Tax Planning

Franklin Small Cap Value Fund Portfolio Manager Steve Raineri discusses why he thinks the near-record underperformance of higher-quality, profitable small-capitalization (small-cap) value stocks relative to lower-quality, unprofitable companies could present a compelling opportunity for longer-term investors as the US economy continues to recover from the COVID-19 pandemic.

A large fiscal package geared toward pandemic relief will likely boost U.S. growth even further in 2021, but long-term inflationary risks are still balanced.

Looking at the latest economic data reveals V-shaped recoveries in many goods-based indicators; while services has more catch-up to do.

A look at two ingredients that make a meaningful impact on performance in the mid cap space.

Political change, continued fiscal support will drive municipal markets in 2021, although outcomes are likely to vary.

Weighing the costs of global vaccine access, minimum wage and the energy rally.

In late 2020, a new kid emerged on the bargain-of-the-decade block. UK stocks, and notably UK value, reached very cheap levels relative to value stocks in other developed economies. Today, UK value remains at remarkably low valuations relative to most of its fundamentals.

A strong economic rebound is expected towards the middle of the year, followed by a return to more normal growth in 2022.

Apart from some high-profile downgrades, the muni credit markets finished 2020 buoyed by breakthrough vaccines and signs that state and local tax collections were better than anticipated.

Although US technology equities tend to dominate the conversation about technology investing, Franklin Equity Group’s John Remmert and Don Huber believe there are many innovative international technology companies that tend to get overlooked.

A brief monthly update on what's happening in the municipal bond market.

• Tax-exempt municipal bonds generated solid performance in January, with high yield munis gaining more than 2% on the month.
• Municipal yields rose early in the month on expectations for higher rates and additional fiscal stimulus.
• Although issuance was relatively light in January, the municipal market experienced strong demand, with four consecutive weeks of fund inflows.

Ever since the stock market bottomed in 2009 during the financial crisis, people have been coming up with reasons why the bull market was about to end. We heard every reason – Brexit, the end of Quantitative Easing, too much debt, COVID, etc. – and while we understood each may be a cause for consternation, we focused on valuations, which suggested the bull market would continue. Over time, math wins.

The object of the game was to get to the finish line first and then become the leader the next round. The stock market has its own game of “Simon says” and that is in the mall property world.

Are proposed fiscal policies and student debt forgiveness too much of a good thing?

Our Chief Market Strategist Stephen Dover believes cryptocurrency (crypto) is evolving into its next cycle of innovation. As an integral foundation for an alternative financial and internet ecosystem, crypto’s disruptions, opportunities, risks, and long-term implications are worth watching.

If, however, the pandemic continues into summer, it will mean the Gripping Hand is still squeezing us. Employment won’t recover and more small businesses will fail. This relief package, as large as it is, may prove necessary and maybe even too small.

Hope is high that economic growth will accelerate as more people are vaccinated against COVID-19, but so far economic data has been lackluster. Meanwhile, bond investors are expecting inflation despite signs that the economic recovery’s momentum may be stalling. Why does everything seem so disconnected?

Stephen Dover, our Chief Market Strategist and Head of Franklin Templeton Investment Institute, shares four investment themes he’s thinking about as the world recovers from the COVID-19 pandemic.

On October 2, 2019 brokerage firm Charles Schwab announced they were no longer going to charge commissions on stock and ETF trades. Before the day closed E-Trade and TD Ameritrade followed suit. And just like that, commissions were dead.

This is a new type of exchange-traded ETF that is built differently from a traditional ETF.

Tesla announced in a public filing Monday that it bought $1.5 billion worth of Bitcoin as part of a corporate policy that allows the electric vehicle (EV) maker to invest in “alternative reserve assets,” including not just cryptocurrencies but also gold bullion and gold ETFs.

Our Fixed Income CIO Sonal Desai shares her investment views and strategies for the post-pandemic recovery. She explains why inflation looks likely to gain steam, and how the balance of fundamentals and valuations become especially crucial today when looking for attractive returns in fixed income.

I don’t say this often, but Fed Chairman Jerome Powell is wrong. Regular readers of our investor letters and other publications will recall that we regularly cite Chairman Powell as doing the best he can with the levers he has while arguing correctly for others to do their part.

As quickly as it soared to the moon, GameStop came back down to earth; but the lessons learned are key to turning day trading speculators into longer-term investors.

Rick Rieder and team think that today’s potent policy cocktail holds important implications for the path of economic growth, markets and the value of a dollar.

The Northern Trust Economics team shares its outlook for the U.S. economy.

Inflation is not dead. It is not gone. It has not been tamed. We know it seems like it, especially after the past few decades which generated in many an "inflation-complacency" that feels justified. After all, following the 2008 Financial Panic, many predicted Quantitative Easing would cause hyper-inflation.

At some point, interest rates will move higher. Advisors must understand the inherent risks, and proactively evaluate alternatives for their fixed income portfolios to manage through successfully.

Any surge in inflation will likely not last for long, but Italy's economic troubles and the shift in rental markets may endure.

The GameStop/Reddit wolfpack plan of herding shorts into a self-destructive, short-covering frenzy seems to be failing for several primary reasons.

It’s hoped that an extra $1,400 in the pockets of everyday Americans may help support lagging U.S. consumption. We believe the stimulus, along with improved vaccine roll out, may also help support commercial air travel.

Today I want to discuss an arcane-sounding but incredibly important term you need to know: Yield Curve Control. Several central banks are already using it and I see a strong possibility the Fed will join them. But first we must again consider the Gripping Hand.

With the previous week’s short-squeeze headlines behind us, investors remained optimistic about a fiscal support package, which passed the Senate by a vote of 51-50, with Vice President Harris breaking the tie.

Effective vaccines, historic fiscal stimulus, Democratic Party control of the legislature, even more stimulus, reopening economies, 6% U.S. real GDP (gross domestic product) growth, 25% U.S. EPS (earnings per share) growth, and maybe even an infrastructure plan sprinkled on top.

The COVID-19 crisis opened up cracks in the muni market, but we don’t expect those cracks to alter the reality that municipal bonds can be a relatively conservative investment option. Many municipalities are under stress, but that’s not a reason to avoid munis, in our view.

Commercial aviation still has some challenging times ahead of it, but I believe the worst is behind us, meaning now may be an opportune time to get exposure.

We’ll touch on several bases today. We start with the latest news from the Commerce Department which just released its initial estimate of 4Q economic growth (or lack thereof). 2020 goes down as the worst economic year since the end of World War II.

When investors talk about “the stock market” they are most often referring to an index that tracks stocks only in their home country. This “home bias” is evident when it comes to the make-up of investors’ stock portfolios. Investors around the world tend to hold mostly domestic stocks.

Internet message boards are lighting up and certain stocks have seen some unusually dramatic price moves. David Mann, our Head of Global Exchange Traded Funds (ETFs) Capital Markets, ponders whether ETFs could be subject to similar volatility.

The UK-EU trade agreement entered into just before Christmas is a 1,200-page monster which contains far more cons than pros for the British economy despite Boris Johnson doing his very best to convince the British public of the opposite. In this month’s Absolute Return Letter, you can see why.

Emerging markets seek a sustainable solution to debts, and the Fed takes a step toward sustainability.

Those of you with kids and grandkids may at some point have stepped inside a GameStop. If so, you might be familiar with the video game retailer’s tagline: “Power to the players.”

Changes in government inevitably bring new priorities and policies, one being the area of taxes. Fiduciary Trust International Managing Director Craig Richards examines possible tax implications for individuals under President Joe Biden’s new administration.

The COVID-19 pandemic has expanded the universe of companies in financial distress, creating a buyer’s market for distressed debt funds.

A majority of the Senate (including two Democrats) has agreed to forego efforts to eliminate the filibuster during the Congressional term ending December 2022.

Read our year-ahead report to learn how this shift could lead to investment opportunities in 2021 and to understand RBA's positioning.

There have been a small number of consistent alpha-creating axioms in the U.S. stock market over time. Value beat growth over long time frames, tech stocks hit bottom in the summer and crowded trades separate you from your money, to name a few.