Revenge of the Asset Allocators? - Finding the Next Bull Markets

Sticking with a specific investment strategy - instead of jumping ship after disappointing cycles - tends to pay off, in the end, even though it can be irritating, frustrat-ing, scary, and seem pointless at times. As hard as it may be to believe, this would have been true even in the aftermath of the Great Crash of 2008, which is shown a little to the right of the middle S&P 500 chart, below (see post-crash market bottom at blue arrow). Even those who invested at the peak in 2000 (or in 2008) but stuck to their guns and soldiered on through the heartache would be strongly profitable by now, as the chart shows. Those that bailed during the plunge and fled to the “safety” of bonds, annuities, or other “smarter” invest-ment paths likely never recovered (let alone soared), though they may know it not. Not every year is a cause for celebration, but, in the end, sticking with a sound strategy tends to pay off and patient money tends to turn out to be smart money.

Chart source: http://finance.yahoo.com/echarts?s=%5EGSPC+Interactive#{}

Last year seemed like an unusual one for investors. Portfolios focused on U.S. Large Cap stocks – like Camarda’s Viking and Strong Stock individual stock portfolios – did relatively well, while asset allocation/“pie chart” styles, like Camarda’s ISIS™ and much of the mainstream investing world’s offerings really underper-formed, since the latter diversify into many different as-set classes and, hence, have only a small portion in U.S. Large Caps at any point in time. In fact, this has been more or less the case for the past few years, as the U.S. Large Cap market has screamed upward (see above) from the March 2009 low. While we are quite proud of Camarda’s ISIS™ performance during this unu-

sual period, we think the wind may really be at its back going forward. The times may be a-changing, and as we have noted, since at least the middle of last year. We’ve expected the performance leadership baton to shift to non-U.S. Large Cap asset classes like foreign markets, which seems to have been the case so far this year, with the U.S. Large Caps largely flat up to this point, while stock markets in Europe, Japan, Chi-na, and even Brazil and Russia, for instance, have done much better overall – a condition we expect to continue going forward. We expect the asset classes that predominate the ISIS™ portfolios – non-U.S. stocks and non-Large Cap U.S. stocks – to outper-form, in the years to come. In a nutshell, we are very pleased with ISIS™ per-formance during a period when the style faced a fierce headwind, and are really excited about what may be if the expected tailwind picks up. We see the first indica-tions of this, we think, in the right end of the blue ISIS™ Capital Appreciation graph, below, showing a nice first quarter growth of 2015, while the red- graphed S&P 500 was flat to slightly down during the same period. This may herald a period of non-U.S. Large Cap-driven outperformance for ISIS™, such as what we saw for most of the 2000-2007 periods, in the graph below. Let’s hope so – we think the time is right. Getting back to the stick to a strategy for the long-term theme, it’s been a while since we reflected on ISIS’s™ long-term performance, as indicated since 2000 on the graph, below. ISIS™ CA is the blue line, the recently-wonderful S&P 500 is the redline, and the newly-resurgent NASDAQ is the bottom black line. We think the long-term results just speak for themselves, and are very excited about the prospects for the years

ahead.

A W O R D F R O M J E F F M a y ‘ 1 5 V O L U M E X I I , I S S U E V

™

Important disclosure on the last page.

Join your Camarda wealth leaders – Jeff, Sonja,

Jonathan, and Rob Shevlin - on Wealth Education

Radio! Slashing taxes. Dominating risks. Relentlessly

pursuing profits, protecting your assets, and keeping

you in stitches while leading to greater riches. Our

goal is to painlessly educate you with shrewd advice

to help grow and protect your wealth. We aim to be

the Car Talk of financial radio – entertaining, hugely

funny, and offering penetrating financial insight and

expertise across a broad spectrum of wealth-related

topics. Tell your friends, and be sure to tune-in on

these powerful stations serving much of Florida:

WOKV Jacksonville, AM 690/FM 104.5, Sundays at

5pm, and WWBA AM 820 Tampa Saturdays at 1:00

PM. If you have questions to be answered on the air,

email Jeff at show@camarda.com, or tweet us

@camardawealth!

Can Tax Savings Really Supercharge Your Wealth?

Feel like your wealth’s being taxed to death? Feel

like you’re making plenty but not keeping enough? For

many people, taxes are the single biggest obstacle to

building wealth faster, which stands to reason since a

huge percentage of annual income, that could be

saved and invested, often evaporates to taxes in-

stead.

Unlike much else, in life, with taxes, it’s not who

you know, but what you know! And there’s a lot to

know – so much that various studies conclude that

even IRS employees only understand between 55%

and 83% of basic tax facts. As of 2006, the Federal

tax rules totaled over 13,000 pages – and the rules

have grown more complex since. Many of these rules

exist to try to counter the tax reduction strategies that

the most proactive taxpayers – and their advisors –

keep coming up with to legally keep wealth in their

families’ pockets, instead of the IRS’s. But for IRS, it

can be a game of catch up, with the best advisors

Camarda’s Wealth Education Radio Comes to WOKV

finding new opportunities faster than IRS can close old

ones. Great complexity can breed great opportunity,

and “sophisticated taxpayers take advantage of the

complexity to find loopholes that lower their tax liabil-

ity.”

It’s like the old saw, “What’s the difference between

tax avoidance and tax evasion? Twenty years in Leav-

enworth!” The point, of course, is that tax avoidance is

perfectly legal, and often remarkably easy, if you know

where to look. For instance tax arbitrage – using the

differences between tax rates applicable to different

kinds of entities (C vs. S corporations, for instance) or

different individuals (you and your children for instance)

– can save some people a real bundle.

The opportunities to legitimately save enormous

dollars can be profound, if you know where to look. Un-

fortunately, some tax preparation professionals may

not be the right place. According to a Money magazine

study cited in the MIT book, not one tax prep profes-

sional was able to produce a correct return! Often,

even the most basic tactics, like controlling taxable in-

vestment income, or maximizing tax deductions, are

completely missed. Good tax advisors are worth their

weight in gold, but can be very hard to find, especially if

you don’t know how to tell the difference.

If you own a business, are a high income profes-

sional, or have significant investment accounts

(whether you are retired or not) you may be leaving

way too much money on the table.

Will Power

Nearly 65% of adults in America admit they don't

have a will, which may not be entirely surprising.1 No

one wants to be reminded of their own mortality or

spend too much time thinking about what might happen

once they’re gone.

But a will is an instrument of power. Creating one

gives you control over the distribution of your assets. If

you die without one, the state decides what becomes of

your property, without regard to your priorities.

A will is a legal document by which an individual or

a couple (known as “testator”) identifies their wishes

regarding the distribution of their assets after death. A

will can typically be broken down into four main parts.

Executors — Most wills begin by naming an executor.

Executors are responsible for carrying out the wishes

outlined in a will. This involves assessing the value of

the estate, gathering the assets, paying inheritance tax

(Continued on page 3)

C O M M E N T A R Y

and other debts (if necessary), and distributing as-

sets among beneficiaries. It is recommended that

you name at least two executors in case your first

choice is unable to fulfill the obligation.

Guardians — A will allows you to designate a

guardian for your minor children. Whomever you

appoint, you will want to make sure beforehand

that the individual is able and willing to assume the

responsibility. For many people, this is the most

important part of a will since, if you die without

naming a guardian, the court will decide who takes

care of your children.

Gifts — This section enables you to identify people

or organizations to whom you wish to give gifts of

money or specific possessions, such as jewelry or

a car. You can also specify conditional gifts, such

as a sum of money to a young daughter, but only

when she reaches a certain age.

Estate — Your estate encompasses everything

you own, including real property, financial invest-

ments, cash, and personal possessions. Once you

have identified specific gifts you would like to dis-

tribute, you can apportion the rest of your estate in

equal shares among your heirs, or you can split it

into percentages. For example, you may decide to

give 45% each to two children and the remaining

10% to a sibling.

The law does not require that a will be drawn up

by a professional, and some people choose to cre-

ate their own wills at home. But where wills are

concerned, there is little room for error. You will not

be around when the will is read to correct technical

errors or clear up confusion. When you draft a will,

consider enlisting the help of a legal, tax, or finan-

cial professional who may be able to offer addition-

al insight, especially if you have a large estate or

complex family situation.

Preparing for the eventual distribution of your

assets may not sound enticing. But remember, a

will puts the power in your hands.

You have worked hard to create a legacy for

your loved ones. You deserve to decide what be-

comes of it.

What Do Your Taxes Pay For?

Taxes are one of the biggest budget items for

most taxpayers, yet many have no idea what

they’re getting for their money.

In 2015, as in recent years, Americans will

(Continued from page 2) spend more on taxes than on groceries, clothing,

and shelter combined. In fact, we worked until late

April just to earn enough money to pay our taxes. So

what do all those weeks of work get us?1

The accompanying chart breaks down the $3.5

trillion in federal spending for 2014 into major cate-

gories. By far, the biggest category is Social Security

and income programs, which consume one-third of

the budget. This includes Social Security, retirement

and disability programs for federal employees, food

assistance, and unemployment compensation. An-

other 18% of the budget goes to defense and related

items, and 24% goes to Medicare and health pro-

grams.2

Are taxes one of your biggest budget items? Take steps to make sure you’re managing your over-all tax bill. Please consult a tax professional for spe-cific information regarding your individual situation.

Special Camarda Announcement By Jeff Camarda

It is with great regret we announce that Deborah

Romanoski has left Camarda Wealth Advisory

Group due to personal concerns. She has been with

us for 10 strong years and made invaluable contribu-

tions to our growth and quality. We wish the best for

her, her daily presence will be sorely missed, and

we are truly forever grateful for everything that she

has done. Deborah, life is full of wonderful adven-

tures and you are about to embark on a new one!

We had a fabulous time hosting your “retirement”

party at the Florida Yacht Club, and we wish you

nothing but the best for your future. With that being

said, we are grateful to announce that Corey Cook

will be stepping in as the new Client Services, Mar-

keting and Social Media Coordinator. Corey has just

recently graduated from the University of North Flori-

da as a marketing major, and has produced solid

results for us as an intern before graduation. We are

excited to see what all you will bring to the Camarda

family. Welcome aboard!

1. Forbes, September 15, 2014

Deborah Romanoski

Source: Center on Budget and Policy Priorities, 2015 Tax Foundation, 2015 Center on Budget and Policy Priorities, 2015

C O M M E N T A R Y

I n s i d e T h i s I s s u e :

4 3 7 1 U S H i g h w a y 1 7 , S u i t e 2 0 1 , F l e m i n g I s l a n d , F L 3 2 0 0 3 (904) 278-1177 • Toll Free: 1-888-CAMARDA• camarda.com

Revenge of the Asset Allocators? - Finding the Next Bull Markets ….......................1 Camarda Wealth Education Radio Comes to WOKV……..…………………………2 Can Tax Savings Really Supercharge Your Wealth?.…....………………………….…2 Will Power ...…………………………………………………………………2&3 Special Camarda Announcement ...………………………………………...……..3 Camarda News.…...…….……….…………………………….…....…………. 4

“Fishy” Emails? Helpful Tips For Spotting A Phishing Email! Don’t catch yourself in a situation like a fish out of the water! Countless phishing email attempts happen daily, and all phishing attempts appear in multiple forms. At Camarda Wealth Advisory Group, we want our clients vigilant of all the potential dangers that may arise in this digital age. Even though some phishing attempts may appear more obvious than others, we would like to address common types of phishing attempts.

Common types of phishing include urgent messages, links to a fraudulent websites, generic greetings (e.g. “Dear Customer” or “Welcome Member”), and “lost information” that needs re-entering. Regarding personal information re-quests (i.e. asking for your social security number and other sensitive information), Camarda Wealth Advisory Group nor our custodian of assets will ask for such classified details via email; we will either call you or set up an appointment with you.

It is of vital importance for you to identify these types of messages, in order to best protect yourself against phishing scams. Upon receiving and identifying a phishing email, immediately delete it. The deleted email will then move to your deleted items folder - which you should also delete - in case you mistakenly access the email again. We hope that you have gained some insight and knowledge about how to effectively spot a phishing email; after all, in the midst of life, we all have bigger fish to fry than to become trapped in a phishing scam!

IMPORTANT DISCLOSURE INFORMATION Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by Camarda Wealth Advisory Group), or any non-investment related content, made reference to directly or indirectly in this newsletter will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, includ-ing changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained in this newsletter serves as the receipt of, or as a substitute for, personalized investment advice from Camarda Wealth Advisory Group. To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encour-aged to consult with the professional advisor of his/her choosing. Camarda Wealth Advisory Group is neither a law firm nor a certified public accounting firm and no portion of the newsletter content should be construed as legal, accounting, or tax advice. The performance results shown reflect the reinvestment of dividends and other account earnings, and are net of transaction and custodial charges, investment man-agement fees and the separate fees assessed directly by each unaffiliated mutual fund holding within the portfolio. The historical index performance results are provided exclusively for comparison purposes only, so as to provide general comparative Information to assist an individual client or prospective client in determining whether a specific portfolio meets, or continues to meets his/her investment objective(s). It should not be assumed that account holdings will correspond directly to any of the com-parative Index benchmarks. The historical index performance results are provided exclusively for comparison/illustrative purposes only, so as to provide general comparative information to assist an individual client or prospective client in determining whether a specific Portfolio meets, or continues to meet, his/her investment objective(s). It should not be assumed that account holdings will correspond directly to any of the comparative index benchmarks. Benchmark returns have a one percent (1%) management fee removed as the indexes them-selves cannot be invested in free of charge. The S&P 500 is one of the world’s most recognized indexes by investors and the investment industry for reflecting overall performance of the U.S. equity market. The S&P, however, is not a managed portfolio and is not subject to advisory fees or trading costs. The NASDAQ Composite Index is a market-capitalization weighted index of the more than 3,000 common equities listed on the NASDAQ stock exchange. The types of securities in the index include American depositary receipts, common stocks, real estate investment trusts (REITs) and tracking stocks.

If you are a Camarda Wealth Advisory Group client, please remember to contact Camarda Wealth Advisory Group, in writing, if there are any changes in your per-sonal/financial situation or investment objectives for the purpose of reviewing/evaluating/revising our previous recommendations and/or services. A copy of the Camarda Wealth Advisory Group’s current written disclosure statement discussing our advisory services and fees is available upon request. Some of the material in this was developed and produced by FMG, LLC, to provide information on a topic that may be of interest. FMG, LLC, is not affiliated with the named broker-dealer, state- or SEC-registered investment advisory firm. The opinions expressed and material provided are for general information and should not be considered a solicitation for the purchase or sale of any security. Copyright 2015 FMG Suite.

C A M A R D A N E W S BY COREY COOK