Prophecy Impact Investments Rebrands as Falcons Rock Impact Investments
In order to improve brand familiarity and better convey the environmental benefits, our sister company has been renamed. Visit the Falcons Rock Impact website to learn more about responsible investing and to start exploring your porfolio today.
Visit website.

 

What Plan Sponsors Need to Know About SRI Investing
This article from the International Foundation of Employee Benefit Plans defines the basics of SRI and highlights how retirement plan ficuciaries can implement the concept. Greg Wait of Falcons Rock gives offers his take on why it makes business sense.
Read August article.

 

Investing with Environmental & Social Impact.
In the cover story of their 2018 Guide to Wealth Management, the Milwaukee Business Journal interviewed Greg Wait of Falcons Rock to discuss the new definition of SRI, Sustainabile Responsible Impact investing, and the incresing number of clients making it a priority.
Read May article.

 

Companies’ Social Impact Increasingly Scrutinized by Investors.
Greg Wait of Falcons Rock gave his insight into the recent rise and benefits of socially responsible investing (SRI) for this BizTimes article from February 5th.
Read February article.

 

History Has Steered Folks to Environmental, Social and Governance Investing.
In this Milwaukee Journal Sentinel article from July 15th, Tom Saler explores socially responsible investing (SRI) and breaks down some recent high-profile examples.
Read July article.

 

New Firm Targets Socially Responsible Investors.
In this article from January 9th, Milwaukee Journal Sentinel reporter Kathleen Gallagher explores Greg Wait's launch of a new company that combines socially responsible investing and online investment advice.
Read January article.

 

Investment Trends, with insights by Greg Wait. In the Milwaukee Journal Sentinel's October 17th article, Kathleen Gallagher and Greg Wait discuss the recent rise of environmental, social and governance, or ESG investing. Greg provides insight into how reduced risk and improved returns are causing money managers to include ESG investing in their portfolios. Read October article.

 

Responsible Investing: Creating Financial and Non-Financial Value by Greg Wait. Do investors sacrifice returns in pursuit of their goal of advocating for a better world in which to live?
Learn more.

 

Ten-Year History of Investment Manager Performance by Greg Wait. As part of our process, we have conducted investment manager research and due diligence resulting in manager or fund recommendations to our clients. Here are our findings.

 

The month of September, 2013 marked the 10-year anniversary of Falcons Rock serving our clients and building relationships. We are grateful for all the years of friendship, loyalty, and support, and look forward to our next decade!

 

Investment Trends, with insights by Greg Wait. In the Milwaukee Journal Sentinel's July 20th article, Kathleen Gallagher and Greg Wait discuss the rising U.S. Treasury rates and using duration as a measure of risk. Greg's comments relate to whether we'll be "looking back on this short-term increase in yields as the warning shot for the much-anticipated longer-term rise in interest rates." Read July article.

 

Dec 9, 2012, Journal Sentinel's Kathleen Gallagher interviewed Greg Wait on current Investment Trends. Read the full article: "Low-quality stocks continue to provide strong returns."

 

 

Investment Trends column of Milwaukee Journal-Sentinel shows Top-Down investment strategies are achieving positive results.
Read article on Top-Down Investing

 

Additional articles in the Milwaukee Journal Sentinel featuring Falcons Rock:
One is a fascinating story about a Mequon drug development company, which has a few of our clients as private investors.
Read article about our angel investors

 

Another features us in the Market Trends column: Strategy targets uncertain economy - and how Falcons Rock confronts specter of slow growth.
Read how we help clients get ready

 

There is a great deal of debate in the investment industry regarding active vs. passive (indexing) investment management.  We researched this topic and the results might be surprising to you.  Please see our research paper on this subject...more

 

We have experienced interesting situations with our clients. To update you on our firm’s activities, check out examples of recent work we have done for our clients...more

Get quarterly market reviews direct from Falcons Rock President, Greg Wait.

Get current quarterly market review newsletter
Sign-up for our Quarterly Market Reviews

Subscribe to future Quarterly Market Reviews

US SIF Member 2017

The Only Constant is Change

 

2019 Q2 Client Letter

The Only Constant is Change

I’m sure you’ve heard this expression before, but there are reminders in my life every day that the only constant is change. How about you? While I learned firsthand a couple of years ago that extreme change can literally happen in a heartbeat, real change is happening every second of every day, and we all adapt…knowingly or not. In his book, Next Is Now, Lior Arussy suggests that many individuals experience frustration or even failure with changes because they treat change as an event – often an unpleasant one – that they need to get through. You can’t schedule change; it schedules itself whether you like it or not.

There is no better example of obvious daily change than in the financial markets and global economies. What makes the stock market so rare is the minute-by-minute scorecard that is produced by the exchanges. Investors can literally see change in real time and react to it. However, as I’ve described frequently, investors’ response to this real time data is often counterproductive. The ability to adapt to market changes is made better within the context of the bigger picture objectives of the investor. Changes to investment strategies are best made due to changes in an investor’s objectives, which, of course are inevitable.

Adam Grant, author of the book Originals, describes how original thinkers change the world and provides some insightful actions for impact. I believe that sustainable and responsible investing is having a powerful impact on organizations and people around the globe, and we have embraced this approach. By combining responsible investing with technology, we have created a unique service in the marketplace via our sister company, Falcons Rock Impact Investments. I hope that we can serve as an example of an organization that has embraced change.

The reality is that human beings are incredibly resilient and adaptive to change, because we must be to survive. We cannot control life’s twists and turns, but we can control our response to them. The next time you feel the weight of change, try challenging yourself to have a childlike optimism toward a new experience…you never know, it could make all the difference!

2019 Q2 Market Review

During the quarter, all broad stock market indexes continued their resurgence, albeit with a mid-quarter swoon. Large cap stocks gained more than small cap stocks and growth stocks retained their edge over value stocks. Nearly every sector in the US stock market delivered positive returns. The best performing sectors in the S&P 500 Index in Q2 included Financials (+8.0%), Materials (+6.3%) and Technology (+6.1%). The worst performing sectors during the quarter included Energy (-2.8%), Health Care (+1.4%) and Real Estate (+2.5%). On a year-to-date basis, the S&P 500 experienced its best start to a year since 1997, while reaching all-time highs.

Non-US developed and emerging markets stocks also advanced during the quarter. US fixed income markets again generated positive returns in Q2, as interest rates fell. The corporate bond sectors led the way during the quarter, while cash yields flattened a bit. The broad commodity index fell as global inflation appears to be subdued.

Here are the returns for select market indices for Q2 (as stated in US Dollars):


Responsible Investing Corner

Earlier this year, the US SIF Foundation published its 2018 Report on US Sustainable, Responsible and Impact (SRI) Investing Trends. Total US-domiciled assets under management using SRI strategies grew from $8.7 trillion at the start of 2016 to $12.0 trillion at the start of 2018, a 38% increase! SRI strategies now represent more than 1 in 4 dollars of total US assets under professional management. Since 1995, when the US SIF Foundation first measured SRI, assets have increased 18-fold, a compound annual growth rate of 13.6%. The top environmental, social and governance (ESG) criteria used by money managers and institutional investors are: Conflict Risk (terrorist or repressive regimes), Climate Change/Carbon, and Tobacco. Other prevalent ESG criteria includes: Human Rights, Transparency/Anti-Corruption, Board Issues, and Executive Pay.

BlackRock recently released a paper entitled Getting Physical, Scenario Analysis for Assessing Climate-Related Risks, which describes a process that can be used to analyze the effects of climate-related risks on investment portfolios. This very large investment firm collaborated with Rhodium Group to analyze 160 terabytes of data to assess direct physical risks to assets on a local level, both today and under different future climate scenarios – and determine whether the risks are adequately priced by markets. In the introduction to their report, BlackRock concludes that “our early work already strengthens our conviction that sustainable investing is increasingly a ‘why not?’ proposition.”

You can learn more about sustainable and responsible investing and its positive impact via the blog posts of our sister company, Falcons Rock Impact Investments.

This and That

  • Trade tensions have been a boon for Brazilian soy. While US soybean exports to China have fallen dramatically since August of last year, Brazilian soybean exports to China have increased each month.1
  • Four of the six worst performing stocks in the S&P 500 YTD through 6/30 are department stores or clothing retailers.2
  • By the year 2035, the number of Americans at least age 65 (projected to be 78 million) will exceed the number of Americans under the age of 18 (projected to be 76.4 million), the first time in our nation’s history that has occurred.3
  • “Don’t let what you know limit what you can imagine.” – William C. Taylor
  • “The reasonable man adapts himself to the world; the unreasonable one persists in trying to adapt the world to himself. Therefore, all progress depends on the unreasonable man.” – George Bernard Shaw

You’ll notice two closing quotes in this letter because I think both are particularly relevant to my change theme. Through the various changes (hopefully improvements) we have made over the years, we greatly appreciate the loyalty of our Falcons Rock clients…thank you!

Greg Wait, President of Falcons Rock

Gregory D. Wait, President
Falcons Rock Investment Counsel, LLC

1 Moody’s Economy.com, June 27, 2019
2 BTN Research, via MFS By the Numbers, July 8, 2019
3 Census Bureau, via MFS By the Numbers, June 17, 2019

Download PDF

[ Back to current review and archive list ]