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MESSAGE FROM THE CIO : WELCOMING 2017

HAPPY NEW YEAR & WELCOME 2017!

First of all, we want to thank you for your trust and confidence in our firm. Heading into 2017 BluePrint Wealth Alliance is poised to reach over $100 million in assets under management and it would not be possible if not for each and every one of our fantastic clients.
We have been hard at work integrating new staff, technology and investment offerings and hope they will enhance your financial planning and investment experience even further. We are looking forward to personally sharing all the new enhancements in the coming months. Here is to another great year in 2017
 

4th Quarter Review

As expected the 4th quarter of 2016 did not disappoint! Unprecedented in many ways, the stock market has reacted favorably thus far to what most pundits and experts considered to be an extreme election outcome followed by a rate increase of .25% by the federal reserve with the prospect of additional hikes in 2017.
On balance, the prospects of a President Trump along with a rising rate environment has produced a positive effect on equity markets, negative on bonds and rate sensitive assets, US dollar positive and more “certainty” on policy than before the election. Leaving the US broad market with a rather respectable return in the 4th quarter of 2016 and overall for the year.
Foreign markets, in aggregate, were (again) under performers vs the US, but showed positive gains with emerging market equities besting their developed market counterparts and in certain regions even out performing the US.
Bonds are another matter, as they could not overcome a large, but orderly, move up in rates at all ends of the yield curve since bottoming at historic lows in the summer. Thus causing a giveback to the majority gains and out-performance enjoyed in the first half of the year ending with dismal showing in the 4th quarter.
This is why our preferred mode of operation when it comes to managing our client’s wealth is to rely on our evidence and rules based investment process. This includes not trying to forecast outcomes nor second guessing the market but rather reacting to the message the markets provide us in real time.
We feel our value lies in managing multi-strategy hybrid and tactical portfolio approaches that can allow us to participate both in up-trending markets but also have a sell discipline in downtrending markets. Most clients we work with are not seeking to “ride the wave” up and down
and look to us to provide a potentially smarter and smoother ride to their investment goals and objectives.

 

1ST QUARTER OUTLOOK

With the start of every new quarter we normally re-align (also known as “rebalance”) the tactical components of our investment models. For some clients, the tactical portion of their portfolio may make up the majority or ALL of their portfolio. For others, it may be more of an enhancement to a core set of longer term investment holdings.
During the rebalance process we will refresh the portfolio with the aim of buying new asset classes showing recent strength into the model, reducing or eliminating laggard positions and keeping those that are working undisturbed. Similar to how a basketball coach may make the decision of taking out a tired player off the court for fresh legs or may decide to leave the player with the “hot hand” in for extra minutes, the tactical model employs a rules based process to help make these allocation decisions.
As we enter the 1st quarter, it should be noted we remain in the historically positive months of the market calendar which runs November through April also known as “market seasonality”. While not a perfect indicator, as none are, history and market research has shown that the market has had better returns over this period historically vs the period running from May through October, coining the phrase “sell in May and go away”.
Small and mid cap sectors continue displaying leadership and value areas of the market are starting to gain vs. growth areas. Broad US market leadership continues to be the dominant theme for global markets.
As it relates to fixed income, investors are bracing for a move higher in rates in 2017 after a difficult back half of 2016 for bond investors. When viewing a longer term chart of US Treasury yields, the pattern of lower highs and lower lows remains. This may be viewed saving grace for bond investors as rates technically still remain in 30 year + downtrend. Will 2017 mark the year the bond bull market ends? Time will tell.
By the end of 1st quarter we may have a much better idea of what policy promises may or may not come to fruition and in what form from the new administration. Overseas a number of important elections will take place in Europe in 2017 as the rise of populism takes shape. Bottom line is that 2017 may be a year of major global change and our commitment to clients is to keep an open mind, remove potential biases, but always maintain our mandate of managing risk for client portfolios.

As always, we welcome any thoughts, questions or general conversations. We continue to strive and work hard every day to try and make our wealth management experience unique and customized to each client.

Disclosure: This commentary on this website reflects the personal opinions, viewpoints and analyses of the BluePrint Wealth Alliance, LLC employees providing such comments, and should not be regarded as a description of advisory services provided by BluePrint Wealth Alliance, LLC or performance returns of any BluePrint Wealth Alliance, LLC Investments client. The views reflected in the commentary are subject to change at any time without notice. Nothing on this website constitutes investment advice, performance data or any recommendation that any particular security, portfolio of securities, transaction or investment strategy is suitable for any specific person. Any mention of a particular security and related performance data is not a recommendation to buy or sell that security. BluePrint Wealth Alliance, LLC manages its clients’ accounts using a variety of investment techniques and strategies, which are not necessarily discussed in the commentary. Investments in securities involve the risk of loss. Past performance is no guarantee of future results.