Psychology 101

Behavior of the American individual investor has become an integral part of my market observations. We keep seeing reports that consumer sentiment is becoming more positive; however there is still more cash on the sidelines than stock ownership. Portfolio management discipline dictates that with this level of positive consumer environment, which has persisted since February 6, playing a little defense here should be implemented. Cash positions will rise based on some profit taking which is ongoing until we either see sentiment retract or bond yields rise as bonds are sold and equities are purchased.

What we need is a market correction; otherwise the current bull market will become more dysfunctional due to the narrow participation of buyers. The market is still undervalued and the Fed’s relentless printing of money to fuel the bull will continue but buyers support may dampen the upside movement while entry points are formed. My point is that a little correction here should result in higher prices later.

My thanks to all of you that attended our workshops last week on Conscious Investing. I appreciate the support and we are already working on another one.



About billriley

Chief Executive Officer, Chief Compliance Officer A co-founder and shareholder, William Riley is a 33 year industry veteran, who observed, many years ago, that over time institutional investors typically outperform individual investors while accepting less risk. In his role as Chief Executive Officer, Bill works tirelessly to make the wealth management strategies used by the world’s wealthiest families and largest institutions available to our firm’s individual clients. Bill combines fundamental and technical analysis to minimize investment portfolio risk and maximize potential returns. He uses a variety of non-correlated asset classes, including alternative investments, to minimize portfolio volatility and seek absolute returns in down or flat markets. Finally, Bill believes in a comprehensive approach to wealth management that fully coordinates and seamlessly integrates portfolio management, risk management and asset protection, trust, estate, tax and charitable planning. Prior to co-founding Riley Wealth Management ,LLC, Bill held management positions at Merrill Lynch, UBS, Raymond James, Paine Webber and J.C. Bradford. Bill founded Fort Worth branches for Raymond James and J.C. Bradford. Prior to entering the financial services industry, Bill ran his families closely held businesses. Bill’s experience operating family businesses combined with his wealth management experience makes him uniquely qualified to advise entrepreneurs and business owners on a variety of matters including complex and sensitive issues relating to business succession. Bill’s degrees and designations included a Masters Degree in Business Administration (MBA), the Chartered Financial Consultant designation (ChFC), the Chartered Life Underwriter designation (CLU) and the Wealth Management Specialist designation (WMS). A Fort Worth native, Bill is a TCU alum and active in many civic and charitable organizations. Bill and his wife, Marsha, now reside in Colleyville, and they have four grown children and four grandchildren. When he is not working on portfolios or studying financial markets, Bill can be found on the golf courses of Ridglea Country Club.
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