Would You Pay For Your Doctor’s Trip To The Bahamas?
What if you knew that your doctor was more highly trained to sell you a specific drug that paid him much more money than any other suggestions he could make for you, even if it wasn’t in your best interest? On top of that, what if you knew that this doctor had sales targets where his income would increase drastically for selling enough of this medicine each month? He could provide you with advice and receive his standard fee, or he could suggest that you take this drug and he would receive $70,000. In addition, if he sold enough of this in a certain time period, the drug company would send him and his family to an all-expense paid, posh trip to the Bahamas. Does he maintain his ongoing education as a doctor? Sure, he does—enough to maintain his license. But more of his training these days is put toward attracting ‘customers’ into his office to convince them to buy this drug. I mean, why wouldn’t he? The opportunity is to make millions more per year, so he’d prefer to hone his skills with talking you into buying more of this drug, and getting to know your friends and family so he can sell it to them too.
Here’s a question for you: would you work with this doctor?
You might say “of course not!” And I certainly wouldn’t either. But what if I told you that this is exactly what is going on in the investment industry? > SEE MORE
Posted by:
Pete Dixon, CFP®
Partner and Advisor
Rate Fears And Your Fixed Income Strategy
What a difference a decade makes. It’s hard to believe it’s been approximately ten years since the “Great Recession” began. By year-end 2008, the U.S. Federal Reserve (the Fed) had lowered the target federal funds rate to near-zero and went on an aggressive easing campaign, hoping to resuscitate the economy with a booster shot of lending, borrowing and spending dollars.
Some would say the economic recovery that followed was a result of these Fed initiatives. More likely, there were a number of contributing factors including technology and innovation. Either way, the Fed has begun to reverse course, restoring its policies and targets closer to historical “norms” through quantitative tightening and gradually rising rates.
Here’s the $64,000 question: as an investor, what can or should you do to prepare if rates do continue to rise? For that matter, what can or should you do if they don’t? As usual, our advice may not be as action-packed as you might crave, but there are a number of solid, evidence-based strategies that stand the test of time. > SEE MORE
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Waypoint Wealth Management
Thinking Differently About Investing
I can remember having that “light bulb moment” early in my career. It was the late 90’s, and I was eager to find out what the “secret sauce” was that gave investors an edge. I can remember analyzing the past performance of many, many money managers and continually discovering a common theme. Those managers with better long-term track records proudly admitted that they paid less attention to shorter time frames. They didn’t care what the stock market was going to do in any one, three, or even five year period. Those who ended up with better returns than most of the other managers cared more about holding onto the stocks of businesses for longer periods of time and didn’t allow short-term volatility to get under their skin.
This is how it began to dawn on me: maybe it wasn’t important to try and figure out what the market was going to do, in order to be a successful investor. > SEE MORE
Posted by:
Pete Dixon, CFP®
Partner and Advisor
Reminder: Headlines Are Framed to Frighten – Not Enlighten
If we’ve been doing our job as your fiduciary advisor, you might already be able to guess what our take is on the current market news: Unless your personal goals have changed, stay the course according to your personal plan.
Still, it never hurts to repeat this advice during periodic market downturns. We understand that thinking about scary markets isn’t the same as experiencing them.
So, what’s going on? Why have stock prices suddenly become volatile after such a long, lazy lull, with no obvious calamity to have set off the alarms? While we could point out fears of inflation, interest rate movements, and other potential reasons, we can’t (and no one can) know for sure what exactly moves markets on any given day, and this does not inform us of what will happen next. > SEE MORE
Posted by:
Waypoint Wealth Management
Your Retirement Plan Doesn’t Care About January
Have you heard of the “January Indicator” or “January Barometer?” This theory suggests that the price movement of the S&P 500 during the month of January may signal whether that index will rise or fall during the remainder of the year. In other words, if the return of the S&P 500 in January is negative, this would supposedly foreshadow a fall for the stock market for the remainder of the year, and vice versa if returns in January are positive.
I’ve heard this for years. And I can remember early on in my career probably giving it too much attention. After all, the financial news loves soundbites, and this was one that could grab viewer’s attention as we wonder about the upcoming year. But what does the evidence show us? Have past Januarys’ S&P 500 returns been a reliable indicator for what the rest of the year has in store? More importantly, should we care or worry about it? > SEE MORE
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