kevin m. wilson, phd chairman/ceo
DESCRIPTION
Bi-Monthly Market Review “Consensus and Contrarian Bets” (Knowing When To Bet With Or Against The Herd) May 15 th , 2014. Kevin M. Wilson, PhD Chairman/CEO. Ted A. Pavlovich, WMS President/Wealth Mgmt. Advisor. Office: 218-464-4399 Toll Free: 877-327-5062 Fax: 218-464-4397 - PowerPoint PPT PresentationTRANSCRIPT
![Page 1: Kevin M. Wilson, PhD Chairman/CEO](https://reader035.vdocuments.net/reader035/viewer/2022062315/56815a7a550346895dc7e59a/html5/thumbnails/1.jpg)
Kevin M. Wilson, PhD
Chairman/CEO
1405 Medical Arts Building324 W. Superior StreetDuluth, MN 55802
Office: 218-464-4399 Toll Free: 877-327-5062
Fax: 218-464-4397Email: [email protected]
www.bluewatercapitaladvisors.com
Bi-Monthly Market Review
“Consensus and Contrarian Bets” (Knowing When To Bet With Or Against The Herd)
May 15th, 2014
1
Ted A. Pavlovich, WMS
President/Wealth Mgmt.
Advisor
1
![Page 2: Kevin M. Wilson, PhD Chairman/CEO](https://reader035.vdocuments.net/reader035/viewer/2022062315/56815a7a550346895dc7e59a/html5/thumbnails/2.jpg)
INTRODUCTION
TED A. PAVLOVICH
2
![Page 3: Kevin M. Wilson, PhD Chairman/CEO](https://reader035.vdocuments.net/reader035/viewer/2022062315/56815a7a550346895dc7e59a/html5/thumbnails/3.jpg)
PIVOTAL INVESTOR CHOICES THIS YEAR
KEVIN M. WILSON
3
![Page 4: Kevin M. Wilson, PhD Chairman/CEO](https://reader035.vdocuments.net/reader035/viewer/2022062315/56815a7a550346895dc7e59a/html5/thumbnails/4.jpg)
4
Pivotal Choices (Consensus vs. Contrarian):1) Inflation/Interest Rates (Contrarian)2) Global Growth Cycle (Consensus)3) Market Valuations/Risk (Contrarian)4) Investment Themes (Both)
What Happens Next?
![Page 5: Kevin M. Wilson, PhD Chairman/CEO](https://reader035.vdocuments.net/reader035/viewer/2022062315/56815a7a550346895dc7e59a/html5/thumbnails/5.jpg)
Inflation Low To Falling, Except for Japan
5
![Page 6: Kevin M. Wilson, PhD Chairman/CEO](https://reader035.vdocuments.net/reader035/viewer/2022062315/56815a7a550346895dc7e59a/html5/thumbnails/6.jpg)
6
Fed Policy Changing WithTaper; Inflation Outlook Uncertain; But Debt Has Not Fallen, Only Transferred
![Page 7: Kevin M. Wilson, PhD Chairman/CEO](https://reader035.vdocuments.net/reader035/viewer/2022062315/56815a7a550346895dc7e59a/html5/thumbnails/7.jpg)
7
Consensus: Global Growth Is Stable & Modestly Increasing
![Page 8: Kevin M. Wilson, PhD Chairman/CEO](https://reader035.vdocuments.net/reader035/viewer/2022062315/56815a7a550346895dc7e59a/html5/thumbnails/8.jpg)
8
2013’s Huge Return Driven By Higher Prices, Not Growth
![Page 9: Kevin M. Wilson, PhD Chairman/CEO](https://reader035.vdocuments.net/reader035/viewer/2022062315/56815a7a550346895dc7e59a/html5/thumbnails/9.jpg)
9
Price/GDP Very High;Expected Returns Can Go Higher Only IfThere’s A Correction
![Page 10: Kevin M. Wilson, PhD Chairman/CEO](https://reader035.vdocuments.net/reader035/viewer/2022062315/56815a7a550346895dc7e59a/html5/thumbnails/10.jpg)
10
Contrarian Bet: Low Yields For Long Treasuries
![Page 11: Kevin M. Wilson, PhD Chairman/CEO](https://reader035.vdocuments.net/reader035/viewer/2022062315/56815a7a550346895dc7e59a/html5/thumbnails/11.jpg)
11
Four Consensus Themes: El Nino, Energy, Food, Climate
![Page 12: Kevin M. Wilson, PhD Chairman/CEO](https://reader035.vdocuments.net/reader035/viewer/2022062315/56815a7a550346895dc7e59a/html5/thumbnails/12.jpg)
ROTATION TO VALUE PLAYS WILL PERSIST
KEVIN M. WILSON
12
Value Stocks Outperform
![Page 13: Kevin M. Wilson, PhD Chairman/CEO](https://reader035.vdocuments.net/reader035/viewer/2022062315/56815a7a550346895dc7e59a/html5/thumbnails/13.jpg)
Most Stocks Are Priced Expensively
Value Measures:P/BP/EEV/EBITDAP/SP/CF
13
![Page 14: Kevin M. Wilson, PhD Chairman/CEO](https://reader035.vdocuments.net/reader035/viewer/2022062315/56815a7a550346895dc7e59a/html5/thumbnails/14.jpg)
14
Contrarian Bet:Value Investing WillTend To OutperformGiven High Avg. Prices
Value P/E’s Can Go Up
Dividends Can Help
If You Start With Cheap Prices, You Make More
![Page 15: Kevin M. Wilson, PhD Chairman/CEO](https://reader035.vdocuments.net/reader035/viewer/2022062315/56815a7a550346895dc7e59a/html5/thumbnails/15.jpg)
The High Flyers Fell First,But The Avg. Stock Is AlreadyIn A Correction, Further Favoring Value Stocks
5/09/2014
15
![Page 16: Kevin M. Wilson, PhD Chairman/CEO](https://reader035.vdocuments.net/reader035/viewer/2022062315/56815a7a550346895dc7e59a/html5/thumbnails/16.jpg)
Some Examples of Potential Contrarian Value Plays
16
![Page 17: Kevin M. Wilson, PhD Chairman/CEO](https://reader035.vdocuments.net/reader035/viewer/2022062315/56815a7a550346895dc7e59a/html5/thumbnails/17.jpg)
EL NINO PLAYS WILL RETURN
KEVIN M. WILSON
17
Warm Water in Equatorial Pacific Changes Precipitation Pattern
![Page 18: Kevin M. Wilson, PhD Chairman/CEO](https://reader035.vdocuments.net/reader035/viewer/2022062315/56815a7a550346895dc7e59a/html5/thumbnails/18.jpg)
18
El Nino Switches Off Upwelling In Western South America
Peruvian Fisheries Severely Impacted
![Page 19: Kevin M. Wilson, PhD Chairman/CEO](https://reader035.vdocuments.net/reader035/viewer/2022062315/56815a7a550346895dc7e59a/html5/thumbnails/19.jpg)
El Nino’s Changes In Precipitation Patterns Affect Food Production,Coal Mining, Copper Mining
19
![Page 20: Kevin M. Wilson, PhD Chairman/CEO](https://reader035.vdocuments.net/reader035/viewer/2022062315/56815a7a550346895dc7e59a/html5/thumbnails/20.jpg)
20
But El Nino May FinallyEnd The Drought In The Western USA
![Page 21: Kevin M. Wilson, PhD Chairman/CEO](https://reader035.vdocuments.net/reader035/viewer/2022062315/56815a7a550346895dc7e59a/html5/thumbnails/21.jpg)
ELECTION CYCLE WILL PROVIDE A Q4/2014 LIFT
TED A. PAVLOVICH
21
![Page 22: Kevin M. Wilson, PhD Chairman/CEO](https://reader035.vdocuments.net/reader035/viewer/2022062315/56815a7a550346895dc7e59a/html5/thumbnails/22.jpg)
22
The Four-Year USA Election Cycle Can Strongly Affect Markets
![Page 23: Kevin M. Wilson, PhD Chairman/CEO](https://reader035.vdocuments.net/reader035/viewer/2022062315/56815a7a550346895dc7e59a/html5/thumbnails/23.jpg)
23
Consensus: We Are Tracking The Avg. Midterm Election Year Pattern, But With More Volatility Than Normally Experienced
?
![Page 24: Kevin M. Wilson, PhD Chairman/CEO](https://reader035.vdocuments.net/reader035/viewer/2022062315/56815a7a550346895dc7e59a/html5/thumbnails/24.jpg)
SUMMARY
24
KEVIN M. WILSON
(Both Consensus and Contrarian Plays Will Work This Year)
1. Inflation/Interest Rates Will Strongly Influence Returns2. Value Plays Will Outperform This Year3. Energy, Food, and Climate Plays Provide Opportunities4. The USA Election Cycle Will Drive Returns After The Correction5. We Are Excited About The Chance To Make Money Later This Year
![Page 25: Kevin M. Wilson, PhD Chairman/CEO](https://reader035.vdocuments.net/reader035/viewer/2022062315/56815a7a550346895dc7e59a/html5/thumbnails/25.jpg)
Q & A
25
KEVIN M. WILSONTED A. PAVLOVICH
![Page 26: Kevin M. Wilson, PhD Chairman/CEO](https://reader035.vdocuments.net/reader035/viewer/2022062315/56815a7a550346895dc7e59a/html5/thumbnails/26.jpg)
This report is provided for informational purposes only and does not constitute an offer or solicitation to purchase or sell any security or commodity and is not intended to provide specific advice or recommendations for any individual. To determine which investment(s) may be appropriate for you, consult your financial advisor prior to investing. Any opinions expressed herein are subject to change at any time without notice. Information has been obtained from sources believed to be reliable, for its accuracy and interpretation are not guaranteed.
Investing in securities involves risk, including possible loss of principal. Past performance should not be taken as an indication of guarantee of future performance and no representation, express or implied, is made regarding future performance.
The firm does not provide tax advice; clients should contact their attorney, accountant, or other tax adviser regarding tax matters.
“BWCA is a state registered investment adviser in all states in which it is required to be registered. All Blue Water Capital Advisors’ customer assets are held in the customer name with Fidelity Institutional Services, clearing through National Financial Services (NFS), Member SIPC, a Fidelity Investments Company as Qualified Custodian.”
Disclaimer
2626