                                  
  
In correction mode but still positive for 2014.
Despite some real optimism that developed in the fourth quarter of 2013, markets had a bumpy ride during
the first quarter of 2014. The volatility was caused by several factors and heightened by tensions between
Russia and Ukraine and the Fed’s continuation to scale back its asset purchase program.
Even though we believe this stock market correction is long overdue, the current risks need to be respected.
We are taking defensive measures on a short-term basis. As such, we have taken profits and are waiting for
conditions to subside and improve to get more invested.
Once the markets resume their bull market trajectory and the volatility subsides, we will add to our
positions. We are focusing on companies with high earnings growth potential and reasonable valuations. As
long-term investors we embrace the volatility and use the pullbacks to buy strong companies at reasonable
prices. It is important not to get too negative on the markets, more specifically, growth stocks. History has
proven that growth and new innovation have always been a successful recipe for future stock market
leaders. The Biotech group has been impacted by headline news but we feel once the correction is over we
will revisit the leading companies in this area. They have very strong fundamentals going forward. Stocks
remain an attractive investment alternative compared to the low returns earned from CD’s, bonds, and other
short term instruments.
The economic recovery is still very much in its infancy stage. Some
analysts say it may be the longest recovery ever, however, we still
expect a return of 7%-10% by year end. The road to such a return could
be bumpy amd we will adjust our positions accordingly. We remain
confident as the U.S. economy continues to improve, interest rates
remain unusually low, and no expectations for any surprises from
Washington, D.C. The only way the market would really start to break
down is if geopolitical tensions heat up or the macro data weakens
substantially.
Again, once this correction runs its course and the market adjusts—the
market can and will sustain higher levels. There’s a lot that needs
sorting out but also a lot of time left in the year. The fundamental
factors (earnings, interest rates and inflation) under pinning our view of
the 2014 stock market are still strong therefore we still believe 2014 can
be a positive year.
Happy Spring. Please feel free to contact us with any questions.
Look forward to seeing you soon.
LOU’S PICK
FACEBOOK
We still like
Facebook. The first
quarter ad revenue
should surpass expectations and the
company’s overall first quarter results
should beat consensus by a healthy
margin. The mobile ad driven story
should continue. Also, COO of
Facebook Sherly Sandberg loves her
job and is not planning to leave. Profit
margins continue to rise and future
earnings are still strong.
SAVE THE DATE JUNE 5, 2014
CATAMOUNT’S SIP & PAINT
Bring a friend
Details to follow
WOMEN
AND FINANCE
INHERITED
at the Westport Public Library
S
If you are the child, sibling or friend of an IRA owner who has named you
as their beneficiary, you must understand the rules that govern IRA
inheritances. If you do not, you could end up paying higher taxes,
penalties and forfeiting the opportunity for future tax-advantaged growth.
The IRS requires IRA owners to start taking minimum required
distributions (MRD) no later than April 1 following the year in which they
turn 70½. These same rules apply to whoever inherits an IRA. Distributions
taken prior to age 59½ could be subject to a 10% early withdrawal penalty,
depending on the type of IRA.
If you inherit IRA assets from someone other than your spouse, you need
to transfer the assets to an inherited IRA beneficiary distribution account
(IRA BDA)—you can’t roll it into your own IRA.
Generally, you have until Dec 31 of the year following the original IRA
owner’s death to take your first MRD. Each year thereafter you are
required to take an MRD until the account is depleted or you pass away.
If you pass away, it will transfer to your designated beneficiary.
If the original IRA owner died before reaching age 70½ you also have the
option to distribute your inherited IRA under the 5-year rule. This allows
you to take distributions however you like without penalty, but all assets
must be distributed by Dec 31 of the fifth year following the IRA owner’s
death.
If the original IRA owner died after reaching age 70½, you must continue
to take annual MRDs from your inherited IRA. You may elect to calculate
those MRDs by using your own age or by using the deceased IRA owner’s
age in his or her year of death. This option may be advantageous if the
deceased IRA owner was younger than you.
If you are listed as a non-spouse beneficiary along with one or more other
beneficiaries, you must separate your shares of the decedent’s IRA and
then complete your first MRD by Dec 31 of the year following the original
IRA owner’s death. If you don’t, your MRD calculation will be based on the
oldest beneficiary’s life expectancy.
Determine whether you are listed as someone’s beneficiary. While it may
be a sensitive topic to broach, knowing in advance that you are listed as a
beneficiary can help you avoid some potentially costly mistakes. As life
events such as marriage, divorce, and deaths occur, it’s in your best
interest to confirm that beneficiary designations are up to date.
Remember that IRA beneficiary designations supersede a will.
WEDNESDAY
April 30 at 6:30 pm
Mahnaz Mahdavi,
professor of
Economics and
Director of Center
for Women and
Financial
Independence at
Smith College,
speaks on the need
for improvement in
women’s financial
literacy.
Co-sponsored with
Catamount Wealth Management
For more information contact:
Jennifer at 203-226-0603 or
[email protected]
Catamount is a proud supporter
of Westport Country Playhouse,
recently named “Theater Company
of the Year” by The Wall Street
Journal! The upcoming 2014
season includes 5 productions that
offer a rich variety of theatrical
experiences worth talking about.
www.westportplayhouse.org
INTERN
PROGRAM
In May, Catamount will
participate in Staples
High School’s Senior
Internship Program
by hosting a student
intern for 4 weeks. The unique
program will give students the
opportunity to get hands-on
working experience in an area of
his and her interest during the last
few months of the school year.
Catamount Wealth Management ❘ 943 Post Road East, Westport, Connecticut 06880 ❘ 203.226.0603 ❘ www.catmg.com