We hope you got to spend some good quality time with family and friends this past Memorial Day.  Looking forward to 4th of July one of our personal favorite times of year.

Markets & Economy

After a slow April, the markets bounced back in May. The S&P 500 rose by 4.37%, recovering the losses from the previous month. So far this year, the total return is now at 11.30%.  However, not all indexes are performing the same. The S&P 500 Equal Weight Index, which we believe provides a better representation of the overall market, has increased by only 5.49%. This divergence between indexes is similar to what we’ve seen in recent years.

Let’s take a closer look at the S&P 500 Equal Weight Index and how market concentration in a few stocks compares to past trends. The first chart and commentary below (courtesy of The Kobeissi Letter via Goldman Sachs) highlight how much of this year’s gains in the S&P 500 are due to just five stocks. The commentary describes this as “truly remarkable.” We’ll let you see for yourself. The second chart and commentary (courtesy of Richard Bernstein Advisors) show the percentage of stocks outperforming the S&P 500 year-to-date. This rivals the levels seen in 1998-1999. The purpose of sharing these charts isn’t to predict the next market move but to illustrate the extraordinary times we’re in. History tells us that such conditions don’t last forever, although they can persist longer than many rational investors might expect.

As we enter the summer months of June, July, and August, markets often slow down, and returns can be more modest. Being an election year, there might be even more uncertainty and volatility as investors adopt a “wait and see” approach.  For now, the markets seem satisfied with the Federal Reserve’s stance on interest rates and the current state of employment and consumer confidence.

In our usual monthly charts, there haven’t been any significant changes. The Consumer Price Index (CPI) remains steady at around 3.3%, with only a slight decline in the “sticky” CPI. This indicates that the Federal Reserve isn’t making significant progress on reducing inflation. Commodities continue to trend upward, contributing to the persistence of inflation.

On the employment front, both continuing and initial claims for unemployment have seen a slight increase. We are monitoring this closely, as a noticeable decline in employment could signal a potential recession. Additionally, the Leading Economic Index hasn’t shown any real improvement, and consumer confidence has dipped slightly.

Overall, while there aren’t many positive trends, there isn’t anything overly concerning at the moment. This reflects the current market performance.

Tax Talk

FIVE RMD FACTS EVERY IRA OWNER SHOULD KNOW

If you have an IRA and you are approaching retirement age, you have probably heard the term “required minimum distribution” (RMD). But do you know the details of how the rules work and what they mean for you? Here are five facts about RMDs that every IRA owner should know.

  1. If you have a traditional IRA (including a SEP or SIMPLE IRA), you must take an RMD for each year beginning for the year you reach age 73. If you are still working, that will not delay when you must take an RMD from any IRAIf you have a Roth IRA, no RMDs are required during your lifetime. Converting your IRA to Roth IRA would result in no further RMDs being required in your lifetime.The deadline for taking your first RMD is your required beginning date, which is April 1 of the year following the year you reach age 73. This is the only time you will have beyond the calendar year to take your RMD. The deadline for taking your RMD for years after you reach age 73 is December 31If you delayed taking your first RMD until April 1 of the following year, you will then need to take another RMD by December 31 to satisfy the requirement for the second year.
  2. RMDS are calculated separately for each IRA, but then may be aggregated and the total amount taken from one IRA. You may not take the RMD for an IRA from your company plan or from your Roth IRA. You can aggregate traditional IRAs that you own. You can separately aggregate IRAs inherited from the same person. Your RMD may not be rolled over to another IRA or converted to a Roth IRA. Once you have satisfied your RMD for the year for your IRA, you may then roll over or convert the IRA.
  3. Your RMD is calculated by dividing your December 31 prior-year IRA balance by a life expectancy factor. The year-end balance may need to be adjusted in rare circumstances like rollovers or transfers that are outstanding on December 31 of the prior year. Life expectancy is determined using the Uniform Lifetime Table, unless the sole beneficiary of your IRA for the entire year is your spouse who is more than ten years younger than you. If that is the case, you would use the Joint Life Expectancy Table. Special rules apply for death and divorce when it comes to using this table.
  4. If you fail to take your RMD by the deadline there is 25% penalty on the amount of the shortfall. If you miss your RMD for the year, you should take it as soon as possible. You should consult with your tax advisor about filing Form 5329 and asking for a waiver of the penalty. The IRS will waive the penalty for good cause.

 

Rockport News

myRWinvest

As a reminder (or maybe new to you if we have not mentioned it) we have the myRWinvest platform which is an automated investing platform designed to help investors reach the financial goals that are important to them. This is ideal for small investments and those just looking to get started such as children and grandchildren. There is NO minimum investment amount.  This automated platform has:

  • Low-cost portfolios designed to meet each client’s specific objectives
  • A simple and intuitive client interface including performance reporting
  • Live updating of financial goals and progress reporting
  • Communication from Rockport Wealth professionals
  • Automated re-balancing* and trading to guide your portfolio

Additional info and sign up on our Website at www.rockportwealth.com.

Salute To Service Golf 2024

Lastly, our annual Salute to Service Golf outing benefiting our veterans is August 12th at Red Tail Golf Club in Avon, Ohio.  Thank you to those who have graciously contributed already.  If you would like to donate or sign up a group to golf please visit salutetoservcegolf.com

As always, if you have any questions on anything we have talked about here or anything else that is on your mind, please feel free to reach out.

 

*The Standard & Poor’s 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general. Results can be found at slickcharts.com.
*Treasury yields can be found at finance.yahoo.com.
*Charts produced at yCharts.com
*Bonds can be found at bloomberg.com/markets/rates-bonds
*Fed Rate Probability Chart can be found at cmegroup.com/markets/interest-rates/cme-fedwatch-too
*The LEI can be found at conference-board.org/topics/us-leading-indicators
*Treasury Yield Curve can be found at Gurufocus.com
*University of Michigan Consumer Confidence produced at SentimenTrader
*Rockport Models – Please remember we are referencing our model portfolios, and your portfolio may differ from the models mentioned depending on your individual needs and circumstance.

Share

Check the background of your financial professional on FINRA's BrokerCheck.

Securities offered by Registered Representatives through Private Client Services, Member FINRA/SIPC. Advisory products and services offered by Investment Advisory Representatives through Rockport Wealth Advisors, a Registered Investment Advisor. Private Client Services and Rockport Wealth Advisors are unaffiliated entities.

Rockport Wealth Advisors and J Arnold Wealth Management are dba’s of Rockport Wealth, LLC, a fee-based Registered Investment Adviser (RIA) registered with the Securities and Exchange Commission and offering a full range of professional services. The scope of any financial planning and/or consulting services to be provided depends upon the needs of the client and the terms of the engagement. Please see our CRS & ADV disclosure documents for more information about our business.

FINRA · SIPC · CRS & ADV · PCS Disclosures

Top

Introducing our Plan to Succeed Course