Market Snapshot
Welcome to the first quarterly issue of our Investment Committee Commentary. Each quarter, the Commentary includes a Market Snapshot which allows you to quickly see how various asset classes have been performing, a narrative review of the most recent period of market performance, as well as more in depth summaries of the Committee’s recent research and decisions.
We also wanted to take this opportunity to let you know that Abacus has recently taken on two experienced financial advisors as Partners in the firm. We’ve been in contact with Dave DeWolf and Darius Gagne over the past several years at industry conferences and study groups, and have always been impressed. After collaborating on a handful of clients, we all decided joining forces would be better for everyone concerned, and we signed merger documents in January. Dave is a CFP and CPA, having had substantial experience in accounting prior to becoming a financial advisor, and Darius earned a PhD in quantum physics prior to getting his CFP and CFA designations and working at two of the largest Wall Street firms in investment research. Both Dave & Darius have MBA’s from UCLA. Because of their educational and real life experience with investment management, both were voted onto the Abacus Investment Committee for 2012. Please join us in welcoming them to the Abacus family.
Brent and Spencer
IN THIS ISSUE
Los Angeles | San Francisco Bay Area | Philadelphia | New York City
www.abacuswealth.com (888) 422-2287
Issue I - February 2012
The 2012 Abacus Investment Committee
Tom O’Connor
CFA, CFP, MBA
Brent Kessel
CFP
Darius Gagne
PhD, CFA, CFP, MBA
Dave DeWolf
CFP, CPA, MBA
2011 Market Review
Equity investors around the world had a disappointing year in 2011 as thirty-seven out of forty-five markets posted negative returns. The US did well on a relative basis and was the only major market to achieve a positive total return, although the margin of victory was slim. Total return for the S&P 500 Index was 2%, and the positive result was a function of reinvested dividends—the index itself finished the year slightly below where it started. read more
Note from our CIO: Expected Investment Returns Going Forward
In November 2011 our Investment Committee gathered for a two-day off-site retreat, specifically for “big-picture” discussion, and to review the specific investment vehicles we use in every asset class we recommend to clients. We also considered whether to include new asset classes. We surveyed a vast amount of academic literature in advance, and invited four guest speakers on specific topics. The 29 pages of written minutes generated many actions we’re taking now, actions we may pursue as we investigate the practicalities, and several other areas for further investigation. We devoted considerable attention to coming up with long term expectations for future investment rates of return. read more
Investment Committee Decisions - 4th Quarter 2011
- Substitute O’Shaughnessy Capital Management’s All-Cap Core fund for DFA’s US Large and Marketwide Value funds, making it roughly equal to 25% of the US stock allocation for most clients.
- Trigger a rebalance whenever fixed income (bonds) varies from its target by 10% or more.
- Substitute Vanguard REIT Index ETF (ticker symbol VNQ) for DFA's Domestic Real Estate Securities Portfolio (ticker symbol DFREX)
Molson Coors: “Green beer anyone?”
Molson Coors is a holding of the DFA US Sustainability Core fund, which is owned by a majority of Abacus clients. Molson Coors made significant improvements to its environmental footprint, taking on its most material impacts and developing innovative solutions. Consequently, its score has increased notably. Molson Coors has improved to become the top-scoring brewer, 3rd among all beverage makers, and in the top quintile for all consumer staples in our environmental rankings. read more
eRecycling Corps Secures $35 million Funding
eRecyclingCorps is a partner to global wireless carriers and retailers in the management of wireless e-waste as an asset. eRecyclingCorps raised $35 million in a fundraising round led by Kleiner Perkins Caufield & Byers. The investment marks yet another milestone for eRecyclingCorps (ERC), which already counts Sprint and Verizon among the many customers of its novel “instant in-store credit” offering. Seeing tremendous potential in a market where more than 130 million mobile devices are retired each year in the United States alone, ERC launched in 2009 with original investments from OpenAir Equity Partners and SJF Ventures to help carriers and subscribers recapture a growing portion of the residual value of wireless devices no longer used by subscribers. read more
Abacus Wealth Partners, LLC (“Abacus”) is an SEC registered investment adviser with its principal place of business in the State of California. Abacus may only transact business in those states in which it is notice filed, or qualifies for an exemption or exclusion from notice filing requirements. This brochure is limited to the dissemination of general information pertaining to its investment advisory services. Any subsequent, direct communication by Abacus with a prospective client shall be conducted by a representative that is either registered or qualifies for an exemption or exclusion from registration in the state where the prospective client resides. For information pertaining to the registration status of Abacus, please contact us or refer to the Investment Adviser Public Disclosure web site (www.adviserinfo.sec.gov).
This newsletter contains general information that is not suitable for everyone. The information contained herein should not be construed as personalized investment advice. Information was based on sources we deem to be reliable, but we make no representations as to its accuracy. Past performance is no guarantee of future results. There is no guarantee that the views and opinions expressed in this newsletter will come to pass. Investing in the stock market involves gains and losses and may not be suitable for all investors. Information presented herein is subject to change without notice and should not be considered as a solicitation to buy or sell any security. Information related to the firm’s performance is based on pure model portfolios only and is net of fees. Certain clients may have holdings that deviate from the model and as such individual client performance may be different than the results presented herein.
For additional information about Abacus, including fees and services, send for our disclosure brochure as set forth on Form ADV from us using the contact information herein. Please read the disclosure brochure carefully before you invest or send money.
