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The markets are down again today.
Ask yourself:
Will you be spending all your savings within the next year?
How about the next three years? Five?
Do you have an investment plan designed by a professional?
Is that plan based on your personal goals and financial situation?
You may want to find something (anything!?) else to watch other than the financial porn networks.
Hang in there.
August 17, 2018
The U.S. Business Cycle is Maturing
With the mostly sideways action in the markets this year, you may be thinking this is getting old, why are things so… foggy? Well, you’d be right, it is getting old. The business cycle, that is. It may be helpful to understand where we’re at in this cycle. So, here’s a sexy chart… {commence eye roll}
I believe the U.S. is advancing in its protracted shift toward the late-cycle phase (Exhibit).
The risk of U.
When designing an investment plan, it’s crazy important to understand the relationship between risk & reward. The goal is to take an appropriate level of risk for the desired potential return, and not an ounce more. Not an easy task.
Think about risk and reward this way: If you receive aninheritance, it took no risk on your part (other than the loss of your loved one, of course), yet you reaped great reward.
No amount of skill can be applied to playing the lottery that will affect the outcome. It is, after all, random.
Nor should one “play” the market expecting to get lucky. Even skill has limited affect on short-term results. However, over the long-term it’s the hard work of research, analysis, and the skill of applying insight that may impact your success.
They say half the battle is knowing what to ignore. They are right.
Of course, the other half is knowing what works.
Think of investing risk (in broad terms) as two yo-yos — one for stocks, the other for bonds. The stock yo-yo has a much longer string than the bond yo-yo, so that when you fling it down it comes precariously close to scuffing the ground. The string on the bond yo-yo, however, is so short it barely reaches your knee on the downswing.
This video provides some information about anticipated cost-savings for our client’s using our Morningstar Managed strategies…
The news headlines celebrating new record highs in the U.S. stock market have multiplied in last 10 months. While this upward momentum has been rewarding for many investors, the higher stock prices are accompanied by stretched valuations and risk of muted future returns — and even potential dramatic drawdowns. Let me explain…
