Broker Check

November 2023 Newsletter – The 40 Year Trend Changes

November 2023 Newsletter – The 40 Year Trend Changes

Uniquely Waterstone for our unique Waterstone clients 

In this Issue: 

  • Magnificent Seven drive the market
  • Harvard Investment Return
  • Julex Client Opportunity- Friday, Nov 10, 11 am webinar
  • AI – We’ve been using it!
  • Reading about Crypto
  • Lucky us in Rochester!

The last 40 yrs have been one type of environment- falling interest rates/falling inflation. We pivot into a different era. We need our investment partners to navigate on our behalf.

Same market leadership, new buzzword- Meet the Magnificent 7”.

Narrow market leadership persists as the internet era created giant platform businesses with winner-take-all-or-most economics unprecedented in the past. Earlier known as Fang, FAANG, or FMMG acronym these stocks are now called the “Magnificent 7 (Facebook, Apple, Amazon, Netflix, Google, Tesla, Nvidia). More recently, the 7 largest companies are even larger than the earlier bunch.

So far in 2023, these 7 stocks have generated nearly the entire return of the S&P. The other 493 stocks mustered a measly 1.2% return of the S&P 500. (

Harvard and other smart guys.

College endowments are a key to the financial wellbeing for student tuition experiences, faculty research, emergency needs, etc. Higher Ed fiscal years end June 31 with the school year.

Harvard Management Co said on Oct. 19 that it earned a 2.9% ending June 2023 on it’s total endowment at $50.7 billion. A year earlier it lost 1.8% amid tumbling markets.

Yale University returned 1.8% while the University of Pennsylvania returned 1.3%. The Massachusetts Institute of Technology reported a loss of 2.9%. Columbia University gained 4.7% and Stanford earned a 4.4% return. 10/20/23

Opinion: Evidently, the college endowments are not overly dependent on the S&P500.  

Client Opportunity:

Julex Capital Founder Henry Ma and Educator Dr. Rob Brown

What Is TAA, Why Does It Work, And Why Should You Use It?

Friday, November 10, 2023 11:00 AM – 11:45 AM (EDT)

Or dial in (224) 501-3412 using Access Code: 853-720-213

AI and Investment Strategy

Beaumont Capital Management (BCM) remarks that they are amused with the recent hype over artificial intelligence, as many of these technologies have been around and in use for decades.  Think Big Data. 

“We caution against using AI tools for critical decision making when..

1) the mathematics and methodology underlying those tools are not well understood by the user 


2) the framework that the AI system uses for decision making is opaque. 

Serious decisions still need human oversight or verification. BCM supports the SEC’s efforts to regulate use of AI in the financial sector as a good balance to protect clients with tools for investment professionals.”

Opinion:  AI is not going to be the magic for “UPS and UPS and UPS “in the markets.

I read them both twice! I found Easy Money to be an excellent overview of crypto from it’s origin to current. Going Infinite reports on Michael Lewis’s two year experience with living in the world of Sam Bankman-Fried and FTX.
Opinion/Personal Hypothesis: crypto’s casino mindset may have re enforced what we see with the Magnificent Seven of the S&P 500.

Lucky us in Rochester:
The Company Theater Rochester is a gem, honoring tradition through innovation (classic plays done in new ways!) Romeo and Juliet was superb!! Next is The Man Who Came to Dinner (1939 comedy) Dec 7 to Dec 17. for details.

Roc Holiday Village - I heard the founders of Rochester’s Holiday Village discuss their worldwide research into Christmas Markets around the world. Their intent: the best of each market! Open Wednesdays thru Sundays in Dec at the Martin Luther King Jr Park, it’s a special experience for all. Visit for details.

T’is the season. Enjoy family and friends!

Note: Kathy will next be in the office December 5 to December 13. Cheers to Josh who is local, available and always appreciated.

Thanks if you've read to the end. You're our kind of people.
Reach out to us with your questions, comments, needs. 

Securities offered through American Portfolios Financial Services, Inc.(APFS) Member FINRA /SIPC. Investment Advisory Services offered through American Portfolios Advisors, Inc. (APA), an SEC Registered Investment Advisor. Waterstone Financial Services is not affiliated with APFS and APA. 

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