AWM Insights Financial and Investment News

The last month has been a wild ride in the financial markets. At one point, we were down 34% and then all the sudden we have seen a quick rebound where - as of today (April 7) - the S&P is up 24.7% from its 52 week low that had been set on March 23rd. 

As we mentioned last week, what can happen during these times of flux is that people can tend to rely on asking important questions to the wrong people about what to do with their money. We have seen issues where people have put their trust in experience ("I have lived through this before") rather than expertise ("I'm educated, certified, and experienced in this issue").

In today's episode, we highlight another tactic that can prove beneficial for some called Tax-Loss Harvesting. Topics covered include:

• The importance of expertise over experience
• What is tax-loss harvesting, and what should I know about it?
• The two main benefits of tax-loss harvesting
• When does tax-loss harvesting matter?
• Who should be benefiting from this practice?
• Are there times you should not employ this tactic?
• Is it helpful to have multiple investment advisors?
• Other strategies that can be utilized during this time

The financial market upheaval that has accompanied the COVID-19 epidemic has been a teachable moment for investors. The S&P had been down 34% and investors wondered if it would ever stop falling. People were asking if they should take their money out of the markets - another form of trying to time it. Then, in 3 days, the market bounced back 17%, which was the biggest 3-day gain since 1931. As of March 31st, markets have reclaimed nearly 50% of the decline that happened. 

So then, can we confidently claim that this is the bottom? Does it even matter if we can know or not?

There are plenty of voices online and in the media who are ready to tell you who to buy and who to sell, but the questions you should be asking are: Who should we trust with our financial advice? Who is actually qualified to give that advice? 

Listen to this week's episode to hear Erik and Brandon discuss these topics and more.

In times of uncertainty, it's human nature to try and control things - specifically within investing. Some of the most frequently asked questions we've received from our clients are: "Should I be reacting right now to try and stop the bleeding?" or "What are ways to utilize this market downturn to turn a seemingly bad financial situation into a good one?" We've also consistently been asked "Is this downturn different then all previous ones?"

Ben Carlson compiles some important stats in his recent blog post noting that while the U.S. stock market is currently down roughly 32% from all-time highs, that the market falling even up to 40-50% from previous all-time highs has been a fairly common pattern all the way back to the 1920s.

So what should you be doing during this downturn? And what should you be expecting your wealth advisor to be doing during this time? Are there any mitigating steps your advisor should be taking right now that will help to keep your portfolio diverse and set you up for the best possible outcome in the future?

Brandon and Erik discuss these questions and more in this week's episode.

Welcome back to another edition of AWM Insights. With all the recent public market volatility, we've been highlighting the importance of our long-term investment strategy. Since 1928, there have been 24 bear markets. A unique trait they have all shared is that every one in U.S. history has then led to new all-time highs. However, while it's important to stay patient and stick to the plan - we also don't want to just "do nothing" during this time.  In this week's episode, Erik and Brandon begin their discussions on smart financial strategies that we utilize during these market downturns to add tremendous value to portfolios. First, we breakdown the value of Rebalancing and cover items such as:

• What is rebalancing
• Why is it so valuable?
• When should you rebalance?
• What are the potential pitfalls?

Welcome to our new bonus series: AWM Insights! In these mini episodes, we will hear from the AWM team on different topics and resources relevant to our community in 5-7 minute episodes. 

For our first episode, there is an easy segue with the news of the Covid-19 virus and its impact on global markets. This has been a concern from a human level and a health level - however, our strategy remains the same as it relates to navigating the fluctuating markets. Listen in for more from two of our founders, Erik and Brandon.