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Investing Specialists

Weekly Wrap: What You Should Know About Cryptocurrency Regulation, Diversification, and Corporate Tax Rates

We recap the week on Morningstar.com and note the most popular stocks, funds, and exchange-traded funds.

Editor's note: Read the latest on how the coronavirus is rattling the markets and what investors can do to navigate it.

Delivering a commencement address can't be easy. It requires at least a few good jokes and, of course, some memorable anecdotes. Great speeches also impart wisdom, simultaneously applauding new graduates on their accomplishments and encouraging them to embrace their uniqueness, find joy, work hard, and make a difference. That's a tall order.

The order is even taller this year. After all, the class of 2021 is likely burned out from Zoom meetings and bummed out about lost internship opportunities. For some lucky graduates, their colleges are holding modified in-person graduation ceremonies. For others, graduation is yet another virtual event.

How can we, as investors, impart wisdom to the unique class of 2021?

First, we can point out to new graduates that they have something terribly valuable from a saving and investing perspective, something that many of us have so much less of: time. By saving and investing as early as possible, new grads can turn their money into what my colleague Karen Wallace has called "superdollars"--dollars that hold tremendous growth potential because they have three or four decades of compounding ahead of them. 

Of course, those with sizable student loan debt and low-paying first jobs may not have extra dollars to spare. But we should nonetheless encourage them to find a few bucks to save, particularly if they have access to an employer-sponsored retirement plan that matches the contributions its employees make. We need to tell them that if they save early and often, the $1 million 401(k) plan balance that seems out of reach today can become a reality.

Then let's get the new graduates in our lives on the right money path with a meaningful financial gift. Maybe we give cash that we earmark for their emergency funds. Or we cover a student loan payment. Or perhaps we gift stocks from our portfolios. And along with the financial gift, let's include a favorite investment book that we learned from or turn the grad on to a money-related podcast that we enjoy--or share a link to Morningstar's Money Guide for New Graduates

Lastly, let's remind the new grads that they're resilient. That quality will serve them well in investing--and in life.

--Susan Dziubinski

Editor's Picks

Is the Retirement-Income Party Finally Over?
Today's retirees will have difficulty continuing a long and happy trend.

Seeking Diversification? Forget REITs and Consider Utilities
Few U.S. equity sectors came through in 2020's crash, but utilities diversification benefits are on the rise.

What Corporate Tax Rate Hikes Could Mean for Stocks
We expect a mid-single-digit impact to average U.S. equity valuations.

Understanding Regulation on Cryptocurrency
Contrary to popular belief, there is more substantial regulatory clarity for cryptoassets than many advisors think.

Pros and Cons of Donor-Advised Funds
Donors benefit from an immediate tax deduction, tax-free growth, and investment flexibility.

What to Know as Squarespace Goes Public
The established website builder sees growth opportunities but faces stiff competition.

Portfolio Planning and Personal Finance With Christine Benz

3 Tricky Decisions for Every Retirement Plan
Not even experts agree about the 'right' withdrawal rate, long-term-care insurance, and annuities.

What's the Best Way to Give a Financial Gift?
Here are some tips if you're thinking about giving appreciated stock, a Roth IRA, or good old-fashioned cash.

Sorry, You Probably Don't Have a Portfolio Emergency
What ails many portfolios--and what can fix them--is actually pretty mundane.

Financial Planning, Investing, and Inflation
With some planning and awareness, you can steer your retirement fund safely through times of inflation.

Mutual Funds and Exchange-Traded Funds

3 Promising ESG Bond Funds
These sustainable fixed-income funds have recently earned our confidence.

Not All Value Strategies Are Created Equal
Know what you own.

Value Funds Strike Back
Rebounds can be just as fast and surprising as sell-offs.

Bank-Loan Funds Are Back: Here Are 2 to Consider
It's a new day for these unique vehicles, which are seeing inflows.

Stocks

Networking Vendors Aren't Going Away
We think the cloud holds substantial--and underestimated--opportunity for some of these companies.

Should You Diversify by Stock Size and Style?
New research backs up the importance of diversifying your stock holdings.

6 Charts on the Stock Market Rotation
Investors are shifting out of pricey sectors and styles and into areas of the market that have been less richly valued.

The Winners of the New Definition of Infrastructure
Depending on which broader infrastructure projects take shape, numerous companies could see increased demand.

Are Vaccinemakers Attractive Today?
Here are a few drugmakers we like that are undervalued.

2 Warren Buffett Stocks to Buy
These undervalued stocks are among the holdings in Berkshire Hathaway today.

Earnings Results Rally Fair Values in These Sectors
Three sectors saw the most fair value increases after the first-quarter earnings season.

Stock Analyst Updates

Berkshire Once Again a Net Seller of Equities in Q1
The firm raised an estimated $7.7 billion from its sales of shares.

Walmart Starts Off Fiscal 2022 Better Than We Expected
We suggest investors await a more attractive entry point.

Macy's Achieves Unexpected Profit
We expect to raise our fair value estimate for the no-moat company.

Momentum Across Home Improvement Bolsters Home Depot
We're increasing our fair value estimate after the firm's strong sales growth.

Target Sees Strong Q1 Despite Difficult Comparisons
We're likely to increase the company's fair value estimate.

Cisco’s Q3 Indicates Recovery; FVE Up to $50
We are raising our fair value estimate for narrow-moat Cisco to $50 per share from $48, and view shares as fairly valued.

Rekenthaler Report

The Latest Attack on Target-Date Funds
Three professors claim that such funds dupe inattentive shareholders.

Advisor Insights

So Your Company Is Going Public. Now What?
The various methods of going public can have different implications for employee shareholders. Here's the rundown.

The Long View Podcast

Teresa Ghilarducci: To Fix Retirement, Expand Social Security
The labor economist and author discusses the country's retirement crisis, guaranteed retirement accounts, and what behavioral finance gets wrong.

Commentary

The Benefits of Increased Portfolio Customization
CEO and portfolio manager Patrick O'Shaughnessy talks ESG, custom indexing, and factor investing.

U.S. Equity Fund Flows Cool Down in April
Investors favor international equities and fixed income.

Most Requested Stock Quotes

Apple
AT&T Inc
Alibaba Group
Microsoft
Amazon.com

Most Requested Fund Quotes

Vanguard 500 Index
Fidelity 500 Index
Vanguard Dividend Growth
Vanguard Total Stock Market Index
Dodge & Cox

Most Requested ETF Quotes

Vanguard S&P 500 ETF
ARK Innovation ETF
Schwab US Dividend Equity ETF
SPDR S&P 500 ETF Trust
Vanguard Total Stock Market ETF

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