Perspectives Blog

Three reasons why REITs can continue to rally

Arthur Hurley, CFA, Senior Portfolio Manager | May 19, 2014

REITs have produced attractive returns YTD being up 13.60% through April (up 16% as of May 12) Fundamentals remain solid, demand for commercial real estate remains strong and companies continue to increase dividends. We remain positive on REITs given the relative safety of their income stream and continued prospects for growth. The REIT market shook off the cold of the “polar vortex” with both solid share price performance and continued positi…

Slow growth: Why is it here and will it stay?

February 24, 2014

There is no consensus on the root causes of slow growth. As economists seek explanations, the secular stagnation theory has re-emerged. Strong evidence suggests the neutral real rate has fallen. (But is it negative? We explore this question in this continuing series over the next few weeks.) By Marie Schofield, Chief Economist and Toby Nangle, Head of Multi Asset Allocation The idea that economies may be undergoing a long period of slow growth…

Half-time report on the U.S. consumer

Marie M. Schofield, CFA, Chief Economist and Senior Portfolio Manager | July 28, 2014

U.S. consumers have taken a more cautious attitude toward debt and been more selective about using it for discretionary purchases. With consumers using credit cards less and using debit cards much more, the supports for higher discretionary spending are keyed off income and wages and also employment. With low debt use and income growth holding back consumption and demand, households will require stronger job growth and real wage gains to accele…

U.S. rates – Headwinds

Zach Pandl, Portfolio Manager and Strategist | March 17, 2014

At this week’s meeting, the Federal Open Market Committee looks likely to rework its forward guidance for short-term interest rates once again. We expect revised forward guidance to lean heavily on the idea of “headwinds”; this is a stand-in term for a low equilibrium real rate. We expect that the new guidance will make three main points: (1) that the FOMC is in no hurry to raise rates, (2) that rate hikes can proceed gradually once…

Capture five tax benefits with a 529 college savings plan

Columbia Management, Investment Team | March 21, 2014

By contributing to a 529 plan, you may benefit from tax advantages — without giving up control of plan assets. As an estate planning tool, 529 plans may allow removal of significant assets from your taxable estate. Investment growth in a 529 plan, as well as distributions, is not subject to the new 3.8% net investment income surtax. Owning a home. A financially secure retirement. A college education for a child or grandchild. These are a…

Does a perfect policy portfolio exist?

Jeffrey Knight, CFA, Global Head of Investment Solutions and Asset Allocation | May 5, 2014

…set class. Intuitively, Risk Parity strategies extract a greater diversification benefit than portfolios that are unbalanced in their risk allocations. For the most part, the theoretical benefits of these strategies have been realized in the real world, as investors who have been willing to invest this way have generally enjoyed higher risk-adjusted returns and lower drawdowns than traditional 60/40 portfolios. Some managers even tout Risk Parity…

Saving for college — What’s the real cost of waiting?

Columbia Management, Investment Team | September 16, 2013

…ction. Also note that implementing a savings plan can provide relatives who would like to help – such as grandparents – with a way to do so more effectively. Consider working with a professional financial advisor to develop a realistic savings plan specific to your needs. Once you have a college savings strategy mapped out, don’t let it gather dust. A “Cost of Waiting” calculator can help you see just how much it could cost you for each year you…