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When evaluating an investment portfolio, most people tend to focus on the return it provides. This is certainly understandable, as it is fairly intuitive. “I put in $100; it’s now worth $110. Therefore, my return is 10%.” However, this leaves out a key part of the overall story – taxes.

Broadly speaking, from the standpoint of most investment and tax professionals, investments can generally be classified as either “tax-efficient” or “tax-inefficient.” I’ll loosely define these terms as follows:

Interest rates and your portfolio are interconnected. This relationship creates market behavior that affects investors and borrowers alike and is often reflected in shifts within the economy. Understanding how they…

One central truth of investing is that it inherently involves risk—investments might result in losing some or even all of the money invested. However, the returns we enjoy from investing…

In the ever-evolving landscape of investments, a significant trend is reshaping how wealth is grown and managed: private asset managers are increasingly opening their doors to high-net-worth and retail investors….

l have written in the past about how I am a long-term investor. While past performance does not guarantee future results, I always keep in mind historical data to help…

The world has become captivated by instant gratification. Smartphone apps, TV and movie streaming on demand, same-day delivery services – the speed of obtaining immediate reward has become an obsession….

In today’s fast-paced world, it’s easy to get caught up in the noise of predictions, forecasts, and market speculation. It’s tempting to listen and react to predictions, but successful investing and sound financial planning involve tuning out the noise and taking a more disciplined, strategic approach.

Investing takes nerve. There’s always a reason to “let things calm down,” “hold off for now,” “take profits,” or any other common quip we’ve all heard. We do know that long-term, diversified investing leads to positive outcomes in almost every circumstance.  Despite that, human nature leads us to make emotional choices affected by outside influences.  There are times when these emotions seem especially heightened.  This year promises to be one of those years. 

Background: How We Got Here

In late 2008, the Federal Reserve (the Fed) cut the Fed funds rate – the target interest rate at which commercial banks borrow and lend their excess reserves to each other overnight – to 0% for the first time in history in response to the Global Financial Crisis.
Since cutting the Fed funds rate to 0% didn’t cause inflation to surpass the Fed’s 2% target (one of their dual mandates is price stability), the Fed maintained this accommodative policy (along with quantitative easing) for the next decade-plus as shown in the chart below.
Ultra-low interest rates from 2009 to 2021 paved the way for one of the longest economic recoveries in history; during this period, borrowing was cheap and therefore prevalent, and because credit investments offered meager returns, investors were encouraged to pursue higher-return (and higher-risk) investments such as stocks.