June 24, 2016

Markets Today and Your Portfolio

By now you have certainly heard the term Brexit.  If you hadn’t paid attention to the story over the past few months, it will be shoved down your throat now with the UK voting to leave the EU yesterday.  It is now impacting everyone with the effects being felt in the global stock markets.

I want to focus on what’s most important, how does this impact your financial life?

Back in March you may remember we began the process of rebalancing many of your accounts.  From January through mid-February the US stock market was down 10%.  By mid-march it had pretty much come back to square one.  Rebalancing means selling some positions and buying others.  We did all of the selling of those positions in March, but, very little of the buying.  The way we handle the buying and selling is to set a price we are willing buy or sell at, and try to be patient in letting the market move to that price.  Our feeling was that the markets will react to something that allowed us to buy in at those lower prices.  We certainly did not know that Brexit would be what presented the opportunity, just that ups and downs are how the markets work.

The result of this is, that in the discretionary accounts we manage for you, we have been holding much more cash than we typically would (this amount varies by account based on your specific risk tolerance).  We have had prices set to buy back into certain assets, today’s market movement will certainly bring us closer to some of those prices (and we very well may see some of the positions be bought).  We have also lowered a couple of the prices we set to buy into certain positions.

I want to be sure to emphasize that you still have a majority of your funds invested in stocks and bonds, so you will be along for the ride during this bumpy time.  The extra cash in the account should help balance the ride somewhat and present an opportunity to get it invested at prices lower than they were back in March (or even yesterday).  Things could certainly continue down from here (we’ve all been through that before – remember, stairs up and elevator down).  Stock markets hate uncertainty, and how the UK and EU will handle the impact of this change brings plenty of uncertainty.

I’ll let the talking heads debate just how big of an impact Brexit will have on the global economy.  We will remain focused on ensuring that you have the correct amount of risk in your portfolio, and that we are using opportunities of market volatility to rebalance back to that risk.

If you want to educate yourself more on Brexit here is a link to today’s WSJ article. 

If you have any questions, we are here. 

June 18, 2016

Elf Spotting, Financial Advisors & Fiduciaries

Thank you John Oliver for explaining the problems in the financial advice industry in a way that I never could (with a lot of swears and humor).


That bowl of soup explains better than I ever could exactly why we act as fiduciaries for our clients.

Oliver outlines the reality of the impact of fees (most of which are hidden).  This is exactly why we have moved to a flat fee model for our Personal CFO relationships.  We want you to know what you pay (in dollars) for the advice/guidance we provide.

He discussed the new Department of Labor ruling which I wrote about in a recent blog post.  Here are my ‘boring’ thoughts:


When the lobbyist for the big financial institutions are fighting this hard against a change, you know it is for a reason (hint: it probably isn't because they truly believe it is best for you).  The argument that the lower to middle income people will be hurt by this the most doesn't resonate with me.  The industry will, and should adapt, to pricing structures that work for a business model that supports providing advice to people while being held to a simple standard of it being in their best interest.

I love seeing these issues come to light.