In this Question and Answer session with Dachtler Wealth Management’s Dennis Dachtler, Sacramento based wealth manager and founder of the firm, says that things are looking up. Investors remain cautious.
Q. For the third quarter, how did the Dow and the S&P perform?
Dennis Dachtler, Sacramento area wealth manager: The S&P showed its muscle with a YTD gain of 14.6%, this includes the 5.8% in Q3 alone. As for the Dow, it inched upwards with a gain of 4.3%. YTD gains for the Dow Jones Industrial Average were around 10%. (Source: WSJ, October 1, 2012, C1 US Stock Investors Look Beyond)
Q. The NASDAQ released even better numbers for the quarter. Can you clarify?
Dennis Dachtler, Sacramento area wealth manager: The NASDAQ actually did better for the year with a net gain of 19.6%. This increase was steady in the third quarter, at 6.17%.
Q. What was the driving force behind the increase in percentages?
Dennis Dachtler, Sacramento area wealth manager: There is never just one reason for an economic upturn. The Federal Reserve’s effort to pump money into a weak system seems to have paid off. As well, investors are using their dividends to reinvest. This keeps dollars flowing into the market.
Q. How much can dividends really add up to?
Dennis Dachtler, Sacramento area wealth manager: Quite a bit, actually… In fact, S&P companies divvied out over $30 billion in dividends as of August.
Q. Has the Eurozone begun its road to recovery?
Dennis Dachtler, Sacramento area wealth manager: The crisis seems to be slowing down, at the very least. The European Central Bank has even started buying out government debt. The plan is to eliminate a portion of the countries’ borrowing costs.
Q. The market tanked five years ago. How are the stocks that survived the recession performing now?
Dennis Dachtler, Sacramento area wealth manager: Most of the stocks that took such a big hit early on have recovered to near peak numbers.
Q. Is the real estate marketing picking back up? Will it ever be the same?
Dennis Dachtler, Sacramento area wealth manager: It’s hard to say if it will ever be as it was before the crash. It is making leaps and bounds in the way of recovery, however. Most analysts won’t say we are out of the woods yet, but we are definitely seeing the light through the trees.
Q. Do you think the election caused any concern in the months leading up to Obama’s reappointment?
Dennis Dachtler, Sacramento area wealth manager: Election years are always tough on the market. It’s harder for investors and traders to feel confident moving forward until the political future of the nation isn’t up the air, at least for the next 48 months.
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