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Cheers & Jeers
Saturday, December 24, 2011
Heather Long

CHEERS... to companies such as PinnacleHealth, Giant and Roof Advisory Group for making donations to the Central PA Food Bank to ensure no goes hungry this weekend. There are no Scrooges in this Town...

2012 Best Wealth Managers
Friday December 2, 2011

1. What are your predictions & thoughts for 2012 with regard to the wealth management as a whole &/or your specialty area?

In 2012, volatility will likely to continue to impact the markets in a notable fashion and adequately funding retirement will continue to be a core issue for most everyone. The result is that investors will continue to become increasingly aware of how they pay for services, the inherent levels of risk to which they are being exposed and the net value that they receive from the professionals that they hire.

In the investment management and financial planning arenas specifically, firms that provide independent, fee-only and customizes services will continue to be seen as a superior option for the people who have outgrown the cookie-cutter and off-the-shelf products that are sold by most organizations.

Bradley R. Newman, CFP® is with Roof Advisory Group, Inc., an independent investment management and financial advisory firm based in Harrisburg. The firm is a fee-only Registered Investment Advisor that provides portfolio management and financial planning services for individual and institutional clientele. The firm's email address is

2. What advice are you currently giving your business clients as they prepare for a successful 2012?

Our advice to all business owners for the upcoming year is to concentrate on some of the areas that our firm has regularly focused on with our business owner clients. There are a myriad of items that have not likely received adequate attention either due to lack of awareness or due to time constraints.

A key example, which is coming under increased regulatory scrutiny, is the need to understand and meet your fiduciary obligations with regard to the investment portion of your company's retirement plan; providing appropriate investment alternatives can be even more impactful than managing plan costs. It is critical that you have processes in place to meet those fiduciary obligations and the documentation available to quantify the process utilized in performing your ongoing due diligence. The 401(k) retirement plan is becoming one of the most publicized retirement plans for fiduciary responsibility and the first step toward an employer meeting their fiduciary obligation is to hire a completely independent firm to provide a comprehensive third-party evaluation of the plan.

E. Jeffrey Roof, President of Roof Advisory Group, Inc., an independent investment management and financial advisory firm based in Harrisburg. The firm is a fee-only Registered Investment Advisor that provides portfolio management and financial planning services for individual and institutional clientele. The firm's email address is

Euro effect: Europe's fiscal crisis not hitting Central Pennsylvania - yet
Friday December 2, 2011
Tim Stuhldreher

...Dire as they are, the travails of the eurozone would have to become far worse before they began affecting the midstate, local financial industry professionals said.

However, "far worse" is the direction they seem to be heading.

"We're in uncharted territory," said Jeffrey Roof, president of Harrisburg-based fee-only investment firm Roof Advisory Group Inc. ...

...European officials already are worried about liquidity in the European banking system, according to media reports. A crisis would intensify those problems, pushing borrowing costs sharply upward in world markets and impacting American banks, Roof said...

...And what about midstate investors with European exposure? Local advisers have mixed views on what action they should take.

"It is important that investors do move" and not try to ride out the storm, Roof said.

"We have moved out of European exposure, and we will remain out until we see ... a clear endgame," he said...

...Whether investors will continue to view U.S. debt as safe, given the tenor of U.S. politics, remains to be seen, Roof said.

Q&A Ask the Experts: Financial Whizzes Weigh In
Text by Patti Boccassini
November 2011
E. Jeffrey Roof

...Why has the stock market been on such a rollercoaster ride for the past several months and how should investors deal with this?

Investment markets have indeed been experiencing significant volatility since mid-summer. These wild daily swings have been driven more by investor fear of what could happen, as opposed to what actually did happen. You are invited to click on our most recent "Investment Update" at for more specific details but several key concerns have contributed to this crisis in investor confidence. The first is concern that the slow U.S. economic recovery is potentially faltering and there is a chance of slipping back into another recession. We see this possibility as being rather unlikely but the markets have remained unconvinced. Second, investors have been bombarded on a day-to-day basis with headline news showcasing all of the unknowns surrounding the European financial mess, specifically the potential fallout from a Greek debt default. Uncertainty regarding the depth and breadth of this crisis has continued to keep investors on edge and roil the markets. Additionally, investor confidence in the ability of government leaders, both here and abroad, to successfully address critical financial policy issues such as growing deficit spending, etc. was dramatically shaken in mid-summer by the incessant wrangling and lackluster outcome of the U.S. debt ceiling debates. More damage was done to investor psyche by the political spectacle than by the actual downgrade in the U.S. credit rating that resulted.

Inertia and anxiety may tempt investors to either just sit on the sidelines in cash or stay fully invested and just "ride it out." Neither of these is an ideal portfolio management strategy for these challenging market conditions. The best approach is to clearly understand your portfolio's structure, composition and inherent risk relative to the market. Then you can modify your portfolio to better weather these volatile times by:

  1. Incrementally reducing your overall equity exposure by first eliminating the riskiest positions
  2. Changing the makeup of your equity holdings to lower beta and reduce the portfolio's overall volatility
  3. Increase the dividend yield being earned by the equity portion of your portfolio because that extra income will help temper downward market moves, plus high-quality equity yields are currently much more attractive than fixed income alternatives...

Seeing Red: Local leaders mull economic tumult
Friday August 19, 2011
Tim Stuhldreher

Debt downgrades. Stock market fluctuations. Widespread pessimism about the nation's economy and government.

How should midstate business people react to all the worrisome news dominating the front pages? ...

Bradley Newman Certified financial planner with Roof Advisory Group Inc.

Despite the notably dour tone and market impact of recent events, this is not a time to panic. However, this not a time to simply "ride it out" or "hunker down" either.

Recent events are having a very real impact, but are not "new news." To the contrary, these events have been unfolding over the past three months. Our firm began making adjustments to our clients' portfolios in May when serious concerns emerged.

Assuming investors already have clear and appropriate investment parameters based on their circumstances, the current environment presents select opportunities to rebalance core positions up their target levels in a disciplined fashion.

Regulators work steadily to recover ARS investments
Friday July 29, 2011
Tim Stuhldreher

...It seems clear that ARS sellers either willfully sold inappropriate products to clients or didn't understand what they were selling, and "neither one is a great outcome," said Bradley Newman, certified financial planner for Roof Advisory Group, Inc., an independent fee-only investment and financial advisory firm based in Harrisburg.

"These were being sold as safe, cash-equivalent investments," he said. "That's inexcusable."

Dodd-Frank: Much remains uncertain on law's first anniversary
Friday July 22, 2011
Tim Stuhldreher

...Nor, despite some welcome moves toward greater transparency, does Dodd-Frank significantly improve protections for the average investor, said Bradley Newman, a certified financial planner for Roof Advisory Group Inc., an independent fee-only investment and financial advisory firm based in Harrisburg.

They must continue to enter any investment relationship "with their eyes wide open" and ask the right questions he said.
    "'How are the people I'm dealing with compensated? What potential conflicts of interest exist in the relationship?'" he said.
    "They can't assume that someone else is going to be looking out for them," he said.

Rates make refinancing easier, but rates vary
Friday April 1, 2011

Tim Stuhldreher

What's the big trend in corporate finance these days? Getting better credit terms.

Spurred by interest rates at near-record lows, large U.S. companies refinanced hundreds of billions of dollars of debt last year, pushing back maturities and saving millions of dollars…

Rite Aid Corp

Rite Aid has $6.2 billion in debt, about half of it from its 2007 acquisition of the Brooks and Eckerd drug store chains, a move many analysts consider ill-timed at best.

The recession has battered Rite Aid's bottom line. The Cumberland County-based drug store chain lost $2.3 billion in its fiscal 2009 and $349.8 million through the first three quarters of its fiscal 2010.

When a company finances rapid expansion with debt, only to see per-store margins compress, "that becomes somewhat problematic," said Jeffrey Roof, president of Harrisburg-based fee-only investment management firm Roof Advisory Group Inc...

'Kick the can'

Clearly, it's beneficial for companies to save money by paying lower interest rates on their debt. However, the quantity and structure of the debt is important, Roof said. Excess debt is a problem, regardless of the interest rate, he said.

"A company that's highly leveraged doesn't necessarily have the flexibility to deal with stressful times," he said.

A January report on debt refinancing by Moody's Investors Service warned that many companies issuing speculative-grade debt are merely postponing problems, not solving them.

"We believe total debt levels were not meaningfully reduced, but that companies merely "kicked the can,' " the report said.

About $690 billion of speculative-grade corporate debt comes due over the next five years, Moody's said.

The economy and financial markets have probably recovered enough to absorb that total in stride, but that depends on there being no new downturn, Moody's said.

In addition, swelling federal, state and government debt presents a possible threat, the firm said.

"Even though governments and financial institutions typically have a different investor profile, the credit markets have proven to be highly sensitive over the last few years to shocks in other financial markets due to the increased risk of contagion," Moody's said…

Investment advisors bullish on '11
Local finance experts predict more strong stocks in new year
Friday January 7, 2011

Tim Stuhldreher

…Investors who haven’t yet done so should shift their portfolios more toward stocks, said Jeffrey Roof, president of Roof Advisory Group Inc. Corporate profits were high in 2010, and many companies are expected to increase dividends. And even if that were not the case, it’s a good idea to reduce bond exposure, Roof said. Returns are lackluster, and investors risk losing money if inflation ticks up even a little…

…The tax plan will add an estimated $858 billion to the federal deficit. That increases long-term concerns about U.S. fiscal health, but won’t hurt the economy over the next two years or so, Roof said…

…Roof said energy stocks generally do well when interest rates rise. Financial stocks are due for a rebound, he added…

“We don’t see a commercial real estate bust occurring,” Roof said. Commercial real estate is a highly liquid market, and there are always investors “with dollars to put in play,” he said.

Roof stressed the importance of developing individualized investment plans for clients that take into account their individual goals, circumstances and risk tolerance. Such plans, reviewed regularly, can keep clients from overreacting to the kinds of economic scare stories that have been all too prevalent these past few years…

Economic recovery expected in 2011
Saturday January 1, 2011

Jason Scott


... But conditions are improving. Consumer confidence seems to be picking up, as is evident by the boost in holiday consumer spending this past year. "More and more consumers are comfortable with spending dollars," said Jeffrey Roof of Roof Advisory Group, an investment management and financial planning firm from Harrisburg.

Some of that is just pent-up demand that's been out there, he said. Many have been conservative about their spending over the past couple of years because of fears of what might be around the corner. "You get to a certain point where people just need or want to replace things," Roof said.

That has translated into positive corporate earnings. Instead of expense reductions accounting for gains, which was the case in the early part of 2010, companies are now seeing growth again on the top end, he noted. There are more sales and revenue is starting to flow in. "That's important for the economy as a whole. It's a good sign that economy is rounding the bend," Roof said.

So rather than continuing to trim at the bone, employers will likely start to spend again on capital projects and new workers. "Jobs are being added," Roof said, also noting that initial unemployment claims continue to fall, which means other jobs aren't being lost.

The appetite for risk is also coming back to the investors, he added. "People are no longer satisfied with just protecting. They want to earn something," he said, with stocks starting to appreciate again.

With all of the uncertainty in recent years, a lot of capital has been sitting in cash. As consumers start to need a home and investors look at equities, the demand and prices will go up, Roof said. "Hopefully 2011 will be the year where many more say they feel like we're actually our of it." he added. "I think 2010 saw individual investors and business looking over their shoulders and saying, 'What's next?' You can't move forward if you're always concerned about the potential impact."

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