At Financial Plan, we are analytical to a fault when evaluating investments. We continually ask the question: “Are we populating our accounts with optimal securities, or are there other selections that are clearly better?” We might define “better” as wholly subscribing to our investment philosophy while demonstrating improvement to the items we can control; including […]
This time IS different
You’ve seen the declaration splashed across headlines, “This time is different!” Public perception surrounding the first half of this year and predicting the next has been grim. Pundits espouse that these events have “never been seen”, they are “once in a lifetime,” “a perfect storm”. The crazy thing is, they’re right. Whether it is the […]
Negativity Bias and the Financial Markets
Heard any bad financial news lately? Of course you have! But what if I told you the U.S. stock market recently enjoyed its best 50-day rally on record, ever? If you missed the positive financial news, it might be because your brain is tricking you into being pessimistic. Over the past decade, a wealth of […]
The Impact of the Coronavirus on the Stock Market and Your Financial Portfolio
As the coronavirus continues its trek around the world, speculation about the virus’s impact on the global stock market has been equally rampant. Those asking whether they should get more conservative with their financial investments or pull out of the market altogether are not wrong to assume that the coronavirus will impact the stock market. […]
The Recession is Coming! The Recession is Coming!
How to Recession-Proof Your Stocks (and Financial Plan) No doubt you’ve been hearing it a lot lately: “A recession is coming!” How do we know? Online search volume for the word “recession” is exploding, increasing by over 5x between July and August this year. Searches for “recession-proof stocks” quadrupled during this same time period. Clearly, […]
Stock Market Performance: A Case for Diversified Portfolios
If you have been paying attention, you know how much we believe in equity markets. Our clients who have a long enough time horizon and the risk tolerance to endure bear markets are invested, at least to some degree, in massively diversified portfolios of stocks. A reason we recommend portfolio diversification is because most individual […]
Is the Inverted Yield Curve Reason to Worry?
If you’ve been paying attention to investment news, you might be aware of the recent consternation that the “yield curve” in financial bond markets has “inverted.” (If you’re not, or aren’t entirely sure what this means, read on.) For some, the takeaway from this is immediate: if you believe in the ability of sporadic market […]
Getting to the Point of a Point
Recently, I ran across this article from Dimensional Fund Advisors. It contains insight into the difference between a price-weighted index like the Dow Jones Industrial Average (DJIA), and a cap-weighted index like the S&P 500. It puts into perspective the large swings in the DJIA, and highlights the limitations when comparing a portfolio to an […]
Let the Dogs Bark
The term “expected return” is in wide use among financial planners. To the layman it carries misleading connotations: most assume that it carries with it a high degree of confidence. After all, we are “expecting” a certain rate of return, aren’t we? Actually…no. Let’s explain: The expected return is a measure of the center of […]
How Long-Term Investment Strategies can Mitigate your Ticker Risk
What is ticker risk? Don’t bother searching the internet as this is simply a term we occasionally use to describe the inherent risks that come with giving too much credence to the current price and daily changes of the S&P 500, Dow 30, and Nasdaq Composite Index. These three, main “tickers” represent the vast majority […]