VettaFi's Rosenbluth says rate cuts are a time to go active in bond funds

10/17/24 • 61 min

Todd Rosenbluth, head of research at VettaFi, says that the start of a rate-cutting cycle is a time when investors will want low-cost active management — rather than an index fund — in the fixed-income space. To that end, he picks a T. Rowe Price fund that uses a quantitative management style as his ETF of the Week, noting it can do the job for investors looking to diversify their fixed-income holdings. Jessica Johnston, senior director for NCOA's Center for Economic Well-Being In the U.S., discusses a recent survey by the group which showed that 80 percent of older Americans face a real risk of financial insecurity, Chuck discusses what investors and savers are facing — regardless of which side wins the election — when it comes to decisions on tax legislation that expires in 2025, covering everything from tax rates and the standard deduction to the child tax credit,estate tax exemptions and much more. And in the Market Call, Kathy Boyle of Chapin Hill Advisors discusses how she uses ETFs in pursuing core-and-explore investment strategy.

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Chuck's Halloween 'Trade or treat' has a new twist for kids this year

For about a decade, Chuck has offered the kids in his neighborhood a chance to pick cash or candy, to decide between a trade or a treat. It's part of his belief that even young kids are able to understand and make basic financial decisions, deciding if they would rather have candy or if the financial prize is worth more to them because it's different and more useful than candy. He always encourages others to put their own stamp on the idea with kids in their neighborhood, but each year Chuck also tweaks the game, making subtle changes to keep things interesting for the kids (and himself). This year, he is making a change to the "lottery option" that might make it appear that the children have a better chance at winning big by going that route, but instead makes it so that the children would almost certainly be better off picking any choice but the lottery option. Phil Moeller, author of "Get What's Yours for Medicare: Maximize Your Coverage, Minimize Your Costs," discusses the daunting process that Americans face in trying to maximize their money and health-care coverage under the Medicare program; Moeller believes that the most valuable unread documents in America are Medicare enrollment documents. Plus Joe Schmitz Jr. of Peak Retirement Planning answers three questions from audience members all about converting traditional IRAs to Roth IRAs, and how to determine if paying taxes now is worth the ability to never pay taxes on the investments later.

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As rates start to fall, Hennessy's Ellison sees "sunny days ahead" for banks

David Ellison, Portfolio Manager and Financial Services Specialist at the Hennessy Funds, says that the banking industry is coming out of "a two-to five year period of darkness," heading for "sunny days ahead," though he notes that banks do not want interest rates to fall too far but he thinks earnings can grow even if the Federal Reserve cuts rates by another 1 percent or more. Ellison also notes that anticipated problems in commercial real estate — considered a real threat to the health of the banking system — aren't likely to materialize as a real threat now because the industry has spent the last two-plus years preparing for trouble. "It may be a drag here and there, but it won't be a blow-up problem," he says. Dana Staggs, President of Arrowmark Financial Corp., looks at a high-yielding alternative to standard banking plays, talking about how his closed-end fund relies on regulatory capital relief securities — esoteric investments that currently can generate yields of up to 15 percent — and that should hold up when rates get cut further in the coming year. Jason Brown of The Brown Report says that the stock market's technicals are showing him signs that a big downturn is in the offing, and Portfolio Manager Michael Roomberg of Miller/Howard Investments, talks energy stocks in the Market Call.