(New York)

Individual bond sales to retail clients may be about to take a hit. The reason why is a new set of rules being enacted on brokers that require them to disclose the price at which they bought bonds before they sell them to clients (if it occurs on the same day). The idea of the rule is to give investors a clear idea of the price they are paying for bonds. Brokers are worried that the new rule will cut into their fees and lead investors to stop buying bonds in favor of bond funds.

FINSUM: So we understand the thrust of this rule, but as a counterargument, we ask our readers to consider: what other industries have to disclose their margins to customers during a transaction? When you buy a new iPhone, does apple need to say they have a 90% margin on the phone?

(New York)

Are you or your clients looking for income? Most seem to be. Income investments seem poised to do well over the next decade as more and more Baby Boomers retire and need income. Well, here are some of the best dividend stocks to take a look at. Unsurprisingly, they come from the group known as the dividend aristocrats, which are a group of companies that have raised dividends every year for twenty-five years. Here are some of the highest yielding names of the group: AT&T, Chevron, Target, Coca-Cola, Exxon-Mobil, and PepsiCo, among others.

FINSUM: So all these stocks are yielding well over 3%. However, the issue with them is that they have not performed very well over the last year.

(New York)

A lot of investors are worried about the stock market. The market has been essentially flat this year, but given fears over a looming trade war, a potential recession, and higher rates, there is much concern about the potential for falling prices. All that said, here is a factor that may boost markets, but doesn’t seem to be fully priced-in by the market: growing buybacks. Goldman Sachs forecasts that companies in the S&P 500 will buyback a record $650 bn worth of stocks this year, far outpacing the record set in 2007. This should lead to a buyback yield of about 3% for investors, which combined with the dividend yield should net investors about 5%.

FINSUM: A record setting year for buybacks would be a big boost for markets that are lacking a growth story at the moment.

(New York)

Advisors considering putting client capital into smart beta funds need to be prepared for what to expect. The reality is that smart beta strategies tend to accentuate the returns of the market, or run counter to them altogether. In up times a smart beta strategy playing into the market’s strengths can do much better than the index overall, the opposite can happen in down markets. However, even in decent markets, many smart beta strategies can perform terribly because of the nature of the rise.

FINSUM: If you are just getting into smart beta funds, it is really important that you understand the strategy inside and out to make sure you understand how it will sit within your portfolio.

(Washington)

The saga of the fiduciary rule seems to be never ending. Odysseas had an easier time. Now, just when things were starting to look clear—the DOL rule is effectively gone and the SEC has proposed a new one—everything is murky again. A senior figure, Michael Piwowar, at the SEC has just resigned. According to InvestmentNews, “Mr. Piwowar’s departure could significantly delay a rulemaking that already was projected to last for months — or make it impossible to complete”. Piwowar was a major ally of SEC chief Clayton, and now there are an equal number of Democrats to Republicans on the SEC commission. Trump could try to replace Piwowar and Democrat Kara Stein (whose term has lapsed) all at once, but the Senate would need to fast track approval.

FINSUM: Even if everything gets fast-tracked by Trump, the Senate needs to get the approval done, and that very well may not happen soon, especially because the Democrats might take the Senate back.