was that return high enough for you to achieve your financial goals? What about 3% annualized…

A Bearish Divergence

On October 7, 2011, I wrote a blog post describing a bullish divergence forming in the Financial Sector SPDR. I used the Relative Strength Indicator to measure momentum and the price of the XLF to show that although the XLF made a new price low, the indicator did not confirm the drop. I could have…

Fixed Income 101 (or maybe 201)

The duration of a bond portfolio tells you how much the price of your bonds will change for each percentage change in interest rates. A high duration means more sensitivity or price volatility as interest rates change. Duration tells you virtually everything you want to know about the price sensitivity of U.S. government bonds, which…