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South Korea Is One Of The Few Solid Rocks Amidst Sea Of Leaky Emerging Market Barges (A. Gary Shilling Insights)
Even though Gary Shilling is short emerging market stocks and bonds, he thinks South Korea might be an exception. "South Korea has emerged as one of the few relatively solid rocks amidst a sea of leaky emerging market barges," writes Shilling in the latest A. Gary Shilling's Insights. Investors have been rushing to South Korean equities.
"Investors of late have been rushing into South Korean equities amidst the Fed's recent discussion of tapering its $85 billion per month in security purchases, as we'll discuss later. As of the end of October, the KOSPI index was down only 1% from the October 2007 peak. In contrast, the MSCI World index is off 4% since then and the MSCI Asia Pacific Index has dropped 14%."
Shilling points out that South Korean bonds are also attractive to foresight investors because of the "relative stability of the country, higher yield and rising currency."
How You Should Invest Until The Year-End (Track Research)
This is a year for equities in both Europe and the U.S. writes Robert Savage in Track Research. "Global shares saw $2.3 trillion added in market capitalization in October. The US S&P500 rose 4.6% - the best performance since July. Bond rose 0.9% or yields for 10Y fell 12bps to 2.60% - the best performance since April - but remain off 0.5% for the year.
"...Trading continued to hold a “goldilocks” theme where economic growth was not strong enough to push the FOMC to stop QE bond buying but was sufficient to drive corporate profits. Earnings beat most estimates and Europe saw the biggest gains with 15 weeks of gains for Italy and Greece."
Economic forces still suggest a global recovery and support stocks over bonds. But "the role of the markets in forecasting growth into 2014 matters and the asset allocation questions revolve around getting GDP globally to match against the right investments."
PIMCO Is No Longer The World's Largest Mutual Fund (Bloomberg)
PIMCO is no longer the world's largest mutual fund, having lost that title to the Vanguard Total Stock Market Index Fund, according to Bloomberg. PIMCO ended October with $247.9 billion in assets, while Vanguard's Total Stock Market Index Fund ended with $251 billion. PIMCO shrunk by $37.5 billion in 2013.
SAC Capital Pleads Guilty To Insider Trading (Business Insider)
SAC Capital pleaded guilty to insider trading today and will pay $1.8 billion in fines. SAC also agreed to terminate its investment advisory business. By the end of 2013, $6 billion will be returned to outside investors, namely pension funds, high net worth investors etc. SAC will then become a family office with $8 billion in assets under management. The FBI and SEC continue to investigate Steve Cohen.
Credit Suisse Brokers Form Independent Advisory Firm (The Wall Street Journal)
Hal Lambert and Jeffrey Wildin who had $1 billion in assets under supervision at Credit Suisse, have left to start an independent advisor firm, according to Corrie Driebusch at The Wall Street Journal. The pair didn't however manage all of the $1 billion.
Lambert and Wildin founded PointBridge Capital in Dallas and Fort Worth. "Point Bridge Capital will access Dynasty's investment platform. It will use Pershing Advisor Solutions LLC for its clearing and custody services."
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