What the reports show

Every quarter we review our clients’ quarterly reporting packages before we mail them.  These reports provide a significant amount of information. And some very important lessons can be learned from this data.

Growth of assets over time

It is very gratifying for us to review the growth in client accounts over time. Each tells a unique but similar story. The most important lesson is that owning a globally diversified portfolio of asset class funds, with an appropriate stock allocation, has grown significantly over the past 5-10-12 years.

Due to SEC rules, we are not permitted to advertise investment performance results. That is not my intention at all in this essay. My intention is to provide important lessons of what we have experienced, for real people in real accounts, but in a general manner.

Gains and losses can come quickly and unexpectedly. This year has been a very good example of these occurrences. In the most recent quarterly report, for clients invested during the entire third quarter, most of the gains were reaped in the first two weeks of July. Earlier in the year, losses were sudden in early January (due to Japan concerns) and in late June, after the Brexit vote. However, both of those losing periods were recouped within a fast time.

It is nearly impossible to time the stock market, because you have to be consistently right twice, every time you would attempt this. You would have to consistently try to get out before a down period and then be accurate to know when to get back in the market. All of my readings, observations of experts and these client reports show that it pays to remain invested for the very long term.

This is why it is so crucial to have the emotional strength and confidence to stick with your stock market portfolio, despite world events and all the concerns you may have.

We started this financial advisory firm in mid-2003. Since that time, global stock markets have increased significantly. The S & P 500 has increased from 1,132 on December 31, 2003 to 2,130 as of September 30, 2016. The DJIA increased from 10,453 to 19,308 over the same time period.

During this same time period, we have faced global terrorism, the financial crisis of 2008-09 and the real estate meltdown, Hurricane Katrina and many other natural disasters, Greek financial bailout, oil price collapse, Ebola outbreak, Brexit, global refugee crisis, Republican and Democratic presidents and vast healthcare changes. Yet, we as a society and financially, have survived and thrived despite all these challenges.

As it relates to your long-term investment portfolio, you should ignore the current political events. You should ignore whether and by how much the Federal Reserve will increase interest rates. Focusing on these types of things will not improve your investment results.

Over the long-term, which we consider to be 5-10 or more years, these near term events do not matter, because companies, people and countries continue to adapt, evolve and prosper. By investing in the manner that we do, in globally diversified stock portfolios, you will benefit over the long-term.

Our role is to develop a portfolio which is appropriate for you, for your timeframe, goals and your ability to handle risk and volatility. We are here for you when the markets are turbulent and investing is hard. It is during those time periods, when the markets are down and the world appears scary, that our guidance will provide you with the strength needed to maintain your diversified portfolio, so you can reap the rewards of long-term investing.







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