Jong Oh • FSC Securities Corporation - Market philosophy: where active management begins by Linda Ferentchak - U.S. bull market "long-in-the-tooth" - or is it? - Technology enhances firm and client communications (Rich Ralston, WRP Investments, Inc.)

1. U.S. bull market:
“Long-in-the-tooth”? • pg. 7
Technology
Good for business • pg. 3
Market philosophy
drives active management
pg. 4
September 11, 2014 | Volume 3 | Issue 11
First magazine focused on active investment management
Jong Oh
Asset
protection
that leaves
a legacy
pg. 8

3. to customizing financial planning soft-
ware with enhanced client access. Small
things like eliminating steps in data
entry can add up to many hours saved
across our entire client base.
I plan to get more active with social
media, with compliant-friendly broad
Twitter messaging that can then be
tailored to our practice. There is also
a data-mining program to scan social
media ‘news’ of clients or prospects
to create timely CRM messaging. For
example, if the system alerts me that
Client X just announced a new grand-
child on Facebook, I will be able to
personally follow that up with an
email or phone call.”
think it is important to take
advantage of any edge that
technology can provide, especially with
younger clients who are tech-savvy.
This can cover virtually all areas of the
practice.
We completed a website redesign
and are using the developer’s sugges-
tions on how to move higher in local
Google rankings. I also partner with
a third-party endorser for prospect-
ing leads through an Internet-based
program. I use another provider for
market commentary for my newslet-
ter—pushed out electronically to cli-
ents and prospects. There are other rel-
atively simple technologies to use with
clients, like virtual meeting platforms
for presentations or webinars, or web-
based CRM that can integrate with
financial planning software. I have
started using the voice recognition
feature on my smartphone to record
quick notes right after client review
meetings.
Our broker/dealer, WRP Investments,
Inc., recently announced that they
would be combining forces with Sterne
Agee Financial Services, Inc. Working
together, they will have a very robust
technology group that can help with
everything from more streamlined port-
folio or strategy comparisons, to single
e-signatures for multiple documents,
Technology enhances firm
and client communications
Rich Ralston
Pensacola, FL
WRP Investments, Inc.
Parkway Financial Group
I“
Richard Ralston is a Registered Representative and Investment Advisor Representatives of, and offers securities and advisory services
through WRP Investments, Inc., member FINRA and SIPC. Securities and advisory services are supervised by WRP Investments, Inc. from
4407 Belmont Ave., Youngstown OH 44505, (330) 759-2023. Parkway Financial Group is not affiliated with WRP Investments, Inc.
Last week’s results
VIEWER RESPONSE
How have you found
employees in the last three
years?
Vote to see results
This week’s poll
What percentage of
Americans are interested
in receiving financial
advice?
Good old word-of-mouth is still how
most jobs are filled. More financial
advisors have found new employees
through referrals from outside sources
and other employees.
0% 0%0%
Referrals from
other employees
Through college placements
Internet advertising
Read text only
VOTE
20%
35%
50%
More than 65%
Referrals from
outside sources
LinkedIn
0%
100%
September 11, 2014 | proactiveadvisormagazine.com 3
TIPS & TOOLSPOLLS

4. Active management comes in different
varieties—from traditional market timing,
to dynamic asset allocation, core and satellite
strategies, absolute return, sector rotation
and as many variations on the theme as there
are ways to build an investment portfolio.
But ultimately, every approach starts with a
philosophy of how financial markets work.
How does the portfolio manager arrive
at his or her market philosophy? Like most
aspects of investing, there is no absolute
right or wrong approach. Active asset man-
agers have seen an explosion in computing
power over the past twenty years, affording
an unimagined level of sophistication in
modelling, backtesting, algorithms, and da-
ta-driven portfolio management. But active
management still must start with a “market
philosophy”—and a variety of “timeless”
analytical tools can be used to help managers
in strategy development consistent with that
philosophy.
Read text only
Market Philosophy
Where active management begins
How do you get there
from here? 10 analytical
approaches to the
investment decision.
By Linda Ferentchak
proactiveadvisormagazine.com | September 11, 20144

5. Here is a look at ten broad analytical
approaches that underlie much of active
management:
(1) Fundamental approaches have a fore-
casting aspect and look at valuation measures,
earnings growth, dividend projections, market
opportunities and more to identify sectors, geo-
graphic markets, or individual securities that
can be expected to increase in value, preferably
faster than the market as a whole. A fundamen-
tal approach may also consider the economic
or business cycle to assess which asset classes or
sectors will benefit from current and upcoming
market conditions. When active managers use
fundamental analysis, it is typically blended
with market data-based tools.
(2) Pattern recognition is among the oldest of
the active investment approaches and includes
charting techniques such as candlesticks, head
and shoulders formations, multiple bottoms,
and price support and resistance. Data analysis
is used largely to identify patterns today, but
there remains an art to successful pattern rec-
ognition. Financial markets don’t always play
out the same way or in the same time frame.
Nevertheless, there are investment managers
who have been and are extremely successful
with this approach. (see Chart A)
(3) Trend following uses tools, such as
moving averages, to determine when a market
or market segment is in an up or down trend
to position assets accordingly. This approach
tends to work best when the market is making
a sustained directional move and falters in
“trading range” markets. Buy and sell signals
also frequently lag market tops and bottoms,
making the approach vulnerable to whipsaws.
The Golden Cross, when a short-term moving
average crosses a long-term moving average, is a
classic trend-following indicator. (see Chart B)
to have high relative strength rankings before
major price moves. Investments with failing
relative strength indicate weakening prices and
time to move on. This approach is very differ-
ent than one that espouses buying “dips” when
prices are falling.
(5) Momentum investing targets investments
that are gaining in value faster than competing
investments. Chicago money manager Richard
Driehaus, widely considered the father of
momentum investing, maintained “far more
money is made buying high and selling at even
higher prices.” Buying stocks simply because
they have risen in price may seem simplistic,
but numerous academic studies have shown
that it can work very effectively. Momentum
analysis is also used to identify whether a sector,
index, asset class, or geographic market is in a
buy or sell mode.
(6) Overextended/mean reversion analysis
strives to determine the difference between
normal and “extreme” behavior, i.e. when
investors overreact to market information,
creating a “bubble” effect. These strategies are
based on mean reversion—the tendency of
financial markets and investments to return to
average values. Typically considered contrarian
investment approaches, overextended strategies
require taking positions that conflict with the
current market mood or direction. They are
vulnerable to being too early in entering or
exiting market moves and tend to have their
greatest effectiveness in trading range markets.
(7) Behavioral finance is a relatively new
field that seeks to anticipate market direction
by understanding why and how people make
financial decisions. Crowd psychology and
sentiment-tracking play a strong role in this
continue on pg. 11
Active asset managers have seen
an explosion in computing power
over the past twenty years, affording
an unimagined level of sophistication.
Daily
Daily
SMA (50)
SMA (100)
Chart A: AT&T Double Bottom in February-March, 2014. Two prices testing the same level may indicate a
stock or index has reached either a top or bottom.
Chart B: AT&T Golden Cross in April 2014, where the 50-day SMA crosses the 100-day SMA.
(4) Relative strength investment approaches
strive to target market leaders by comparing the
percentage change in price for a sector or secu-
rity over a set number of market days to other
investment options. Short-, intermediate- and
long-term rankings may be used. Leaders tend
September 11, 2014 | proactiveadvisormagazine.com 5

7. 5000
4000
3000
2000
1000
-1000
0
1928 2014Bull/Bear Markets Since 1928
Length(Days)ofBull/BearMarkets
Bull Market Modern Market ReferenceBear Market
U.S. bull market “long-in-the-tooth”—or is it?
ot only has the S&P 500 closed
above the 2000 mark for the first
time recently, the U.S. equity
bull market has exceeded its 2000th day.
The current bull market now ranks 4th in
terms of length (as well as strength) and,
with a gain approaching 200% at the end
of last week (9/5), is just about double the
average bull market gain of 105.3%.
Bull and bear markets are determined
by a 20% gain or fall in price. For that
reason, many count the current bull market
as starting March 9, 2009. However, this
N
Source: Bespoke Investment Group
point of view discounts the fact that in
2011 the broad S&P 500 Index did fall
19.4% from market close to market close,
and on an intraday high to intraday low
basis the decline was 21.6%. So, if one
counts the age of the bull rally from the
October 3, 2011 bottom instead of 2009,
the current bull market is only 1067 days
old. Rather than ranking 4th in longevity,
it would only rank 9th.
No matter which date one settles on for
the current bull, it is a fact that the typical
bull/bear market cycle has lengthened
over time, as seen in the chart below.
Bespoke Investment Group observes,
“Early on for the S&P, when the U.S. was
still a developing country, bull and bear
markets occurred much more frequently.
As the economy and therefore the market
has developed and matured, the bull/
bear market volatility has decreased
much in the same way a low-market cap
growth stock grows into a big blue-chip.”
(Note: the accompanying chart shows the
start date for the current bull as 2009.)
Read text only
LENGTH OF BULL AND BEAR MARKETS FOR THE S&P 500 SINCE 1928
7September 11, 2014 | proactiveadvisormagazine.com
TOPPING THE CHARTS

8. Jong Oh
Life Member, Million Dollar Round Table
Member, Ed Slott’s Elite IRA Advisor Group
BS, Biology, Eastern University
Married and mother to four children
Read text only
Jong Oh
Asset
protection
that leaves
a legacy
By David Wismer
Photography by Michael Branscom
8 proactiveadvisormagazine.com | September 11, 2014

9. Proactive Advisor Magazine:
What motivated you to get into the
advisory business?
Jong Oh: Originally from Korea, I attended
college here in the U.S. and have been a resi-
dent for over 40 years. I received a tremendous
opportunity to build my own business and I
want to pay that back to the Korean-American
community. Working as a financial advisor
allows me to do that.
How did your career progress?
After college, where I studied the sciences,
I decided to switch paths and entered the
insurance business. It was a natural thing over
time to evolve into a full financial planning and
investment advisory practice.
After a lot of hard work, licensing, and
training, I eventually started my own practice
in 2000 called Professional Insurance and
Financial Services. My kids think that is a
pretty corny name, but I think it reflects what
is important to me and my clients. I want to
provide top-notch and professional products
and services to all of my clients.
Can you tell me a little about your
client base?
My business is 99.9% based on referrals. My
clients come from all walks of life but there are
two main types. I have quite a few affluent pro-
fessionals, especially in the medical field, and
I have many small business owners of Korean
descent. But my practice is not limited in any
way and I welcome every client.
Is there a cultural distinction with your
Korean-American clients?
Yes, definitely. I can say that just about all of
my clients have sacrificed a lot to get where they
are today. It is part of the culture to want to
protect what you have and to leave a legacy for
your children and their children. Koreans tend
to be frugal and are very concerned with saving
what they have earned.
There are also some beliefs of older gen-
erations of Koreans that are old-fashioned,
but have to be dealt with. Some people are
superstitious about life insurance, thinking it is
bad luck. And many people grew up with a dis-
trust of trying to get advice from big financial
institutions, more due to the language barrier
than anything else. So a lot of people were used
to managing their own money, either through
investing in their businesses or just keeping it
in bank accounts or CDs. They also do not like
to owe anyone money, so paying off a mortgage
is very important.
Have those attitudes had an influence
on how you run your practice?
The biggest thing is to try and quickly es-
tablish a relationship built around trust. Using
another aspect of Korean culture, I tell clients
that I am like a matchmaker. I am trying to find
the best match between their dreams and vision
for the future and ways to make their wealth
grow. I also emphasize that one of my important
goals is to help them transfer their assets to the
next generation in a tax-efficient way. They can
relate to that.
How about in terms of your overall
investment philosophy?
That also plays into the cultural distinctions.
I am a conservative investor myself. But I have
always been open to learning about new meth-
ods and communicating those to my clients.
You cannot stay ahead of inflation by parking
your money in cash accounts and CDs. When I
learned more about active money management,
I became a convert.
A lot of my clients saw what traditional asset
management did to people’s investment accounts
in 2001 and 2008, even if they were not invested
in stocks themselves. They are fearful about the
markets—telling me that a return of zero is better
than a 30% loss of their assets. Having actively
risk-managed accounts is a way I can help them
overcome this fear.
Please explain.
How do I deal with market risk and my cli-
ents’ fear of the markets? That is my dilemma—
and active management provides the solution.
The world is changing fast and is so unpre-
dictable. The markets can be volatile, but we
need to find ways to beat inflation over the long-
term. An active money management approach
gives me the confidence that my clients’ money
is being watched over constantly by professionals
in ways that I could never do myself.
continue on pg. 10
“It is part of the culture
to want to protect what you
have and to leave a legacy
for your children and
their children.”
In a tightly knit community in suburban Philadelphia, three generations of Korean-Americans trust Jong Oh
to help them protect their assets.Leaving a legacy for their children and grandchildren requires hard work and
sacrifice—and managing investment risk.
September 11, 2014 | proactiveadvisormagazine.com 9

10. M U LT I - M A R K E T
+
MULTI-STRATEGY
+
MULTI-MANAGER
One p rtfolio
D Y N A M I C A L LY R I S K - M A N A G E D
L E A R N M O R E
Past performance does not guarantee future results.
The opportunity for profits
carries with it the possibility of losses.
800-347-3539 | flexibleplan.com
A complete list of all of our recommendations over the last 12 months and Brochure Form ADV Part 2A are available upon request.
When there are changes in market condi-
tions, third-party managers can use their process,
systems, and strategies to manage risk. And so my
goal, like that of my clients, is not to chase the
highest returns, but to provide returns that will
outperform the most conservative investments
over time. We want to leverage and compound
fairly slow and steady returns year after year. This
works well with the attitudes of the majority of
my clients.
How do you explain the concept of
active risk management to clients?
I evaluate each client’s risk profile and walk
them through the process. While we have some
sophisticated tools for that, it also has to be
broken down into real terms that can be easily
understood.
I will take their investable assets and literally
write down what a loss of 20, 30 or 40% might
mean to their portfolios in actual dollar terms.
I also explain how if one takes a 40% loss to a
portfolio, it takes far more than a 40% gain to
make it up.
Through this give and take, I can explain the
balance between risk and return, and the fact
that going for the highest returns with no risk
management might take them to a place they do
not want to be. The account actively managed
over many years should be a better choice—for
their comfort level and their returns, rather than
trying to ride out the highest highs and lowest
lows of pure market returns.
I also stress that the approach I use is very
well-diversified. With active management, we
are not just diversified with stocks, but with dif-
ferent asset classes and strategies both in equities
and within asset classes.
Overall, while it takes some explanation, this
is an investment approach that fits in very nicely
with the needs of my clients, though it is not the
only tool I use for managing assets. My clients are
not looking to take big chances with their assets,
their retirement, or their legacies. The focus of
active money management on controlling risk
and volatility works well for meeting the needs
of my clients.
continued from pg. 9
Jong Oh is a Financial Advisor with Professional Insurance &
Financial Services (PIFS) in Blue Bell, PA.
Securities and advisory services offered through FSC Securities
Corporation, member FINRA/SIPC. Insurance services offered
through PIFS, which is not affiliated with FSC Securities Corporation.
10 proactiveadvisormagazine.com | September 11, 2014

11. There can be no assurance that any investment product will achieve its investment objective(s). There are risks associated with investing, including the entire loss of principal invested. Investing involves market
risk. The investment return and principal value of any investment product will fluctuate with changes in market conditions. Guggenheim Investments represents the investment management businesses of Gug-
genheim Partners, LLC. Securities offered through Guggenheim Funds Distributors, LLC. Guggenheim Funds Distributors, LLC is affiliated with Guggenheim Partners, LLC. x0515 #12526
Uncover the True Cost of Trading Mutual Funds
and ETFs
The reflexive perception that ETFs cost less, simply based on their low expense
ratios, and are more cost-effective than mutual funds, is not entirely true. In
addition to an expense ratio, there are additional considerations that should
be considered when making an informed choice between ETFs and funds—
including spreads and commissions. This informative white paper from Rydex
Funds provides an in-depth look at the cost of ownership of no-transaction-fee
(NTF) mutual funds and ETFs—with a focus on active investing strategies.
Request your free copy.
Call 630.505.3749 or visit guggenheiminvestments.com/rydex
Chicago | New York City | Santa Monica
Rydex Funds
A Comparison of ETFs and
Mutual Funds—The True
Cost of Investing
approach. Behavioral finance approaches tend
to seek assets that are mispriced because of
irrational tendencies such as following crowds
or overreaction to market fluctuations.
(8) Seasonality is an approach to the market
that looks not at what the market is doing but
what day it is, or in the case of the Presidential
Cycle, which year of the president’s four-year
term it is. Hulbert Financial Digest maintained
in 2003 that the market timing system with
the best 20-year record, gaining 13.5% an-
nualized, was Norman Fosback’s Seasonality
Trading System. A variety of seasonal analytical
approaches can be employed depending on the
asset class.
(9) Cyclical models are based on the concept
that any data series is made up of many repet-
itive waves of varying length and amplitudes
acting simultaneously. Fourier Analysis and
Elliott Wave Theory are two examples. Elliott
Wave theory maintains that stock market trends
unfold in five waves, three upward pointing,
and minor waves that serve as intermediary
corrections. Once a five-wave move is finished
in one direction, the market makes a large-sized
move in the opposite direction that corrects the
entire prior sequence of five waves. Knowing
where the market is in the cycle, tells the inves-
tor when to go long and then sell or to short a
position.
Variations on the themes described above
and unique investment systems abound in the
financial industry, limited only by the variety
of ways individuals view the financial markets.
Active investment management strategies may
blend elements of many different analytical
approaches in a single strategy. There is also a
growing emphasis toward moving away from
a single all-in-one strategy to an approach,
instead, of allocating among analytical ap-
proaches based on which individual or blended
approaches are producing the best performance
in current market conditions.
Keep in mind that these are just some
of the basic tools used by active managers to
effectuate their market philosophy. Because the
investment field attracts some of the best and
brightest analytical minds, new and different
ways of looking at the financial markets are
continually emerging—all with the essential
mission of producing strategies with favorable
risk/reward relationships.
continued from pg. 5
Active investment management
strategies may blend elements of
many different analytical approaches
in a single strategy.
(10) Divergence indicators encompass a
broad range of market data from the ratio of
stocks advancing compared to stocks declining,
put call options, volatility, earnings projections,
and more with the objective of looking for when
these indicators diverge from their norms, given
the market’s current action. When the indicator
diverges from its typical pattern, it’s a flag to
look for confirmation in other indicators.
11September 11, 2014 | proactiveadvisormagazine.com

12. The opinions and forecasts expressed herein are those of the author and may not actually come to pass. Any opinions and viewpoints regarding the future of the markets should not be
construed as recommendations of any specific security nor specific investment advice. The analysis and information in this edition and on our website is for informational purposes only.
No part of the material presented in this edition or on our websites is intended as an investment recommendation or investment advice. Neither the information nor any opinion expressed
nor any portfolio constitutes a solicitation to purchase or sell securities or any investment program.
Editor
David Wismer
Associate Editor
Elizabeth Whitley
Contributing Writers
Linda Ferentchak
David Wismer
Graphic Designer
Travis Bramble
Contributing Photographer
Michael Branscom
September 11, 2014
Volume 3 | Issue 11
Proactive Advisor Magazine is
dedicated to promoting and educating
on active investment management.
Distribution reaches a wide audience
of financial professionals who advise
clients on investments and portfolio
management. Each issue features
an experienced investment advisor
who offers insights on active money
management, client service, and
investment approaches. Additionally,
Proactive Advisor Magazine offers
an up-close look at a topic with
current relevance to the field of
active management.
Advertising
proactiveadvisormagazine.com/advertising
Reprints
proactiveadvisormagazine.com/reprints
Contact
proactiveadvisormagazine.com/contact
Proactive Advisor Magazine
Copyright 2014 © Dynamic Performance
Publishing, Inc. All rights reserved.
Reproduction of printed form, whole or in
part, without permission is prohibited.
Performance nonsense: Why past performance
is a poor indicator and how to do better
An argument for avoiding the performance trap and showing responsibility
in managing risk to really protect the client’s portfolio.
How advisors can become thought leaders
Thought leadership is, unquestionably, one of the most
powerful and cost-effective business development strategies
for most financial professionals.
When “mean” means “nice” for stock bulls
Can the premium in stock earnings yields over Treasury rates persist?
Financial advisors have mixed
record with client 401(k)s
Americans with financial advisors typically make higher contributions
to 401(k) retirement plans and generally have clearer financial goals
than their peers—but many advisors need to do much more.
Warning to wealth managers:
“Don’t be creepy”
Advisors need to be careful with how they use advances in
data-mining for their messaging to prospects—especially
when it comes to personal data.
Why a market correction now would
be best scenario for bulls
Why a normal (and overdue) correction now, to cool off stock valuations
and investor euphoria, may help postpone the next bear market.
Stay connected
12
L NKS WEEK