My friends at Riskalyze have offered me the opportunity to see which stocks and funds advisors all over the country are adding to their clients’ accounts and which ones they’ve been selling. Each week I’ll present you with the top three buys and sells and we’ll track how this progresses while trying to figure out what it says about the professional mindset.
This data has been aggregated from across the client accounts of the thousands of advisors who use the software. Most of it comes directly through the third-party custodians where advisors’ assets are held. I hope we can uncover interesting trends for you each week…
Week of October 26th – October 31st 2014:
Winners = top investments purchased by advisors for client portfolios that week
Losers = investments that advisors sold out of in client portfolios that week
Winners (advisor flows TO these investments increased substantially):
First Eagle Global (SGENX)
Losers (advisor flows FROM these investments increased substantially):
Pimco Total Return
The selling of Pimco’s Total Return continued this week across financial advisor-managed portfolios. It’s notable to see MLPs being dumped, especially by Oppenheimer registered reps as the Oppenheimer SteelPath MLP Income A (MLPDX) hits the most sold list.
On the other side, Advisors bought the dip in gold, specifically GLD, America’s favorite paper-gold ETF. I would posit that this was a rebalance trade by the multitude of advisors who keep a symbolic 5 percent slug of their portfolios in gold or precious metals – to show their bearish clients that “they get it”. Not that having 5% of anything is ever going to really hedge anyone, but that’s another story (I wrote about symbolic gold slots in portfolios here).
Advisors also came out and bought the First Eagle Global fund – which is basically like a value-investing vehicle for the risk-averse and for gold bugs who are forced to own equities. First Eagle normally keeps a 10 percent weighting to gold and gold miner equities. They also can hold a lot of cash in the fund when markets become so pricey that their bottom-up analysis yields fewer buy candidates.
The raising of cash also continued as money market funds became the third item on the most bought list.
A word about Riskalyze:
In my practice, we use Riskalyze software tools to help assess clients’ true risk tolerance and to test portfolio configurations that match up accordingly. It’s changed our practice for the better, as I explain here.