240 South Pineapple Avenue, Suite 200  Sarasota, Florida  34236

You can find reports from our Investment and Research team, timely and informative financial planning topics from our Wealth Management team, and deeper dives on various important topics in our white papers from any team member. Read online, share with friends, or download for your convenience.

APA Vorndran 3x4HI RGBAllegiant Private Advisors is pleased to announce that Paraplanner Kristina (KJ) Vorndran, CFP®, CRPC®, has earned the Chartered Retirement Planning Counselor® designation. 

The CRPC® program focuses on the entirety of the retirement planning process, encompassing pre-and post-retirement needs from sources of retirement income including personal savings and employer-sponsored retirement plans to income taxes, retirement cash flow, Medicare, asset management and estate planning. Individuals who hold the CRPC® designation must complete a course of study, pass an examination and adhere to standards of professional conduct.

Chart Growth Stocks vs Value Stocks
The chart above shows the relative performance of growth stocks compared to value stocks over ten-year periods dating back to 1937. The blue bars illustrate ten-year periods where value stocks outperformed growth, while the red bars indicate periods where growth stocks outpaced value. As you can see, value stocks have generally outperformed growth stocks – over 75% of the time to be exact. However, over the last ten years, growth has outperformed value by almost 4% per year – the second worst relative ten-year period for value stocks. While many investors and market commentators tout this as a reason to shift more money into growth stocks, we prefer to not let recent performance influence our expectations for market returns. So, while value investors may be kicking themselves right now, it is more than likely that over the long-run value stocks will continue to reward their shareholders with strong returns. 

Investments are subject to risk, including the loss of principal. Some investments are not suitable for all investors, and there is no guarantee that any investing goal will be met. Past performance is no guarantee of future results. Talk to your financial advisor before making any investing decisions.

Portfolio Manager Luke Nicholas, CFP®, CFAAPA Nicholas 3x4HI RGB, earned a promotion to Principal in January 2019, but even greater things are in store for him over the next year. We invite you to get to know Luke better, in his own words:

It is hard to believe that I am quickly approaching my six-year anniversary at Allegiant Private Advisors. I consider myself extremely blessed to have found a company with such an accomplished, close-knit team and incredible client base. While the financial industry is rife with sales-driven quotas and greed, I am proud to know that all of my co-workers and I come to work every day with only one thing in mind – providing top-level, fiduciary guidance for our clients. Before I dive into my time at Allegiant further, let me take a step back and tell you how I got here. 

Chart Construction Spending

Construction spending is a great indicator of the health of the underlying economy and therefore one that the team at Allegiant likes to track closely. The chart above shows the year-over-year growth rate of construction spending broken down in two main categories: residential and non-residential. Although the total construction spending (dotted line) growth is still positive, the growth rate has been declining for almost six years. The real drag on construction spending growth recently has been the residential segment (grey line), which turned negative on a year-over-year basis late last year. The housing market has been confronted with rising material and labor costs, along with rising interest rates – which have both hurt homebuyer affordability. While non-residential spending (gold line) has remained strong, largely driven by a recent surge in government-related spending, the drop off in residential housing is a concern. If in fact the declining spending is signifying a looming slowdown in the housing market, that could have a significant impact on the economy. Coupled with additional economic indicators, the construction data supports our narrative that economic growth is set to slow in 2019 after the one-time boost of the tax cut. 

The Allegiant Private Advisors team regularly helps guide our client families through many of the most crucial decisions in life, from purchasing a new business or preparing portfolios to support living life to its fullest, to the important duty of planning legacy gifts.

Many people wish to leave a gift to charity when they pass away. These legacy gifts are often outlined in a Will or Trust agreement. While this path works for many people, there may be a more tax-effective way to gift to charities after your death: naming them as the beneficiary of your IRA. This strategy can improve outcomes for all parties involved and can be especially attractive for those wishing to leave money to a mix of charities and family members, especially those in high tax rates. 


Should We Be Worried? Here’s Your Call to Action.

A lot has happened since last month’s commentary. The February employment report came in well below expectations (20,000 versus 180,000 new jobs). The Federal Reserve reacted by shifting course and announced a dovish stance on interest rates and monetary policy. Global manufacturing PMIs declined more than expected. And finally, the big change, the one worth noting above everything else, was a dramatic drop in long-term interest rates, leading to a very important inversion of the yield curve. Click here to read Allegiant's Monthly Insights: March 2019.

Chart ISM Services Breakdown

This month’s ISM Services reading came in at a very strong 59.7. Prior to this report, the past few ISM readings had shown some weakness, which was a concerning sign for a domestic economy that is comprised of primarily service-based businesses. More concerning than the down trend in the headline Services PMI number was the sharper decline in some of the segments that roll up into the headline number, such as new orders and backlog. New orders give some insight into the spending businesses are experiencing, while backlog gives us details about how strong a company’s existing pipeline of work is. The fact that almost all of the reported segments rebounded so nicely is encouraging given some of the geopolitical and trade related risks that are looming. Overall, the report showed that the U.S. economy has entered 2019 on solid footing.

Fourth Quarter GDP Report Updated

Gross Domestic Product (GDP) rose by 2.2% in the fourth quarter, which was in line with expectations. For the year, GDP grew 2.9%, matching 2015 for the strongest annual growth since the Great Recession. The consumer proved very resilient in the fourth quarter, with consumption up 2.5% despite stock market volatility and a partial government shutdown. Business investment also positively contributed 0.7% to GDP, although recent trends in durable goods orders show that this may be losing momentum. The consumer and business gains were partially offset by several factors. Housing related spending has now contracted in each of the last four quarters. Also, government consumption subtracted 0.1% from GDP compared to Q3 where it added 0.4%. This was largely expected given the partial government shutdown. The GDP report shows that although growth did slow some from earlier in 2018, the U.S. economy ended the year on very solid footing. However, as the effects from last year’s tax cuts begin to fade, we expect growth to moderate in 2019.

EstatePlanning Tree APA 750x350

The transfer of wealth to heirs through your estate plan communicates many things to those we leave behind. It says who is remembered, who is loved, who is important, and who we trust to be in charge. Therefore, dividing assets between your children can be a stressful ordeal. Many parents want to be fair to everyone, interpreted as an even split of all assets. For some families, however, an even split doesn’t make the most sense. How you handle this delicate situation with your own family depends on many personal factors. 

Sometimes being fair doesn’t mean being even when it comes to estate planning, but - in all cases - family meetings can help.

Click here to read more about the Allegiant Private Advisors team’s perspective in a new article on SarasotaMagazine.com.

In the 1975 political thriller film “Three Days of the Condor,” Robert Redford plays a CIA analyst working in a clandestine office where they endlessly read disparate books, newspapers, and magazines from around the world to discern trends, hidden meanings, and other useful information that might be buried in the noise.
Allegiant's newest white paper by our Chief Operating Officer and Principal Paul Cantor, CFA, AIF®, CFP®, is similarly an attempt to link a myriad of mega-trends and world events into a tapestry of potential outcomes, and the policies required to get there.

Click here to read The Devolution of Globalization.