By: Todd Carbone

We are off to a great start in themarket for 2021. The market hasalready priced 2.5% for the S&P 500,4.28% for the Nasdaq, and 1.85% forthe Dow Jones of gains for the firstthree weeks of 2021. In addition, themarket has priced out a lot of theuncertainties from 2020. The start ofthe 2021 market, has the same feelingas the beginning of the Obamaadministration with the aftermath ofthe financial crisis, but instead, wehave a health crisis. Unsurprisingly, wehave the federal reserve giving theblessing of low-interest rates andpotential for additional quantitativeeasing.

Throughout history, the market hasfavored a democratic president, dueto fiscal spending via infrastructureand social well-being. The market iscurrently pricing a phenomenal 4-year term, thus why the market is hitting all-time highs already in2021. The market is a forecast of thefuture, not that the future can bepredicted, but it does take intoconsideration similarities andcommon characteristics. At thebeginning of the Obamaadministration on, January 20, 2009,through January 20, 2017, the S&P500 grew 171%, the Nasdaq grew264% and the Dow Jones grew147%!

We highly suggest adding funds to your current portfolio. If you have beenwaiting to put money to work, start adding to starter positions to get back intothe market. The market has just started to grow, it is not too late to add intopositions. Adding funds even in an upmarket is prudent, as long as you haveselling rules in place to preserve capital for market pullbacks. Take advantageat all levels, as there is always trade or a position that fits the marketconditions.

It is the Capital CS Group’s mission to change the way wealth is viewed,not as an independent journey, but as a path guided by a team ofprofessional financial advisors and a proven goal based financialplanning approach.

The Capital CS Group has demonstrated successful navigation of alltypes of markets through our in-depth financial planning processdeveloped over our 28 years of industry experience.

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By: Todd Carbone

I can’t believe it…. the year end is upon us and its been a memorable one. I feel like we’re on the 1- yard line, 4th quarter on our last down with 10 seconds to go. It is probably the best example I can demonstrate with the current market conditions. We are in a wait and see moment as the story unfolds in front us. With Presidential Elections next week, corporate earnings, a new wave of corona virus infections, a race to a vaccine and a new stimulus bill, this has been an interesting final quarter. With all of these factors and the current market conditions, the market is acting accordingly, which is nice for a change. There’s nothing worse than having bad market data and the market goes through the roof. This is why we follow the golden rule “The trend is your friend, until it’s not.” We were trending nicely for a bit, but now we have sideways action which is often driven by news. Trading news is nearly impossible because one moment is good, then next minute the news is bad. This type of choppy sideways market is great for swing traders, but often too difficult to risk manage, unless you have a system in place.

The good news is this sideway action, often allows investors to re- enter stocks that they have missed this year while buying at a possible discount. These entry points often present themselves as a Consolidation, Cup and/or Cup and Handle pattern. If market conditions remain healthy, then you will see investors buy into these technical patterns, this is because the “Expectation” is for these stocks to go higher. Now on the downside if these patterns fail, then the selling has not stopped and often most will retract to their prior lows or even lower.

Plan of action – Review your current positions, come up with a game plan and know your limits! Remember that days like today are only one data point, compared to 252 days of data during one full trading year.

Stay tuned.

Nasdaq
YTD Return : +26.67%
DJIA
YTD Return : -3.08%
S&P
500 YTD Return : +5.11%

It is the Capital CS Group’s mission to change the way wealth is viewed, not as an independent journey, but as a path guided by a team of professional financial advisors and a proven goal based financial planning approach.

The Capital CS Group has demonstrated successful navigation of all types of markets through our in-depth financial planning process developed over our 28 years of industry experience.

The post Market Update – The year end is upon us appeared first on Capital CS Group.

By: Todd Carbone

As of yesterday, the Stock indexes have declined solidly, with the Nasdaq down 3.02%, deepening its slide into correction. As of September 1, 2020, the Dow Jones is down 8.77%, the S&P 500 is down 10.34% and the Nasdaq is down 12.39%. In historical realities, the stock market has typically performed the poorest during the month of September. This has been dubbed as the “September

Effect.” This year has added risks, with the upcoming presidential election. During these uncertain and volatile times, it is prudent to begin building a cash position. This includes booking winners and losers, to ensure your portfolio is in capital preservation mode. Our Senior Portfolio Managers have been building a strong cash position by taking partial profits on winning leading stocks and reducing losses on losing stocks in the last month. Now is the time to look at your positions and ensure you are looking for

signs of institutional selling and breaking down of support levels. With the November 3rd election day less than 7 weeks away, we are expecting a surge in market volatility, with large daily swings. This can be a especially concerning, if you are using leverage or margin to purchase securities. Be conservative and reduce exposure when appropriate, as the market ride is just beginning to be bumpy. Building a strong

cash position, will give you the ability to take advantage of buying high quality positions, with less risk when the market dictates a rebound. Cash is king for now…

It is the Capital CS Group’s mission to change the way wealth is viewed, not as an independent journey, but as a path guided by a team of professional financial advisors and a proven goal based financial planning approach.

The Capital CS Group has demonstrated successful navigation of all types of markets through our in-depth financial planning process developed over our 28 years of industry experience.

The post Market Update – Sliding into correction territory appeared first on Capital CS Group.

By: Todd Carbone

Selling was due. We had an over extended market that was due for a sell off. This sell off is a little concerning with the NASDAQ down 8% in the last two days, which meets the criteria for a correction. Corrections happen all the time during the marketplace. It allows the market to reset between buyers and sellers.

It also provides opportunity for people to get into the leading stocks at a cheaper price. One thing that is concerning is the volume on this sell was higher than the two previous sales this year, including the sell off during the start of the Coronavirus pandemic. The volume is currently high, making this selling real. We do not know how this next quarter will be, especially with the upcoming

presidential election. If you are looking to book profits, take a look at your current portfolio and analyze what positions you have, checking to see if your positions are still holding the 50 day and how the price action has been. If you are looking to add new positions, look at adding only 25 to 30% of your max position size.

Also, add into the leading stocks if they are holding on the 50 day, because if you do break the 50 day your loss will be much smaller.

It is the Capital CS Group’s mission to change the way wealth is viewed, not as an independent journey, but as a path guided by a team of professional financial advisors and a proven goal based financial planning approach.

The Capital CS Group has demonstrated successful navigation of all types of markets through our in-depth financial planning process developed over our 28 years of industry experience.

The post Market Update – Selling was due. appeared first on Capital CS Group.

By: Todd Carbone

Well Ladies and Gentlemen-

Since my previous article, the market continues to move higher. In fact, the Nasdaq has hit all-time highs, while the Dow Jones and S&P 500 are still trying to play catch-up. Fund mangers and Institutions are continuing to push their BUY buttons, which is the signal an individual investor wants to see when adding to their portfolios. If you are still waiting on the sidelines,now is the time to take advantage of down days in the market and add where appropriate.

With any market rally, this current market is due for some selling or sideways action, which is totally healthy for a normal market. Now that we are halfway through the year and summer is finally here, if you have any positions that have not been performing or are lagging, consider replacing them. The ”hope” trade is costing you money!

If you are in a long-term portfolio with mutual funds or ETFs, it is time to review your positions and rebalance your current allocation. Taking time to rebalance your portfolio, will help you stay within your risk tolerance. Also, by selling your losers and buying your winners,

it will keep you properly balanced and diversified. Lastly, if you are still using mutual funds, it is time to review the internal fee schedule and its performance category against its peers. The internal fees from mutual funds can easily be avoided and can save you a lot of money each year by switching into an ETF model. If you are ok paying mutual fund fees, make sure your mutual fund manager is in the top performance group.

If you have any questions, please contact our team. Stay safe out there and try to have some fun in the sun!

It is the Capital CS Group’s mission to change the way wealth is viewed, not as an independent journey, but as a path guided by a team of professional financial advisors and a proven goal based financial planning approach.

The Capital CS Group has demonstrated successful navigation of all types of markets through our in-depth financial planning process developed over our 28 years of industry experience.

RETIREMENT CONTRIBUTION REMINDER

The July 15, 2020 nationwide deadline for filing an individual federal income tax return for tax year 2019, or requesting an extension, is approaching. It is also the deadline for you to make certain contributions to your Individual Retirement Accounts (IRAs),Roth IRAs, and Coverdell Education Savings Accounts.

The IRS contribution limit to an IRA for tax year 2019 is $6,000. However, anyone over age 50 and under age 70½* who has a traditional IRA is entitled to make an additional “catch-up” contribution of up to $1,000, for a total of $7,000. Roth IRA participants may continue to make annual contributions up to that $7,000 limit after age 70½.

Contact us today to coordinate your contribution or to establish and fund new retirement account before it’s too late.

The post Market Update – The “Hope” Trade is Costing You Money! appeared first on Capital CS Group.

By: Todd Carbone

Lately, we have been receiving several calls with the same sentiment; the market is going to start heading into negative territory due to the overall effects of the Corona Virus and the depression is coming, as soon as, the general population has run out of money. In addition, society is forecasting a potential second wave of Covid19 cases, which could have a negative impact on the market. These are all possibilities, but the real question, do you remain on the sidelines and wait to invest? In our humble opinion, we believe now is the time to invest, let us explain why.

If we tried to think of everything that could go wrong, we would go crazy; In fact, we probably would never leave our houses. On the contrary, maybe we should be crazy and think of everything that could go right! I personally was raised as a pessimist, were the glass was always half empty. Having been trained as a trader and investor, we are taught to not be emotional about the market. The market does not have feelings or emotions. The market does not care if we are feeling stressed or unable to sleep because an investment is moving in the wrong direction. Over the years, we have learned as traders and investors, the glass is not half empty or full, it simply does not exist.

The S&P 500 for 2020, is still down from its all-time high by 10.50% and is continuing to play catch up, while the Nasdaq is the current market leader. In addition, the small cap space, has also seen a strong comeback rally from the beginning of this year. With the small cap space making a comeback, this debunks the theory of going into a depression, since small caps are the first to break down when heading into a depression. In addition, the “VIX”, also known as the volatility index, which portrays cost of portfolio insurance in comparison to the level of risk in the market, has collapsed to 27.00 from 85.47, which is down 68%!

When looking back at our last article, the Nasdaq has rallied 45%! Did your emotions pay off by not investing in this opportunity? No, in fact it cost you money. Maybe your new perspective is you will wait for the next crash, then you can say “I told you so.” Where ever you stand as an investor, you need to ask yourself, when and what will make you comfortable, if anything?

In summary, the market is not pricing in a depression or collapse, so why should you? Is the market going to listen to us, definitely not. The trend is our friend, markets grow over time with a 55% probability of success. When starting to get your feet wet as an investor, it is important to start with smaller position sizes and most importantly, have a selling strategy if things do not happen as planned– remember, something all ways happens. Failing to prepare, is preparing to fail. Get off the sideline!!!

It is the Capital CS Group’s mission to change the way wealth is viewed, not as an independent journey, but as a path guided by a team of professional financial advisors and a proven goal based financial planning approach.

The Capital CS Group has demonstrated successful navigation of all types of markets through our in-depth financial planning process developed over our 28 years of industry experience.

The post Market Update – Failing to Prepare is Preparing to Fail appeared first on Capital CS Group.

Report by Todd Carbone

“The Dow Jones is on its worst pace since 1929, which in 1929 was a price drop of -89% from high to low. As of today, we are down -38% from high to low on the Dow Jones. One could argue that the Dow Jones is not a proper sample size to gauge the stock market because it is only 30 stocks and its price weighted. The S&P 500 which is a better sample size to gauge the market is down 35% from high to low. Anything down over 20% is consider a Bear market…. A lot of investors would say we were due for a market correction; there is some truth in that thought process. For there to be new buyers, there must be sellers to generate cash. Wallstreet will put money back to work eventually as there is a need to invest and make income and profits. The question is when?”

“After the biggest drop in the Dow Jones in October 1929, the Dow Jones did not have any real buying until 3 years later in April 1933. In 2008, the Dow Jones moved down 54% from high to low during the financial crisis from January 2008 to March 2009. The financial crisis was a market movement that took over 1 year and 3 months. During the Financial Crisis, it took the Federal Reserve about 6 months to act, due to the unique and complex situation.”

“In today’s market, we are once again in a unique situation. The quick selling and level of market damage has occurred in short period of time of only 5 weeks. This level of velocity has been the worst in history. The major difference between the 2008 Financial Crisis and our current market is the Federal Reserve has already acted! This time it took only 3 weeks versus 6 months it took the Federal Reserve to act in 2008. The real question, have stock prices found their bottom?

Through supply and demand, stocks will stabilize when supply and demand equalize. Can you buy stocks in this environment? Yes, but take caution. With any new purchases, in a volatile market, one day stock “XYZ” may be a good investment, then the next day its down 20%. This type of action is typical in a bear market. If you are a long-term investor and are comfortable buying a small position in the market, purchase a smaller position of 10% of what you would normally buy.

It is very difficult to buy something and discover the next day its down 20% when you could have just waited. Currently, analyst and economist are trying to price in the severity of this economic downturn. In the next coming weeks and months, the market will begin accessing the damage to the economy, the impact could take months or years to recover, the amount of time will be dependent on the institutions and business revival plans. We are in a drastically changing and unique time; thus, it is prudent to stay conservative and be cautious.”

“In summary, it is impossible to predict how long it will take the market to recover. The market

What has the federal government done to limit economic destruction of coronavirus?

The federal government is racing to ease the pain facing the U.S. economy as the coronavirus pandemic makes its swift pivot from public health crisis to financial catastrophe.

It is the Capital CS Group’s mission to change the way wealth is viewed, not as an independent journey, but as a path guided by a team of professional financial advisors and a proven goal based financial planning approach.

The Capital CS Group has demonstrated successful navigation of all types of markets through our in-depth financial planning process developed over our 28 years of industry experience.

THE CAPITAL CS GROUP REMAINS IN THE OFFICE TO GUIDE YOU THROUGH TODAY’S MARKET CONDITIONS.

downturn of 1929 took 3 years to recover and the financial crisis of 2008 took over a year to recover. We will know the current market conditions have changed when we see massive buying from institutions. Institutions have the most resources and capital to move the market. Our advice during this crazy time: Stay home with your family, watch some Amazon and Netflix, maybe pick up a new hobby, and stay healthy. Remember, the markets are independent from what we think or feel. Eventually through the oldest economic principle of supply and demand, the market will dictate a bottom when its ready. Stay tuned…

March 6th: Trump signs $8.3 billion emergency spending package
March 12th: Fed says it will pump more than $1 Trillion into the financial system.
March 13th: Trump gives people with student loans a break.
March 13th: Trump declares national emergency.
March 15th: Fed cuts rates to zero, launches $700 billion quantitative easing program.
March 17th: Fed takes new steps to keep money flowing.
March 18th: Trump signs Coronsvirus relief plan to expand paid leave.
March 20th: Trump invokes the Defense Production Act
March 20th: Education Department says borrowers can pause student loan payments, though they already could.
March 23rd: Fed pledges asset purchase with no limits.

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