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Resources / Education

Pass Over

  It ‘tis the season…no, not that one, the other one.  Therefore, let’s talk about a little history but do so from the financial side vs. the religious one. We’ve said over and over to you that markets go up and down. That motion is volatility.  It is NOT risk, as conventionally defined.  If a particular investment that an investor was holding goes to zero and all your money was in it, that’s a true definition of risk.  Of…

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Winning the War

  As the old adage goes, too many people focus on trying to win the battle.  What is far more important is winning the war. The above is a lesson that comes out of many military books and well-worn paths of wisdom.  It applies equally to the work of investments.  We want to talk about it here as it relates to annual investment returns. The outcome is as important as any military engagement and, in this case, the side…

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Obligation

In this age of confusion about what is happening in the world, and the uncertainty of it, we thought it might be helpful to address one item that is certain; our legal obligation with you. The topic we’re addressing is one of trust, a very sensitive and important subject.  Trust happens in many areas of one’s life, but we would argue being able to trust someone with your financial matters is one of the more significant.  Beyond the survey we…

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Cycles and Sickles

  In addition to wishing you a Happy New Year, we want to talk here about doing smart things on your account. Everyone wants their portfolio to go up.  That part of our job description is simply enumerating fair expectations on your behalf.  Because we are Registered Investment Advisor under the Investment Act of 1940, our fiduciary duty to you is to act solely in your best interest to determine the best way to deliver on that expectation.  That’s our deal,…

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Emotions and Markets

‘Tis the season and, as you know, emotions run high at this time of year.   Unless we control them, these emotions can hurt us on either side.  Excessive happiness leads to potentially overbuying (and January financial hangovers).  For certain others the euphoria of the Holidays leads to their sense of being ‘left out of it’ and depression is prevalent.  The stock market also has emotions but, unfortunately, it is not limited to any certain calendars.  It would be helpful…

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Interest(ing) Times

  In these days of lower or at least sub-optimal, economic growth around the world, there is a concerted attempt to ‘juice the demand’ by keeping interest rates low.  You know this of course, given the great deal of press the topic has been given (Quantitative Easing #3 tampering off here in the USA, Japan’s grand economic stimulus of the same means recently announced).  Notwithstanding how prescient those moves sound, this correspondence will cover some lesser known intended by-product…

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The Value of a Company

  The value of all the publicly traded companies in this country is called, in industry terms, our ‘total market capitalization’.  Currently, that number is $23,634,700,000,000 ($23 trillion).  I think you would agree that’s a pretty sizable figure, so we’re going to talk about it here to elucidate a point. First, how you derive that number is quite easy.  You take (a) all the shares that owners of any one company possess, and (b) you multiply those individual shares…

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Where Fools Go

The potentially greatest single good the financial services industry could do for its clients is to make the critical distinction between ‘volatility’ and ‘risk’.  However, knowing this industry, we are not holding our breath that any offer of such education will be forthcoming soon. Whatever the level  Dow Jones may be at the moment you read this email, we have every reason to know that volatility is the onset of a temporary decline – which happens all the time…

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Variety, the spice of Life

This letter’s emphasis is on the places you own companies.  I can tell you the great variety of countries playing in Brazil at the World Cup soccer games has got nothing on you. First, the context of these remarks is simply around diversification of investments; as you innately are aware, not having all your eggs in one basket is smart.  It is simply unwise to concentrate your investments in any one country, much less company.  For those who were…

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Best Practices

  There are two things we’ll cover in this article, and we think their answers will surprise you; With the stock market up dramatically, what is the underlying nature of ‘stock market highs’? Are investments the most important thing? On the initial topic, what is unknown by most is that since 1926, the Dow Jones Industrial Average has reached ‘an all-time high’ every 18 days.  It is true that we saw the US market up roughly 16% in 2012…

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