Our Move Is Complete!!
We are pleased to announce the move to our new office space has been completed. 
We are now located at 324 Southport Circle, Suite 103, Virginia Beach, VA. 23452. We will be holding an open house in January for all of our clients to visit our new space, but we encourage everyone to visit in the meantime. We are always glad to have our clients drop by to see us!
Market Commentary
The events of the past few weeks have been unsettling to most investors and it deserves a brief commentary regarding our thoughts and positions, especially in view of the 513 point drop in the Dow August 4, 2011.
It is well known that we are in an economic malaise. No jobs are being created for a variety of reasons and our government’s insistence at continually throwing more money at the problem has not worked. The recent rancorous debates in Washington over the debt ceiling have not helped the markets and the average citizen’s confidence in our leadership at all levels. Washington is the only place in America where the thought is that to get out of debt that we must borrow more money. Try that with your personal finances and you will end up in bankruptcy court. The lack of leadership is appalling. Instead of trying to fiddle with every component of our economy, maybe the government ought to get out of the way and the economy will eventually heal itself.
The drop yesterday was mainly due to the economic problems in Europe. The Euro is in trouble because the northern countries like Germany are tired of paying for the poor fiscal management of Greece and Italy. Trying to blend so many countries and so many banks into one central currency may ultimately prove impossible.
More to home, the recent selloff, like all selloffs, is rattling everyone. But as professional money managers, we cannot let the tail wag the dog. We know that there is uncertainty, and yet we cannot invest your money into either Treasury Bills or CD’s because the effective rate is zero or in the case of 3 month T Bills, negative. We have to search out those opportunities that we think have value. So, as a reminder, remember that we like the stocks of multi-national companies, which produce products that are well known and that pay dividends which are higher than the 30 year Treasury bond. Companies like Procter and Gamble, H.J. Heinz, Verizon and Dominion Resources compose the bulk of our positions. All of these companies produce good dividends and have strong growth prospects. No matter how bad the economy is, people are still going to need Tide detergent (P & G) to wash their clothes or tissue paper to blow their nose (Kimberly Clark), and they certainly are not going to give up their smartphones (ATT or Verizon). This selloff gives us an opportunity to buy these same quality companies at a discount. As an example, I have been watching Advance Auto Parts for some time. They have a good business model in the auto aftermarket with over 3,000 stores in the U.S., Puerto Rico and the Virgin Islands. Six months ago this was a $72 stock. Yesterday it closed at $52.72 a discount of 26.75%. It has now been added to our watch list. In addition, we keep a certain amount of your holdings in cash not only for safety, but for buying opportunities such as this. Our portfolios are well designed and multi-layered with various types of holdings in stocks, Exchange Traded Funds, preferred stocks, bonds and mutual funds, and we use a well balanced approach. When the markets go down we use trailing stops on some positions to lock in gains and we dollar cost average into those investments that we believe are on sale.
Remember, “Panic” is not an investment strategy. We may raise your cash position a bit, but we are not going to sell off perfectly good investments just because of the trouble both domestic and abroad. These panic sales can have unintended consequences like tax gains which may present a whole series of problems come next April 15.
Karrie, Nickie and I spend our entire days monitoring the situation and watching over your accounts. We make educated and well planned decisions. We keep our feet on steady ground, making in some cases, hundreds of decisions per day on our accounts. We ask that you respect our judgment and trust that we will always put your concerns first. We will come out of this as we always have.
Thank you.
William H. Sheavly, CFP®
Chief Investment Officer
Trip to American Century
Bill Sheavly Attends Meeting with American Century
Bill attended a two-day investment meeting with American Century Investments in Kansas City, Mo. on May 15th and 16, 2011 for Investment Advisors. The meeting, which was held at American Century’s home office, was an opportunity to hea
r several mutual fund managers speak about their funds and their economic outlook going forward. Almost 100 financial advisors attended the two-day meeting.
One of the highlights was an outstanding speech made by Mike Eurizone, the Captain of the U.S. Olympic Hockey Team, which went on to defeat the Russians at the 1980 Winter Olympic Games in Lake Placid. In the 2004 Disney movie, “Miracle,” Mike was portrayed by the actor Patrick Dempsey. Mike’s presentation was a wonderful and colorful story about the hockey team and how the coach built a successful team out of all of the headstrong hockey players. Bill was also able to personally meet with one of the portfolio managers, Jonathan Bauman, CFA (pictured) who is a manager with American Century Growth Fund. They discussed his philosophy and how American Century uses momentum investing as part of their stock selection process.
New Web Site
Sheavly Financial Group would like to welcome you to our new presence on the internet. If you have any questions, please feel free to give us a call.
