We received great feedback on the articles we circulated earlier in the week, so we wanted to follow up with some more!
Here are five more pieces that additional team members have read, along with some commentary on why they found the respective articles interesting. Like the last set of articles, we’ve included pieces related to economics, investments, current events, and behavioral finance.
This article resonated with me because it isolates the biggest challenge we face as investors – ourselves. In this article, financial psychologist Dr. Brad Klontz provides helpful tips for managing your emotions during periods of volatility. “Go ahead and panic, but don’t panic about the fact that you’re panicking.” In other words, acknowledge your emotions, but don’t act on them.
While the media often tends to describe how people make fortunes from flashy investments, this article grabbed my attention as it shows the other side of the coin – how investors can fail. One significant point in this piece is that investors don’t save enough for taxes. It’s important to keep in mind the taxes you’ll owe from both portfolio and non-portfolio activity. I also enjoyed the point regarding the importance of reducing concentration risk. As the article says, “Concentration to get rich, but diversification to stay rich.”
There has been a lot of discussion about budget reconciliation and Build Back Better legislation in the past year. Many ways the administration looked to pay for the programs included modifications to retirement plan options such as Roth, Roth Conversions, and Back Door Roth contribution strategies. With many of those plans on hold and the budget ready for approval, some retirement plan changes are on hold. I enjoyed reading this overview of some of the things in the works.
It was relatively easy to be a stock market investor last year. Now amid volatility and geopolitical uncertainty, this article reminds us that we ‘won’t get equity-like returns with less than equity-like volatility.’ I like this article because it is a good reminder that we may not be able to control the news cycle or the markets, but we can control how we prepare our portfolios and how we plan to react to long-term investing success.
This article is more about human psychology than the markets, but I think it draws many parallels. Whether it’s inflation, sluggish market performance, or rising interest rates – they have all one thing in common: we can’t control them. Why do we think about these items if history has shown us that ‘this too shall pass’? Keeping a long-term mindset helps shape positive investing and daily life perspectives.
Conclusion:
Hopefully, these articles provide some insightful (and enjoyable!) weekend reading. We look forward to sharing more articles periodically throughout the year. In the meantime, as we mentioned earlier this week, if you’d like to discuss how the topics in these pieces may apply to your own portfolio, please do not hesitate to reach out to a member of our team.
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SWP Principal Mike Karmin doesn’t know whether or not the economy is heading for a recession in 2023. He does, though, feel strongly that investors should maintain their allocation to the stock market regardless of whether they believe that the Federal Reserve can successfully execute a soft landing.
In this short video, Mike shares some historical data that supports long-term investment in equities, even if a recession does come to fruition.
As we start the new year, especially after a challenging 2022, the most frequent question we are asked is: What is your prediction for 2023?
Admittedly, our crystal ball is cloudy. It always has been and always will be when it comes to short-term predictions. Still, there is no shortage of “experts” – supported by research, sophisticated models, and persuasive reasoning – that routinely broadcast what’s in store for the next twelve months. The harsh reality: it’s fool’s gold – entertaining but rarely actionable.
As you are likely aware, ongoing volatility and rising interest rates made 2022 a very challenging year in the capital markets. We believe that this past year has highlighted the need for advisors to explore investment opportunities that exist beyond the traditional stock and bond markets.
The private markets are one such opportunity set. In this article, we discuss what the private markets are, how these investments may fit into a diversified portfolio, and how we use them.
