Rate Fears And Your Fixed Income Strategy

What a difference a decade makes.  It’s hard to believe it’s been approximately ten years since the “Great Recession” began. By year-end 2008, the U.S. Federal Reserve (the Fed) had lowered the target federal funds rate to near-zero and went on an aggressive easing campaign, hoping to resuscitate the economy with a booster shot of lending, borrowing and spending dollars.

Some would say the economic recovery that followed was a result of these Fed initiatives. More likely, there were a number of contributing factors including technology and innovation. Either way, the Fed has begun to reverse course, restoring its policies and targets closer to historical “norms” through quantitative tightening and gradually rising rates.

 

 

Here’s the $64,000 question: as an investor, what can or should you do to prepare if rates do continue to rise? For that matter, what can or should you do if they don’t? As usual, our advice may not be as action-packed as you might crave, but there are a number of solid, evidence-based strategies that stand the test of time.  > SEE MORE

Waypoint Wealth Management

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Waypoint Wealth Management

Thinking Differently About Investing

I can remember having that “light bulb moment” early in my career.  It was the late 90’s, and I was eager to find out what the “secret sauce” was that gave investors an edge.  I can remember analyzing the past performance of many, many money managers and continually discovering a common theme.  Those managers with better long-term track records proudly admitted that they paid less attention to shorter time frames.  They didn’t care what the stock market was going to do in any one, three, or even five year period.  Those who ended up with better returns than most of the other managers cared more about holding onto the stocks of businesses for longer periods of time and didn’t allow short-term volatility to get under their skin.

 

 

This is how it began to dawn on me: maybe it wasn’t important to try and figure out what the market was going to do, in order to be a successful investor.   > SEE MORE

Pete Dixon, CFP®

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Pete Dixon, CFP®

Partner and Advisor

Your Retirement Plan Doesn’t Care About January

Have you heard of the “January Indicator” or “January Barometer?” This theory suggests that the price movement of the S&P 500 during the month of January may signal whether that index will rise or fall during the remainder of the year. In other words, if the return of the S&P 500 in January is negative, this would supposedly foreshadow a fall for the stock market for the remainder of the year, and vice versa if returns in January are positive.

 

I’ve heard this for years.  And I can remember early on in my career probably giving it too much attention.  After all, the financial news loves soundbites, and this was one that could grab viewer’s attention as we wonder about the upcoming year.  But what does the evidence show us? Have past Januarys’ S&P 500 returns been a reliable indicator for what the rest of the year has in store?  More importantly, should we care or worry about it? > SEE MORE

Waypoint Wealth Management

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Waypoint Wealth Management

Our Brain And Our Behavior, Part Three

Do you ever do something based on a recent experience, even though you know it might not be the best choice? Or do you ever think to yourself “you know, I’m a better driver than most”?  How about watching the market’s movements and subtly measuring your diversified portfolio’s recent returns against a very narrow comparison such as the general market? If you’re like most of us and answered yes to any of these, we’re going to explore how these behaviors can potentially take us off track when it comes to our finances.

 

This is the final article in our three-part series, where we’ve been exploring the most common ways that our brains can be wired to help us in life—but also can hurt us as investors.  > SEE MORE

Waypoint Wealth Management

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Waypoint Wealth Management

Are You Prepared For The Next Correction?

If you enjoy a good read, we’d recommend Warren Buffett’s annual Berkshire Hathaway shareholder letters. While financial reports are rarely much fun, Buffett’s way with words never ceases to impress. His most recent 2016 letter was no exception, including this powerful insight about market downturns:

“During such scary periods, you should never forget two things: First, widespread fear is your friend as an investor, because it serves up bargain purchases. Second, personal fear is your enemy.”

This actually is a good time to talk about scary markets, since we haven’t experienced a severe one in a while.

 

 

> SEE MORE

Waypoint Wealth Management

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Waypoint Wealth Management