Which Path Would You Take?

“I don’t know…something just doesn’t feel right,” you mumble through your mask to your primary care doctor while sitting on the examination table under a flickering fluorescent light in a room decorated with anatomical charts and hand-sanitizer dispensers. After listening to your heart and your lungs, the doctor diagnoses your feelings of worry as a mild condition that is easily treatable but could become serious if a proper treatment regimen isn’t followed. The doctor gives two treatment plans: one coming from the New England Journal of Medicine and the other from a health magazine that can be purchased at your local convenience store. Which plan do you choose?

 

The health magazines are filled with tips and tricks, such as how to burn body fat, jump-start the body’s metabolic rate, and build immune system strength. And they might even work sometimes. If you want to choose the treatment plan with the highest odds of success, it might give you more confidence to know that the medical journal, and its recommendations, are based on decades of data collected from research studies performed by medical experts and peer-reviewed by the medical community.

We face the same decision when it comes to investing. > SEE MORE

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How Can “Sequence of Return” Help or Harm You?

Clearly, there is a lot to think about when planning for retirement. While we have a degree of control over many of the choices involved, there’s one big wild card called sequence risk.

Sequence risk is the risk that you’ll encounter negative investment returns in early retirement. This is an important consideration, because the random sequence – or order – in which you earn your returns early in retirement can have a significant impact on your lasting wealth. Simply put, a retirement portfolio that happens to experience positive returns early in retirement has a better chance to outlast an identical portfolio that must endure negative returns early in retirement (if withdrawal amounts are not adjusted) … even if their long-term rates of return end up the same.

Since nobody can predict which return sequence they’ll experience early in their retirement, every family should prepare for a range of possibilities with their retirement planning. > SEE MORE

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A Calm Reflection On The Markets

Many of you may prefer to tune out the financial news, and you may not need much reassurance when we experience bear markets.  But the biggest worry that we have is that a client is worried; if that is the case with you please don’t hesitate to call to go over your investment plan.

The most common question we get during times like these is: “your phone must be ringing off the hook.”  The truth is, that it is not.  That doesn’t mean that we’re less busy in times like these.  But we do think the quiet is a testament to not only the planning we’ve done and (hopefully) the perspective we’ve provided you, but also that you’ve placed your trust in us.  So thank you for that trust—we don’t take it lightly—and we really mean that we are here for you if you want to call or set up an appointment.

So, another long bull market has come to an end (for now).  This happens when a market declines by 20% from its recent high watermark.  And, while we tend to focus on the negative aspect (the -20% or more), which we completely understand, we recently came upon the following picture that shows in detail the length and scale of ALL the previous bull markets (and bear markets).  What is very evident, is that over time the blue/positive/upturn/bull markets dominate the red/negative/downturn/bear markets.

You can click on the following link to see a larger version of this image: Market Declines and Volatility

 

 

This, of course, doesn’t mean that downturns are any less difficult when we’re experiencing them.  But sometimes visual evidence can help a long-term investor (like you) remember why we invest in the first place.  The positive growth outlasts the negative (every time so far) and the net outcome is expected growth.  We don’t know when the next upturn will begin.  But staying invested means that we’ll be there when it does.

 

 

Past performance is no guarantee of future results. Indices are not available for direct investment; therefore, their performance does not reflect the expenses associated with the management of an actual portfolio.

 

Waypoint Wealth Management

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Waypoint Wealth Management

Factoring In “Intuition”

When we’re discussing our investment philosophy, we love to hear questions that open up more around why we invest the way we do. Because the reality is that most individual investors don’t really even have an investment philosophy beyond trying to get the best return.

Occasionally during these conversations, we talk about how we pursue “factors” of return that are persistent, pervasive, robust, implementable and intuitive. We wanted to briefly cover what these mean, and especially the one labeled “intuitive”.  How could intuition have anything to do with an investment philosophy?

 

First off, how do we define what we mean by a “factor” of return? > SEE MORE

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You (Get To) Choose Which Game To Play

We hope that you and yours are doing well as we swing into the holiday season. In a world both wondrous and sometimes weird, you may have mixed emotions about the days, months, and the new year ahead of us – an intermingling of fear and optimism, hope and hesitation, possibly even sorrow and joy.  And you may have noticed that the markets have been swinging through every one of these same emotions as well, in real, seemingly manic time.

For capital markets, that’s perfectly alright. In fact, it’s precisely what they’re supposed to be doing. Out of the seeming chaos, an efficient method arises for setting and re-setting relatively fair pricing. It’s exactly how tens of millions of trades occur every day, at lightning speed, around the world. If prices instead grew sluggish or stagnant, so too would our ability to make money in the markets.

That said, while apparent mayhem may make perfect sense for moving markets, it’s not how you need to live when thinking about your portfolio. As an individual investor, you get to choose which game to play. > SEE MORE

Waypoint Wealth Management

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