KFA Blog

Senior Trading and Research Specialist


Influenced at an early age her father who often talked about investing and actively bought and sold stocks, Lisa developed a love of the markets. This passion lead her to a career in financial services. Lisa started in the financial services industry after college.  She began in 1990 working on the retail side. Today Lisa's main area of focus is researching new investment ideas for clients’ portfolios.  She also maintains the firm’s internal information and communication to ensure we are aware of any news regarding our investments and the impact it has on our portfolios.  Another main area of focus is on placing investment trades as well as maintaining client asset allocations that coincide with the individual objectives and risk tolerance.  She received a Bachelor's degree in Business from DePaul University in Chicago. In her spare time, Lisa enjoys spending time with her children and family, attending sporting events, and volunteering for her children’s activities.  Lisa enjoys doing yoga, walking her dog and skiing. Lisa can be reached by email at: info@kabarec.com  

Market Conditions - Mr. Wonderful to Mr. Doom and Gloom

By:  Lisa Thuer - Senior Trading and Research Specialist

January 2016 will go down as one of the worst if not THE worst January since 1937. It began down and continued free falling with a few positive days in between to end the final trading day of January 2016 with the Dow up nearly 400 points. We feel like we have been bungee jumping for the past month. Ending the month on a positive note going into the weekend is always an added bonus.
Let’s take a look back and see what happened and what is going on in the bear and bull camps. In the past several weeks, we have attended conferences and luncheons with the best analysts around the country to hear their perspective on the markets and where to go from here, including Kevin O’Leary from Shark Tank to Mark Faber, publisher of Gloom Boom & Doom Report. Unfortunately they are divided in their ways of thinking.
Bear Camp: Mark Yusko from Morgan Creek and Jeffrey Gundlach from Doubleline Capital are calling for a recession based on weakness in the manufacturing sector. They claim the Federal Reserve will lead us into a recession by raising rates. Then there is the surplus of oil which even though it is a positive for some of us, it is negatively effecting certain areas of the country such as, Houston and North Dakota. The slowdown in China with other countries exporting goods to China will reduce their bottom line. The strong dollar also making our exports expensive and impacting corporate profits to the downside.
Bull Camp: Professor Jeremy Siegel of WisdomTree and Liz Ann Sonders, Charles Schwab’s Chief Investment Strategist are cautiously optimistic. We had the honor of listening to them speak this past week. You could say that our views relate more to them than the Bear Camp. Professor Siegel believes that oil should stabilize around $40 and chances are the Fed will not raise rates anymore this year. Both Professor Siegel Liz Ann are basically in the same cautious bull camp and believe we will have a positive finish in 2016. All the worry on China but U.S. has small exposure to the country. Whenever the Fed raises rates, volatility becomes the norm. Slowly raising rates is good for the markets as long as it is not too fast. We may be approaching a mature bull market and realistic returns will be in the single digits.
KFA Camp: We also are cautiously optimistic. How is this reflected in your portfolio. KFA is not market timers. Sure it would be great to be able to always buy low sell high and be in all cash when the market drops. We have taken risk off the table and based on research and fundamentals. There is not always a clear signal to sell when the floor is dropping out and consumer sentiment is negative when in reality the data isn’t bad. So what are we doing? Alternatives have been added as a portfolio stabilizer, utilities and preferred stocks have been added to lower the volatility and receive a dividend yield of 3.5% and 5.5%, respectively. We remain overweight in healthcare, technology and financials, even though they did have a big draw down in January, they remain sound investments and this is where the future of innovation will prevail. Furthermore, we will continue to add quality dividend holdings to your portfolio. KFA has chosen not to panic and listen to only our trusted sources of research. There are opportunities in the market and we are looking for signs of stability and have begun to nibble at the markets.
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Market Conditions - January 14, 2016 Update

By:  Lisa Thuer - Senior Trading and Research Specialist

We are sure that all of you know by now, the US stock market has started the New Year, with the worst performance in history.  Gloom and doom, is once again the rage on Wall Street and the fear mongers are out in full force, speaking on the radio and television.

One major international bank, The Royal Bank of Scotland, has made the bold call to sell “everything” based on world economic conditions. On the contrary, Morgan Stanley has stated that it remains optimistic and to “keep calm and carry on”.

What should we do as investors in the climate of uncertainty and volatility?

There are many unknowns as we head into 2016, such as potential Federal Reserve interest rate hikes and slowing global economy, also, will China go into a deeper recession.

However there are some known factors, such as:

  • Inflation remains low 
  • Interest rates remain low 
  • Energy prices are low 
  • The employment picture is improving 
  • The bond market is stable 
  • Major corporations have strong balance sheets

As we write this letter, the fourth quarter earnings reporting season has just begun. We do expect earnings to be reasonably good, with some of the earnings based on somewhat lower expectations. These good earnings should help stabilize the shaky market.  

At KFA, we are not going to let fear pull us into chaos. We will continue to focus on high quality investments and our diversified asset allocation strategies. For most clients we have purchased defensive positions or portfolios stabilizers, as well as selling non-core underperformers.

As we move forward, this market correction may be an opportunity to purchase stock and bond investments at reasonable prices.

Please call us if you have any specific concerns, we are always happy to hear from our clients. Thanks you for your continued confidence in us, we wish you a prosperous 2016.

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Market Conditions - Déjà vu?

By:  Lisa Thuer - Senior Trading and Research Specialist

New Year, new beginning for the markets, right?  Not so fast.  The past two days have felt like August all over again on the first two trading days of 2016.

Hangover from 2015

2015 was less than stellar in comparison to the past several years. Uneasiness remains as to how 2016 will begin and play out. The Fed began to raise the long anticipated rate by .25% bases points which really is not a big deal in the big picture. Now the concern is will Janet Yellen, the Federal Reserve Chair, raise rates four times in 2016 as stated in her press conference in December, 2015. Also, with global growth slowing and a strong dollar – how will this affect corporate earnings? 

China market halts trading

China markets halted trading when they dropped 7% on news of weaker-than-expected manufacturing data and a falling currency. Again, as stated previously this summer, the correct GDP number is really unknown which leaves a lot of room for speculation on the growth of the economy in China. But again, China has been slowing and this is not new news.

Geopolitical tensions heat up

Saudi Arabia decided to cut ties with Iran on Sunday. Will this lead to oil disruption or will the tension send oil prices even lower?

Weak ISM data

On top of all the other bad news that came out overnight, this morning it was reported that the index of national factory activity fell fractionally and also construction spending declined slightly.

What all this means for your portfolio. Volatility will become the new norm for the stock market. “Buy low sell high” but be picky and choosy needs to be added to that phrase.  The U.S. market held up relatively well on Monday in comparison to other markets especially China. China was down 7% and the U.S. Markets closed down only approximately 1.6% in comparison, showing strong resilience. The Chinese market that is affected is the A Share Market which can only be traded in China. Some of the selloff could be noted as “misery loves company”.  Oil and the energy sector continue to weigh on markets. We are looking for the energy sector to find a bottom and some stability but at least in the meantime it is money in your pockets, as consumers. The fear of four rate hikes in 2016 is on many investors’ minds. Janet Yellen will keep a close eye on the global economy and raise rates as necessary and has stated she will do so as the economy improves. We will wait and see as corporations begin to report earnings, beginning in the next month, to give us guidance as to how the economy is doing as a whole. To put things into perspective, as stated, “Netflix subscribers are not going to stop their subscription because the stock is down 4%”.

KFA’s team will continue to watch closely and look for opportunities as they arise. In the meantime, thank you for your continued confidence in our team.

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What If....

By:  Lisa Thuer - Senior Trading and Research Specialist

No one ever wants to talk about the day your loved one passes away and what needs to be done when the day comes.  It is the “elephant in the room”. Everyone knows they will be faced with it one day, but how many times have we said “We will talk about it tomorrow”.  Then it happens, now what?? We never had“the talk”. What do I do? Who do I call? Is there a Trust? Is there a Will? Who are the beneficiaries? Who gets the house? What happens to the investments? Why did we not have “the talk”?

Make one phone call to Kabarec Financial Advisors, Ltd.; we should be the first call before you call an attorney.  We deal with these questions on a daily basis and will help you every step of the way. Our clients are not only our customers but they are part of our family. We know more about our clients than just their investments and will be able to guide you through this most difficult journey. The majority of the time we will know who the beneficiarie(s) are and who the successor trustee(s) are on the account(s). Once this is established, the rest is routine paperwork as long as we have a certified death certificate. If there is an investment, life insurance policy, etc. outside of our office, KFA will be able to point you in the right direction.

Throughout our relationships with clients, we have made it our priority to give clients piece of mind should something happen to them. We have as much information of their financial life that has been shared with us in confidence. Knowing our clients for their lifetimes, helps us in preparation for when something does happen, we are there for their family in any capacity that is needed. 

Some families may have “the talk” in preparation of the inevitable and some families may not. The time may have come too soon and there was not time for the discussion. In any event, please do not hesitate to make Kabarec Financial Advisors, Ltd. your first phone call when something does happen. We are also available should you need help in preparation of “the talk”, we can also assist with this difficult situation.


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1st Quarter 2015 Market Commentary

By:  Lisa Thuer - Senior Trading and Research Specialist


Interest Rate Hikes, Strong Dollar, Falling Oil Prices and Stock Volatility    

First Quarter of 2015 has come to a close and it looks the same when the weather tried to slow the economy the first quarter of 2014. Cold and unusually bad weather has affected the economy. Despite the weather, the overall U.S. economy continues to show steady improvement, but still slower than many of us would like. The U.S. Corporate sector remains strong, with modest job creation. Most economists expect corporations to begin sizable expenditures in plant and equipment over the next several years as most companies have deferred spending until the economy improved. Of course this capital spending will further grow our economy and add all important well-paying jobs.

While the U.S. economy is improving, the European’s economy is still near a recession. The European Central Bank, (is equivalent to our Federal Reserve) has taken the first steps toward stimulating their economies, or similar to our Fed’s quantitative easing. These steps have been well received and the European stock and bond market enjoyed a good first quarter.

China’s growth is slower than the past, but their economy overall seems to be in really good shape. China is becoming more of a producer of goods for its domestic market as its population continues to enjoy an increase in their standard of living. Overtime, exports to the rest of the world may slow.

Japanese economy, despite all the government stimulus still cannot grow at the rate it needs to solve its decades old problem of deflation. Because of the potential seen in the stimulus, the Japanese stock market has seen steady growth over the last year.

(Read More.....)


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