Client Newsletter: October 15, 2015

Hoover Financial AdvisorsOctober 15, 2015

Clients Newsletters

Market Summary

Benchmark Charts_3rd Quarter 2015 *click chart to enlarge

Turn Market Volatility into a Positive!

Over the last quarter, the various stock markets bounced about like a Mexican jumping bean. Some days up, some days down, some days up and down. Unfortunately, we saw more declines in the quarter than increases. Obviously, no one knows where the markets will go next, but a few positive strategies can be made from this recent market volatility.

Strategy 1 – Tax-Loss Harvesting

Your portfolio should be reviewed to determine if tax-loss harvesting could be helpful in saving some current tax dollars. Tax-loss harvesting involves selling securities that have realized losses. The losses can be used on your tax returns in the following three ways: 1) to offset any taxes due on capital gains; 2) to reduce other ordinary income by up to $3,000 per year; and 3) to carry over to future tax years to be used to offset capital gains and reduce other ordinary income up to $3,000.

Given the recent declines in some asset classes, we should be able to make sales to capture those losses, and use them to either offset other capital gains or reduce your tax liability. This should allow you to immediately save tax dollars when you file your tax return. You need to make sure you don’t create a wash sale by purchasing a substantially identical security. For more details about wash sale rules and tax-loss harvesting, read our October 1st blog Tax-Loss Harvesting – A strategy to share your losses with the U.S. Treasury written by John Furey, HFA’s senior tax advisor.

Strategy 2 – Rebalancing

Market volatility also offers opportunities to rebalance your portfolio back to your target asset allocation.  When your portfolio is rebalanced, overvalued securities are sold at higher prices and undervalued securities are purchased at lower prices. Rebalancing your portfolio is the best method to sell high and buy low. Our investment team is ready to make moves to rebalance your portfolio and take advantage of any buying opportunities presented by a short-term market decline.

Strategy 3 – Dollar Cost Averaging

Stock market declines are also beneficial when you are adding monies to your portfolio. The process of dollar cost averaging allows you to purchase securities at the current market price. When prices are low, more shares are purchased and this helps to reduce your cost per share and generate more profits when markets increase. Investing money on a systematic basis allows you to take advantage of price declines to create more market gains in the future.

Please feel free to contact your advisor to discuss any of these strategies you can utilize to take full advantage of the stock market volatility!

Fall Seminar: Liz Ann Sonders

Our Fall Seminar is quickly approaching! Featured guest speaker Liz Ann Sonders, Chief Investment Strategist at Charles Schwab & Co. will speak on October 29th at Penn State Great Valley in Malvern, PA.  Registration begins at 4:30 PM and the program starts at 5:00 PM. Following the presentation, enjoy a casual dinner reception with other attendees. If you have not responded – please contact Danielle Marinelli at 610-651-2777 x101 or danielle@petehoover.com.

Also, do not forget that you are more than welcome to bring guests along with you to this event.  For every guest you bring, you will have the chance to win a $100 VISA gift card raffle prize! The entire HFA staff is very excited about this event. We look forward to seeing you there!

Fall Funds for Food Campaign

The month of October has become HFA’s Fall Funds for Food Month, when we collect money to support the Chester County Food Bank and its programs.  Last year, HFA set a goal to raise $10,000 and actually brought in $12,500!  This year, with your help, we are hoping we can reach $15,000. For each dollar contributed, the food bank can provide four meals or five pounds of non-perishable food.

Our fund raising program has become a very valuable contribution to the Food Bank and its programs. There are over 70,000 local households that do not have enough food to feed their families. Chester County Food Bank distributes food to more than 30 local food cupboards and 60 other meal sites and agencies at no charge. We hope you will share our passion for this wonderful organization by showing your support with a donation.

If you would like to donate, please mail or drop off a check made out to Chester County Food Bank to HFA’s office at 112 Moores Road, Suite 100, Malvern, PA 19355. The drive will conclude on Saturday, October 31st.  Thank you in advance for joining us to help support the Chester County Food Bank.

Employee Updates

HFA is pleased to announce and welcome the newest member to our team, Thomas Balis. Thomas has accepted an Investment Analyst position and is currently working with Phil Gagliardi and Tim Grove in our Investment department. His primary responsibilities include the daily management and monitoring of client accounts to ensure proper asset allocation. He is also collaborating with the Investment department on value-added investment solutions to better serve our clients.

Thomas is a highly experienced financial services professional. Prior to HFA, he managed 21 H&R Block retail tax offices in Orlando, Florida. Before that, he was first vice president, district manager for 16 JP Morgan Chase Bank branches in Tampa.  He and his family relocated to King of Prussia earlier this year. He holds a bachelor’s of science degree in Business Administration from Ohio State University. His background, investment expertise and keen analytical skills have made him a wonderful addition to the team!

Contact Information:

Thomas Balis – Phone: 610-651-2777, Ext. 123 and Email: thomas@petehoover.com

As always, please do not hesitate to contact our office if there have been any changes within your financial situation.  We look forward to continuing to be of service to you in the future.

Best Regards,

Peter K. Hoover, CFP®


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