AWM Insights Financial and Investment News

Diversification is a key pillar of financial success. 

Owning as many companies as you possibly can position your portfolio to pick up returns from generational performers, and increases your odds of not missing out on these best-in-class companies.

This concept makes its way into Global Markets as well. Maintaining exposure to different economies and regions with different industries increases your odds of success, and potentially can smooth out yearly returns.

The old adage of not putting all your eggs in one basket holds true here and usually leads to you having more eggs at the end of the day. 

Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network.

Episode Highlights

• 0:00 Intro
• 1:35 What do we look for while conducting research?
• 3:33 What is Global Market Capitalization and why do we use it as a starting point? 
• 4:30 Diversification and why we still invest internationally during times of unrest.
• 5:58 Why do we use confidence in outcomes over any single arbitrary figure? 
• 6:45 Why are we slightly overweight Domestic Companies and have a home bias? 
• 7:56 What do active managers think about their funds and how do they invest their own money?
• 9:31 Pros of Passive investing over Active management.
• 11:09 General Structure of our implementation.
• 12:31 Text us

Your portfolio’s purpose is to be used to accomplish the goals that you value. This can range from lifetime spending, paying for schooling, buying property, and passing down wealth to future generations.

These goals all come at differing times and with varying levels of importance based on what you prioritize. Your portfolio needs to be built around these goals as money is the tool that helps you accomplish them. 

This process is complex and involves communication back and forth, but it ultimately builds a financial foundation that gives you the highest level of confidence to achieve what you set out.

Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network.

Episode Highlights

• 0:00 Intro
• 0:38 How do we actually allocate your portfolio
• 2:03 Your most important priorities are the foundation. 
• 3:10 We focus on your needs and what actually matters in your life 
• 4:35 Why off-the-shelf portfolios lead to returns being “left on the table”
• 5:37 How public markets generate passive income
• 6:43 How do we use your excess funds to generate the returns you deserve
• 8:15 How investing globally smooth’s out returns and leads to higher confidence in long-term returns
• 9:59 The stats behind experts like Jim Cramer
• 12:31 Integrating diversification and rewarded factors to your benefit
• 14:40 Text us!

In markets, risk and return go hand in hand. The more risk you can take with your portfolio, and the more time you can leave money invested in markets that generate a risk premium, the higher your expected return will be.

Even through periods like the dot com bubble and the Great Recession, long-term risk exposure was not punished, it was actually rewarded if you stayed invested through all the chaos. If too much of your money is exposed to risk and markets hit a period of turbulence, there may be a loss of capital, but expertise in management can shield you from these times of market turmoil.

It may sound very simple, but the process of properly thinking through your priorities and figuring out what you need now, and what you can do without until later, ends up generating a great deal of wealth over your investment life cycle and keeps any market hiccups from interrupting your day to day life.

Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network.

Episode Highlights

• 0:00 Intro
• 1:03 How do we evaluate the news and updated financial data?
• 3:23 Are all trends important and what are we looking for?
• 4:21 Differences between evaluating data as it relates to public and private markets
• 6:00 How we use your general financial structure to create building blocks that enable you to seek outsized returns in the private markets
• 7:37 Thinking through your most important factors and goals, and using those to properly tailor your portfolio
• 9:13 Matching your priorities with assets that help you achieve your goals, and also achieve the highest expected returns 
• 10:45 How your savings and discipline early on in your career can lead to the best chances of achieving exceptional returns
• 12:09 Protect what you need and risk what you can
• 12:40 Text us!

As new economic data is reported and forecasts are updated, it’s easy to get lost in the constant flow of information. You will hear things from just about every source out there. But does it matter? What info is important to pay attention to?

As entertaining as markets can be, it’s imperative to remember that markets serve you. It’s not the other way around as the rest of the industry sometimes presents it.

Taking your situation, priorities, and needs FIRST, and then factoring in market information is the only way to confidently achieve your goals. 

Removing step one or pushing it down the list only leads to a less personalized approach that will not give you the same level of certainty as a robust and tailored solution. You deserve to have a strategy built around you and what truly matters in your life.

Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network.

Episode Highlights

• 0:00 Intro
• 1:17 What is a Soft Landing and how would that impact markets
• 3:38 Why timing and predicting the impact of data doesn’t work and is the wrong game to play
• 4:06 How AWM builds portfolios for your success in a more robust and tailored way than the rest of the industry
• 6:32 Why building portfolios in this fashion gives you true confidence of success
• 7:51 What do proper planning and portfolio construction lead to
• 9:15 Why it “pays off” and gives clients peace of mind to implement this complex framework
• 12:10 Text us!

Exchange-traded funds (ETFs) were first launched on January 22nd, 1993 and have helped investors of all sizes save money on fees, diversify their portfolios, and reduce their annual tax bills.

The structure and operating process of the ETF paired with a diligent, diversified, and rules-based investment approach enables investors to hold extremely efficient portfolios that could previously only be constructed with 100s of millions of dollars.

We touch on the most important principles and themes to know about ETFs as well as some current events around tech layoffs and why they may not be as negative as they seem.

Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network.

Episode Highlights

• 0:00 Intro
• 0:35 Anniversary of the ETF
• 0:58 What do we think about the recent Tech and Banking layoffs?
• 2:50 What lead to some of these layoffs?
• 4:48 The silver lining of the Tech layoffs
• 6:34 How layoffs and market cycles relate to your portfolio, general diversification, and positioning.
• 8:01 Benefits of diversification and how ETFs help
• 9:40 What do ETFs enable you to do?
• 10:22 The positive attributes of ETFs and how they help you save money on fees and taxes.
• 11:55 Wrap up

Does evaluating financial statements for publicly traded companies lead to better returns? This may seem like a simple question on the surface, but understanding the magnitude of the question is important. 

There are roughly 60,000 publicly traded companies worldwide according to the World Federation of Exchanges. A company, like Apple, generates a summary of financial performance in a document called a 10K that has 80 pages, 1000’s of data points, and countless footnotes to qualify the data (as different companies report on metrics in different ways.) 

That information is also mainly backward-looking, and only relevant for a short amount of time in our ever-evolving world. What you are left with are billions of numbers that don’t relate to each other. Also, there has been no proven method of using any of these figures for consistent returns.

All of this may seem stressful (and it is), but it can also be harmful if it takes attention away from the most important elements in your financial life, your structure and plan. Focusing on your plan, lifestyle, and the factors you can control will lead to far more benefits than looking at Apple’s Commercial Paper holdings.

Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network.

Episode Highlights

• 0:00 Intro
• 1:01 Do we read financial reports and try to value companies based on fundamentals?
• 2:00 Public vs. Private Market Dynamics
• 2:46 Recent Rally was a result of the market repricing interest rate expectations
• 4:26 Trying to be an active manager and outguessing the markets has been shown to be impossible to do consistently
• 6:13 What an active manager believes and how it would relate to a company (i.e. Tesla)
• 8:14 What is a relevant baseball example for being an active manager
• 9:13 There are different elements, themes, and dynamics in Public and Private markets
• 11:15 Going through fundamentals and the data is more productive in the private space
• 12:47 Wrap Up

Welcome to 2023! The New Year is always a natural time for reflection. We looked back on the year that was in our last episode.  In this week’s episode we take a look forward and set some foundational expectations for the year ahead, whatever it may bring. 

The big topics in the financial media at the moment are 2023 predictions. And they are just that, predictions! No one has a crystal ball and no one seems to be able to predict the future with any certainty. So while it is certainly a fun exercise and a great topic over a beer or glass of wine or other beverage of choice, history shows you should definitely stop there and rely on a systematic, long-term approach to managing and building multi-generational wealth. Just remember markets tend to fool most people most of the time and we’ll talk through ways to avoid this

As we enter 2023, it’s important to remember that we view money as a tool to accomplish your priorities. We want to intentionally allocate your money in a way that supports what is most important to you. As such, we structure portfolios and your net worth in a way that increases the likelihood of success and minimizes the impact of chance on your outcomes. 

Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network.

Episode Highlights

• 0:00 Intro
• 1:05 How do we think about predictions?
• 1:19 What we are thinking about going into 2023
• 2:32 Markets are positive on an annual basis about 75% of the time
• 2:52 2022 validated some of our thinking
• 3:25 Flashback to Dec 2019, who would’ve predicted where we are today?
• 4:42 It’s natural to think we can outguess markets but reflection helps remind us what actually works
• 5:11 You don’t have to play the prediction game to succeed
• 6:59 The importance of Bonds in a portfolio
• 7:50 Markets fool most people most of the time
• 9:35 Focus on meeting your priorities in the highest probable way
• 10:18 Humans are wired for short-term gratification
• 11:53 Wrap up

2022 has been a rough year for investors and brought in a long list of exceptional events. Meltdowns in SPAC’s and Crypto, an energy crunch, rising interest rates, and an unprecedented war overseas lead to market reactions and financial turbulence. Most Equity and Bond indices finished the year in the red. The S&P 500 also snapped a 3-year winning streak of double-digit annual returns. 

Losses are never ideal, but it is important to reference history and understand how market performance affects your portfolio and overall financial well-being. 

The S&P 500 has a “record” of 71-26. Over the past 97 calendar years, 71 have been years with positive returns. The average return during a positive year was 21% while the average return during a negative year was -13%.

The skew and magnitude of returns are in the favor of the investor and working with a team that properly positions your portfolio to capture the upside while also protecting your priorities is essential to both participate in the market and achieve your goals.

Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network.

EPISODE HIGHLIGHTS

• 0:00 Intro
• 1:01 Year-End Review
• 1:29 How accurate were the predictions for 2022 returns from the “Experts”
• 2:13 Emotional responses to volatile markets
• 2:38 Notable events in 2022
• 4:43 Has a recession been declared
• 5:44 How are we positioning our portfolios for the future given the turbulence
• 7:06 Controlling what we can control, and how we used volatility to our advantage with Tax Loss Harvesting
• 8:14 Interest Rates movements and their impacts on your financial structure
• 11:08 How interest rates affect Equity markets
• 11:53 Why paychecks during downturns are a huge positive
• 12:25 Markets pivoting on new information and fed stance
• 13:25 Key Takeaway 1: Don’t let short-term news derail your long-term plan
• 14:03 Key Takeaway 2: Is your fixed income allocation working in the right way for you?
• 14:35 Key Takeaway 3: Global Diversification
• 15:01 Key Takeaway 4: Markets are forward-looking, and they consider investor sentiment
• 15:40 Predictions for 2023
• 16:55 Wrap Up

Tailoring a portfolio to your needs is very similar to designing and constructing a home for you. A general plan needs to be established based on how many rooms are needed, what style and functionality are desired, and what amenities and extras can fit in the most optimal and seamless way.

It takes communication for the architect and designer to understand what is needed, and a plan needs to be drawn up to execute on those requirements.

Your portfolio is constructed in a similar fashion. Your most important priorities are used to sculpt the foundation, and the placement of rooms, amenities, and features flow from this foundation. 

A thoughtful approach ensures that you have everything you need and that you don’t run into any shortcomings in the future. Planning and intentionality separate a portfolio that works for now from one that will work for the rest of your life to achieve your purpose.

Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. On an iPhone? Click HERE to join.

EPISODE HIGHLIGHTS

• 0:00 Intro
• 1:09 Inflation- Does it matter and how are we navigating through it
• 2:30 What can we do to outpace inflation
• 3:56 How to insulate your portfolio against inflationary pressures
• 6:18 Why taking a purpose-driven approach makes life less stressful and improves your odds of achieving your goals
• 7:33 FOMO in the crypto world, News around SBF
• 9:35 How do we evaluate risky opportunities, and why due diligence matters
• 12:01 Governance and red flags with FTX
• 12:43 Involvement and Endowments with Athletes and Celebrities
• 13:47 What do excess resources mean to you
• 14:15 Hype Cycles
• 15:45 Key takeaway- Ask questions, do your research, take an appropriate level of risk
• 16:57 Wrap up

It often seems like the world economy is not prospering, but instead heading toward a recession. Negative news frequently dominates headlines, and it tends to catch the attention of investors more than its positive counterpart. The unfortunate reality is that optimism is rare and hard to come by.

If we went off headlines and article punchlines from the last two decades, we may think that the economy regressed. From the tough times in 2008 and the fall of financial institutions to 2020 when there was genuine concern that civilization as we knew it might collapse. Headlines were there to warn about the storm to come, but there was little thought given to what would happen afterward.

The peak of every negative news cycle produces the most fear and worry, and tends to be the time when winners and losers are determined. Those that accept losses at market lows and sell out do not participate in the recovery rallies to come, and those that are resilient and hold a long-term investment horizon are rewarded. Over the past 20 years, the S&P 500 has returned a cumulative 335.62%. That is the reward for weathering the storm.

EPISODE HIGHLIGHTS

• (0:00) Intro
• (0:59) Thoughts on the talk of Recession and how to actually think about it.
• (1:49) Recissions and the general relationship between the market and economy
• (2:58) Predicting the future, relevant news, and news cycles
• (3:57) Using information and trading on it, how does it pay off?
• (4:21) Interest rates and trading on assumptions
• (4:50) Long-term steady approaches improve your odds of success 
• (6:10) Short-term trading, why it just doesn’t work
• (7:45) Portfolio construction, keeping you invested and protected
• (8:39) The right question to ask about portfolio construction 
• (9:18) Health and Financial Health
• (11:03) Takeaways: Media, Economy, Dinner Convos
• (12:10) Consistency is key
• (12:20) Wrap Up