Larry Rosenthal: Near Term Cautious, More Optimistic Q4 (Audio)

European Union. Right now, the SMP five hundred index down six, dropping three tenths of one percent to two thousand seventy three. Ness stacked down two tenths of one percent, down nine points to thirty eight down, Industrials down seventy two, a drop of four tenths of one percent. The tenure down three thirty seconds, with the yield of one point six two percent. Gold little changed up point one percent, now advancing a dollar thirty to tweight eight. I'm Charlie Pellett,

and that's a Bloomberg Business Flash. Thank you, Charlie Pellett. It is time now for the e t F Report. It is brought to you by Van Eck Vectors e t f s. Expect more from your muni's target tax exempt income by maturity and credit quality, all with low cost e t f s. Visit vanek dot com slash Muni van Eck access the opportunities. Let's go now to

Catherine Calgary for our et F report. Gold is up twenty one percent so far this year and it's trading at its highest in four weeks on growing uncertainty over whether Britain will exit the European Union and caution ahead of Central Bank meetings this week. The rally and gold is reflected in interest in e t f s backed by the precious metal. The biggest, the Spider Gold Shares or g l D, has attracted nearly ten billion dollars

since this start of the year. In contrast, e t s that focus on gold mining companies have attracted far less. On eighty million dollars has flowed into the Van Eck Vector's Gold Miners e t F so far this year. Here's Joe Foster, a portfolio manager at the The stocks are performing very well. I mean our fund is up over this year, whereas the gold price is up somewhere around so they're performing very well, but we're just not

saying the flows into the gold stocks. I think this rally caught the market off guard, and I think I think what investors are looking for is a pullback or some sort of a consolidation before they step into these equities. Foster is calling this a new bowl market for gold that's in its early stages. That's your Bloomberg etf Force. I'm Catherine Cowdery. You're listening to Taking Stock with Kathleen Hayes and Pim Fox on Bloomberg Radio. Yes, stocks are

on track for their longest slide since February. And yes, more and more government bond yields are heading below zero today. The big news the German bund the tenure note going to a negative rate. So what do you do if you're managing more than a half billion dollars worth of money for investors? Let's ask Larry Rosenthal. He's president of Roseenthalt Wealth Management Group and he's joining us from Nassas, Virginia today. Larry, welcome, Thank you for having me. How

are you today? Just great? Uh, You've been in the business for a long time. Did you ever think you'd see a day when eleven trillion dollars worth of government bonds around the world had negative yields. Definitely not UM. But that's sort of what's going on now, and it's all a movement to create stimulus and economic UH, you know movement the velocity of money UM. Savers are going to continue to be punished and risk takers are going

to continue to be rewarded with volatility. But if the banks aren't offering any incentive to park your money there or government bonds to park your money there, then you're gonna have to employ the dollars elsewhere, laury money. If you could talk a little bit about employing those dollars elsewhere.

Do you find that investors are pile into just a few names when it comes to stocks UM, your your yes, I think your your household names are getting the majority of that UH, And I do like different sectors UM from a from a short term perspective and a long term perspective. Let's take a look at the long term perspective first. For the long term standpoint, I like UH some some dividend payers, large cap UH stocks with good balance sheets in this environment, as well as the sectors

of biotech and technology going forward. Short term, I'd be cautious a little bit with your less popular names and names that have had lots of run up recently. Um, you know, the market is seeming is seeming to stall a little bit, especially ahead of the Brexit conversation as

well as the FED meetings UH this week. So little caution short term, but I think in the long term we're gonna be okay and push through this a little bit, provide the investors have the appropriate balanced portfolio that they need to accomplish their objectives and goals. And that's where some people get confused sometimes, is is looking at a short term investment versus you know, like a trade versus really investing to produce income for themselves in retirement or

college funding or the case may be there. Yeah, and this is very short term in terms of these big picture questions. The FED meeting starts today, we get the decision tomorrow, breggsit vote June. We'll see even if they leave the you know, we'll see the volatility. We'll see

what happens. You just mentioned though, for example, technology for the long term, can you give us if you can't give us a specific name that you are owning or recommending, Uh, could you give us an example of the kind of tech company you're talking about, because there's you know, if chip makers are tech, then Intel is very different from Microsoft,

is pretty different from Facebook, I would agree. And when I talk tech, the first thing I think of is how certain technology companies are changing the way you and I as individuals and businesses send and receive information. Uh, not only domestically, but as well as around the world. And the access to data, the efficiency of data is the areas that I'm really really talking about. We we like, uh, the E T F space there to buy the whole

basket versus individual companies. We just think it's a rising tide that's going to continue for several years down the road as people continue to increase their technology. I mean, just think about this. Just just imagine ten fifteen years ago going to a car dealership today and back then and buying a car that's that comes pre fitted with WiFi. Back then, we would have never understood that at all. But yet now that's happening, and it's going to continue

to happen. Technology is going to continue to change the way we send and receive information. That's going to help businesses out it's going to help people out in the healthcare sector as well, so it's gonna be well rounded. I just want to pick up on something having to do with healthcare because at the end of the Affordable Care Acts third open enrollment period, total enrollment was about twelve point seven million individuals. This shows that enrollments are

falling in each successive period. Does that affect your call on healthcare stocks? Not really, UM, the Affordable Care Act is basically designed to get people ensured, get them into the program. That's one scenario there that's different than what I'm talking about. I'm talking about biotech, UM, advanced pharmaceuticals, Alzheimer's research, cancer, hip replacement, knee replacement. That space is designed to improve quality of life and extend quality of life.

So we're very specific when we go into the healthcare space using some ets like that. I'd like to come back to technology et s. Are you saying, then, if you're looking at how information is transferred? Are you looking at ets that hold uh cloud? Uh? You know, enterprise kind of service companies? Uh? What kind? Could you just be a little more specific there? Again, tech is pretty broad. Would you do something more more specialized or are you just saying buy something it owns, you know, lots and

lots of different kinds of technology companies. Well that's a great question. Let me give you the answer from a financial planning perspective, if I may. We work with clients that are close to are already retired, so we're building and designing portfolios to accomplish their objectives at this point in life and down the road. So if we're if we're liking the tech space, we may put them into

an e t F that buys the basket of technology. However, from on a case by case basis, we may then go find a name if the stock looks to be an appropriate buy at the particular time. But we just like the entire space, along with the biotech space. Long term, viewing it from the rising tide is going to lift the whole all the boats in the harbor. All right. I noticed that you've been speaking about exchange traded funds.

Do you specialize justin exchange traded funds or would you be willing to put money to work in individual stocks? We do both. We have active and passive mutual funds as well as ets and individual stocks inside of our portfolios for our clients depending on what their objectives are and what we see in the marketplace. You know, it's it's pretty easy to to uh buy some SMP five stocks and e t F passive investment like that, uh

in the SMP five space. But when you start looking abroad at uh uh intermatt International emerging small company growth stocks there, you might want to employee active management in a mutual fund versus something that's passive. So the further away it is from the center of the dartboard, the more we would lean towards active management. How about income, If the ball market is kind of crazy right now, how do you get income dive it mpairs it is, I mean, we we look at it a few different ways.

UM dividend payers. We also like the middle of the curve as far as the bond market goes right now, UM publicly traded reats if you can put in some trailing stop losses just to limit volatility, and they're yielding very attractive numbers as well, So we do sort of a mixture between the two or three. They're depending on

the client's objectives as well. So you know, we are definitely in a yield starved environment, so we need to find quality bonds when it comes to that, and a lot of bond ladders are being you know employed now in the investment world. Uh, you know, as far as all that goes for people. Thank you very much for spending time with us. Larry Rosenthal is the president of Rosenthal Wealth Management Group, helping to manage more than six

hundred million dollars of client assets. Speaking bullish about healthcare, specifically biotech as well as technology stocks, We're going to take you through to the clothes next right here on taking stock. I'm pim Fox, my co host Kathleen Hayes, and this is Bloomberg Radio. Yeah,