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Dental Tribune U.S. Edition

Dental Tribune U.S. Edition | November 2013 A27INduStry NEWS fect on all fixed-income investments by extension. Although the yields are still near historic lows, the Federal Reserve’s comments hinting at the easing of stimulus has caused bond yields to rise and, therefore, prices to fall. We are see- ing this more pronounced at the longer end of the yield curve with a change in the Barclays Long index of -6.47 percent through July 2013 versus the Barclays In- termediate index of -1.10 percent for the same period. So what are the next steps? Do you have an investment plan? Have you fig- ured out your “risk profile” and adjusted your investments accordingly? Do you have a “bunker?” If the market drops by 10–20 percent, do you have enough cash and liquid investments as a reserve so that you can avoid selling “underval- ued” assets to meet emergency or even day-to-day needs? Are you properly di- versified? We advocate that investors work with financial professionals who understand both historic market patterns as well as how markets react in a rising interest rate environment. There is little substi- tute for education, investment product knowledge, experience and a strong understanding of helping people reach long-term goals. It is painful to see CDs and short-term Treasurys paying less than 1 percent. If it is part of your “bunker” you have to stay disciplined. If your investment time-frame is short, you must be very careful of volatility. With a longer time- frame you could possibly take advantage of high-quality stocks with dividend po- tential or short-term corporate bonds. Remember, we are in a global economy so do not overlook investment opportu- nities throughout the world. These are all issues that investors should be seek- ing help with through a qualified profes- sional. We believe that one of the safest ways to invest is with a long-term horizon. We don’t see the “crash” that many fear but we do see volatility in the equity side of the market and we flash caution on the fixed income side of the market. With care and the proper maintenance, we hear the dull thud of the corporate bottom line continuing to resonate for future growth. Remember: Head down, focus, drive the ball. You can visit the Keator Group online at Disclaimers and notices This article was provided by David Ke- ator, a partner with Keator Group LLC in Lenox, Mass. For more information, please call The Keator Group at (877) 532- 8671. Investment products and services are offered through Wells Fargo Advi- sors Financial Network LLC (WFAFN), member SIPC, a registered broker-dealer and separate non-bank affiliate of Wells Fargo Corporation. Keator Group LLC is a separate entity from WFAFN. Data pro- vided by JP Morgan Asset Management, Market Insights 3Q/2013, as of June 30, 2013. The accuracy and completeness of this material are not guaranteed. The opin- ions expressed in this article are those of the author and are not necessarily those of Wells Fargo Advisors Financial Network or its affiliates. The material has been prepared or is distributed solely for information pur- poses and is not a solicitation or an offer to buy any security or instrument or to participate in any trading strategy. Ad- ditional information is available upon request. Investing in fixed-income securities involves certain risks such as market risk if sold prior to maturity and credit risk, especially if investing in high-yield bonds, which have lower ratings and are subject to greater volatility. All fixed- income investments may be worth less than original cost upon redemption or maturity. U.S. Treasury securities are guaranteed by the full faith and credit of the U.S. government for the timely payment of interest and principal if held to maturity. Investing in foreign securities presents certain risks not associated with domes- tic investments, such as currency fluctu- ation, political and economic instability, and different accounting standards. This may result in greater volatility. Stocks offer long-term growth poten- tial, but may fluctuate more and provide less current income than other invest- ments. An investment in the stock mar- ket should be made with an understand- ing of the risks associated with common stocks, including market fluctuations. The S&P 500 Index consists of 500 stocks chosen for market size, liquidity and industry group representation. It is a market value weighted index with each stock’s weight in the index proportion- ate to its market value. The Barclays Capital Intermediate U.S. Aggregate Bond Index represents securi- ties in the intermediate maturity range of the Barclays Capital Aggregate Index. The Aggregate Index represents securi- ties that are U.S. domestic, taxable and dollar denominated. The index covers the U.S. investment-grade, fixed-rate bond market, with index components for government and corporate securi- ties, mortgage pass-through securities and asset-backed securities. These major sectors are subdivided into more specific indices that are calculated and reported on a regular basis. Securities in this in- dex must have a maturity from one to up to (but not including) 10 years. The Barclays Capital U.S. Long Govern- ment/Credit Index is the long compo- nent of the U.S. Government/Credit In- dex. It consists of securities in the long maturity range of the Government/ Credit Index that must have a maturity of 10 years or more. Keator Group LLC and Wells Fargo Advisors Financial Net- work do not render legal, accounting or tax advice. Please consult your CPA or attorney on such matters. Past perfor- mance is no guarantee of future results. Investments in securities and insurance products are not FDIC insured, not bank- guaranteed and may lose value. Ad