Advisor Pulse: Things Advisors Need to Know

We're rolling out a new, regular list of ideas for financial advisors, compiled from an array of discussions with industry peers.

So from advisor to advisor, here's what should be on your radar this week.

Headed for a Correction?

"There's a strong case to be made for the bulls and the bears right now, so it's a really bad time to make heady predictions...technical conditions from both pivot low in November 2012 and October 2011 suggest that the index is vulnerable to a correction."

Robert Fross, partner at Fross & Fross Wealth Management

Inflation?

Keep an eye on the CRB Raw Industrials Spot Price Index, which should provide an early indication of any pickup in inflation. The index doesn't include commodities that are traded on public exchanges and is therefore less distorted by speculation. The prices of all its components except for cotton are all influenced by economic developments rather than weather."

Martin Pring, chairman and investment strategist of Pring Turner Capital Group

Cyprus

"Rising yields might be a clue that the Cyprus situation is deteriorating, while lower/stable yields might be a signal that the situation is contained. Also continue to watch the German IFO Business Climate Index and other European growth barometers for a feel as to whether the European economic situation is stabilizing or deteriorating."

Rick Vollaro, portfolio manager at Pinnacle Advisor Solutions

Small Cap vs. Large Cap

"Watch small caps relative strength to large caps--if smalls continue to lead that would likely be good for risk appetite, but if large caps take the lead it could be a precursor to a correction."

Rick Vollaro, portfolio manager at Pinnacle Advisor Solutions

FINRA's New Guidelines

"FINRA released new rules governing communications with the public. These rules, which became effective on February 4, include guidelines governing language, disclosures, and the distribution of promotional materials. For more information, FINRA has published a set of questions and answers on their website that you'll definitely want to check out."

Robert Sofia, COO and cofounder of Platinum Advisor Strategies

Earnings to Watch

"Several high profile companies lowered earnings guidance recently (Federal Express, Oracle and Caterpillar). Advisors need to watch closely to see if any more companies lower guidance. Remember: corporate profits are the lynch pin of this market. Some of the bigger earnings reporting this week are Accenture, Discover Financial, Paycheck and Dollar General."

Michael Binger, senior portfolio manager for Gradient Investments

Economic Data

"This week Id watch two consumer data points reported. Its important to monitor the confidence and sentiment of the consumer because they account for two-thirds of economic production (GDP). A strong consumer is very important to the US economy and the investment markets."

Michael Binger, senior portfolio manager for Gradient Investments

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Paula Vasan