Allgen Financial Services has recently received a significant amount of press for its innovative approach to fostering relationships with its clients and members of the business community by using social media such as Twitter.
“As a retirement investment advisory firm, we are on the cutting-edge in our thinking and approach to relationship connectivity. We have our finger on the pulse for how individuals and businesses are communicating with each other in 2009,” said James Zimbardi, Senior Partner at Allgen Financial Services, Inc.
The latest article published has been written by Beth Kassab of the Orlando Sentinel. She has been carefully tracking the value of Twitter in the marketplace for the last few months.
The market has its eyes on a retest of the November lows for the last month and the first test of those lows was a successful bounce. This doesn’t mean we will start into a new bull market, but it is an incremental positive. Last years November lows for the S&P 500 were at 741, yesterday’s low was 742 (chart below). Today the S&P 500 rallied 4% and volume was higher across the board. This support level is very important and we will see if the market can continue to hold and hopefully go higher from here. At the same time we will be on guard in case the market breaks below this important support level. If the market breaks below support we will sell our weaker holdings and add to our cash levels until markets stabilize.
We realize the news about economy is extremely weak, but it should be noted there are a few bullish characteristics visible if you do some sector and style analysis. For example, year-to-date two of the best performing sectors are information technology and biotechnology. Also, growth stocks as a whole are outperforming value stocks handily. Additionally, the NASDAQ considered more of a growth-type index has been much more resilient than the S&P 500, and is significantly above its November lows. These three examples are bullish characteristics, and are usually apparent as you enter an expansionary cycle of the economy. It’s is also important to note the market is forward-looking so even though we are currently in a contracting economy, the very next stage of the economic cycle is expansion. So, if expansionary stocks are doing better than the rest of the market, this is usually a sign of good things to come. However, to reiterate, this is only one up day and we are taking it one day at a time.
The Nasdaq (pictured below) along with the other major indices broke below short-term support. After a failed breakout above the 1600 level which was discussed in last week’s commentary the Nasdaq has shed 10% in one week and broke below support of 1500. If the Nasdaq is unable to bounce back above 1500 then we will probably head down to the next are of support which is at 1400. The weakest areas in the market over the last few days have been banks and commodities, which had rallied strong since the market bottomed in November. To point out some major bank names and their respective price levels; Citigroup closed at $4.53 and is closing in on its November low of $3.05, a close below $3 for Citigroup would be seen as a very negative sign for the company. Bank of America closed at $10.20, its lowest close since 1992. If Bank of America closes below $10 that would be a serious break down technically and would probably lead to further down leg.
Allgen Financial Services Investment Strategy:
Over the last few days we took some profits in a commodity, more specifically a fertilizer company and we sold a community bank which had held up over the last year until this week. Are level of cash is now higher and we will maintain the higher level of cash until the market shows some sign of holding support and turning around.
Only 27 percent of workers are very confident that they will have enough money to live comfortably throughout retirement; 29 percent of those surveyed admitted that they are either not too confident or not confident at all.
Fifty-one percent of workers aged 55 or older have total savings and investments of less than $100,000.
About one-quarter of workers believe they need to save less than $250,000 to achieve a comfortable retirement.
Source: “Saving for Retirement in America,” Retirement Confidence Survey, 2007, Employee Benefit Research Institute and Mathew Greenwald & Associates.
At one time, Social Security was considered the primary source of income for retirees. Even among today’s retirees, it provides a significant portion of their income. According to the most recent figures available from the Social Security Administration, in 2004, Social Security provided more than half of the total income for almost two-thirds of households comprised exclusively of those aged 65 and older; and at least 90 percent of the income for one-third of this group.
Source: “Social Security and Retirement Income Adequacy,” Social Security Brief, May, 2007.
For professional investment advice on this topic contact: Allgen Financial Services, Inc.
888.6ALLGEN (888) 625-5436
advisors@allgenfinancial.com www.allgenfinancial.com
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