Dightman Captial Group
We manage adaptive investment strategies for individual investors, as part of a comprehensive planning environment, designed to protect capital in sustained market contractions and grow capital during market expansions.

Market & Economic Summary

  

Dightman Capital believes one of the key to success in today's environment is to remove entrenched investment biases and implement an adaptive investment process and execution ability. 

The following is our opinion of near-term market and economic conditions.

SPRING 2012

GLOBAL INVESTMENTS
After a very strong rally in Q1, which was a continuation from Q4 2011, stocks have come under selling pressure.  A normal market correction should be expected but investors may want to be on guard for a more sustained market decline given the fragile nature of the current environment. 

WORLD ECONOMY
The Data coming out on the global economy still poses serious challenges.   The debt crisis in Europe could eventually pose liquidity challenges.  Unemployment in the U.S. remains elevated but appears to be improving somewhat.

INFLATION DATA
We believe broad inflation will remain stable for goods and services measured by the Consumer Price Index.  There are risks of elevated prices in select categories like education, healthcare and energy.  Despite current U.S. monetary policy, inflation is likely to be held in check until National Income and Capacity Utilization have increased.  As developed country economies continue to reduce debt levels, deflation in stocks, real estate and commodities may continue.

U.S. RESIDENTIAL HOUSING
It appears housing may be stabilizing in some markets but price recovery may be slow. 

PLANNING
New conversion rules for ROTH IRAs allow high income households an opportunity to fund this unique tax treatment retirement account.

Advances in Investment Theory

Discipline
A fundamental shift is underway in the investment management and financial planning professions with the goal of enhancing Modern Portfolio Theory (MPT). Developed in 1959, it is hardly modern. This shift has led to a more rigorous analysis of projected investment returns, a wider selection of financial instruments, and enhanced investment techniques by portfolio managers.

  • Investments available today offer an opportunity to customize the asset mix, manage cost and control risk which may improve performance for investors
  • New investments have been complemented with an array of readily available tools to track and analyze financial information

MPT is still used widely today and incorporates assumptions that present difficulties in current markets. Normal distributions do not accurately match historical return patterns and the frequency of rare events (extreme negative returns) are underestimated. Over long-time frames (decades) these limitations have less impact, but within shorter-time frames these limitations can be examined and potentially addressed in the construction and/or management of an investment portfolio.

Portfolio Composition
At Dightman Capital Group, we utilize broadly diversified portfolios but offer investors an ability to go beyond a traditional mix of U.S. stocks and bonds in the management of their portfolio. We also believe in the utility of indexing and many of the investments we recommend are indexed based.

We offer global growth portfolios from conservative to aggressive and shift allocations between asset classes for changing conditions.

Controlling Costs
Investment expenses are assessed in a variety of places: management fee, investment expenses, brokerage commissions, tax liability, and service fees just to name a few. Keeping costs low in each of these areas means you have more money to grow.

Other important topics related to investment strategy include:

Benefits of Risk Management

About Index Investing