Diworsification – Can You Take Diversification Too Far?
Key Takeaways: Diversification can be overdone – there is a point where adding another investment to your portfolio can be harmful to the risk/return profile The goal of portfolio diversification is to reduce volatility – owning assets that don’t always move in sync with one another. Naively attempting to diversify your portfolio by investing in […]
The Federal Reserve FINALLY Raises Rates
Key Takeaways: Last week, the Federal Reserve raised the Federal Funds Rate by 0.25%. The Federal Reserve is projecting several more rate increases in 2022. The Federal Reserve is confident in a strong US economy and the ability for the economy to withstand higher interest rates. Last week the Federal Reserve raised interest […]
Markets are Digesting a TON of Information
Over the last few months, market volatility has dramatically increased. The CBOE Volatility Index or VIX, created by the Chicago Board Options Exchange, is a real-time market index representing the market’s expectations for volatility over the coming 30 days. The VIX started the year at just over 17 and has already reached over 28 during […]
Top 10 Personal Finance Best Practices
As more investors seek out and embrace personalized asset management and individualized financial advice, industry tycoons Vanguard and Russell Investments researched the value created by professional advice. Both companies measured the impact on investor returns when partnering with an advisor who provides skilled management and guidance. Russell Investments identified up to an additional annualized […]
Behavioral Finance and Asset Allocation
Summary Points: We simply have to watch money flow to know how “average investors” behave. Investor emotions typically run opposite to sound decision making. Sound allocation planning can provide other positive impacts on your overall plan. An emotional investor is very likely to make poor decisions over his or her financial life. Various […]
Some Perspective on the Fed’s Latest Meeting
Key Takeaways With ongoing inflationary pressures and a continued decline in the unemployment rate, the Fed appears ready to pick up the pace of normalizing monetary policy. The Fed confirmed that at this point they plan to raise the fed funds rate at the March meeting but reiterated that the pace and frequency of rate […]
Managing a Household Allocation
One of our mantras in planning is to “Know What You Own.” Peter Lynch popularized this term during his management of a Fidelity mutual fund in the 1980’s, and we think it applies to more than just investments. Your home, your health insurance, your business, and yes, your investments each have features, risks, and opportunities […]
Tax Management in Bull Markets
How do we manage accounts when everything is up? With cooperative markets, many investors have accumulated substantial capital gains in their investment accounts. We analyze the trade-off between ideal allocation & paying tax to achieve it. In general, we advocate paying tax along the way to avoid over-concentration. When I was growing up, my granddad […]
The Economy’s Return to Normal
Key Takeaways: Economic data indicates a return to pre-pandemic levels of activity A tight labor market has contributed to some wage inflation Inflation, wages/jobs, supply chain issues will continue to be areas of interest As kids return to school, summer trips come to an end, and everyone starts to eye the holidays, investors and […]
Robinhood and a New Generation of Investors
Warren Buffett is one of the most famously successful investors of all time and his firm, Berkshire Hathaway, trades today near its all-time high, closing Friday at $433,124/share. Mr. Buffett has stated that he does not intend to split these original A shares as they attract like-minded, long-term investors. However, Berkshire did issue B shares […]
Interest Rates & Inflation
Over the past decade, the Federal Reserve has been pushing for modestly higher interest rates and inflation. To anyone following the markets or economic news, this statement is nothing new to hear. However, with higher inflation starting to build momentum, an economy that is beginning to stand on its own, and the potential of a US government […]
Thoughts on NFTs
We believe it is our responsibility to give our thoughts on current investment trends, even if it involves an asset that we do not currently invest in for our clients. Of all the “assets” we have detailed in previous commentaries, none are as esoteric as NFTs, or Non-fungible Tokens. I use quotation marks around the […]
