S&P 500 Welcomes New Members: Apollo Global Management and Workday
On December 23rd, the S&P 500 index will welcome two new companies: Apollo Global Management and Workday. This announcement sparked significant interest, with both companies’ stocks experiencing notable jumps in after-hours trading.
What is Apollo Global Management? Founded in 1990, Apollo is an alternative asset management firm specializing in private equity, credit, and real assets investments. It has over $500 billion in assets under management.
Workday provides enterprise/business cloud applications for finance and human resources by offering a suite of software solutions that help organizations manage their workforce, financial operations, and planning processes.
Inclusion in the S&P 500 increases these companies’ visibility among investors but also typically leads to increased demand for their stocks. This is primarily due to the large number of index funds and ETFs that track the S&P 500, which must now include these companies in their portfolios.
Sources: Apollo Global Management, Workday Stocks Jump on S&P 500 Inclusion
Retirement Millionaires are Everywhere
A strong stock market and continued employee contributions and employer matches contributed to a 10% increase in 401(k) millionaires at Fidelity this past quarter. Fidelity reports that there are now 544,000 (up from 497,000) million-dollar 401(k) retirement accounts.
In addition, the number of IRAs with a million increased by about 5% to 418,000. The average IRA reached a level of $129,000. There are almost one million accounts with a million dollars. Given the continued positive market performance this quarter, more 401(k) millionaires may be created.
Active, Passive, or Both?
In a portfolio, a combination of active and passive investments may actually complement each other. Both actively and passively managed funds offer diversified investments that use a benchmark index to evaluate performance; however, they differ when it comes to their strategy.
Passively managed funds seek to replicate the performance of a benchmark index, like the S&P 500. The S&P 500 tracks 500 of the largest companies listed on the US stock market. These companies’ stock prices quickly adjust to new public information.
On the other hand, actively managed funds tend to be more expensive than passive ones because they attempt to outperform the benchmark index. These funds use their investment team’s expertise to find mispriced securities and market segments. Given that some market segments are more efficient than others, a combination of active and passive managed funds allows investors to track efficient markets while capturing opportunities in less efficient ones.
Actively managed funds are usually less transparent than passive ones because they do not frequently disclose all their trading activity. The investment managers’ opacity helps protect their investment strategies from being replicated by competitors. In contrast, passively managed funds have transparent investment strategies that are publicly available and much easier to track than active ones. Ultimately, the choice between active and passive funds requires thoughtful analysis, making it essential to understand their different investment strategies to make well-informed investment decisions.
Provise Recognized Once Again
Financial Planning Magazine accepted applications from “any RIA registered with the SEC – for-profit or nonprofit – that met three conditions: Each firm must have at least ten employees in the United States, must have a facility within the country, and must have been in business for at least one year.” They surveyed leadership, culture, pay and benefits, training, work environment, engagement, communications, and other factors. Further, they look at workplace policies, practices, benefit programs, philosophy, systems and demographics.
The magazine compiled a list of 52 outstanding RIAs nationwide with six firms coming from Florida and three of those were in the Tampa Bay Area. At the top of those six firms, coming in at #11 nationally, was ProVise. We cannot thank our team enough for helping us create an environment where we work hard for our clients, respect each other, and have fun. CONGRATULATIONS AND WAY TO GO TEAM!!!
New “Up Your Assets™” Podcast
In this UP YOUR ASSETS™ podcast, Ray interviews Christine Simone, Founder of Caribou, in an episode entitled “It Is All About Health Insurance.” Health insurance is one of the most expensive things we buy, especially in retirement. When you are trying to decide about Medicare and Medicare supplement, considering a Medicare Advantage plan as an alternative, or buying insurance in the marketplace through Obamacare, the matrix and information is overwhelming. Christine talks about how her software works its magic to help you find your best choice. Sit back and watch this entertaining and informative video. Just click on this link: It’s All About Health Insurance
Holiday Greetings
We wish you a Happy and Healthy Holiday Season! Our next edition of the ProVise Perspective$ will appear in your inbox or mailbox in the new year.
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