Episode 28: Does Stock Picking Work?

When you think of success stories like Tesla and Apple, it can be tempting to try your hand at individual stock picking. However, the risks outweigh the rewards. For every Tesla there is an Enron, and for every Apple there is a WorldCom. For stock picking to work, you have to make two well-timed decisions: when to buy and when to sell. The chances of getting both correct on a consistent basis are quite low. Over the past five years, over 30 percent of individual stocks lost money, compared to just 0.2 percent of mutual funds and ETFs. Investing in mutual funds and ETFs takes away the need to correctly time the buy and sell decisions, which is why these are our preferred investments at Flourish.

Always check back next week for more Flourish Insights with Jay Pluimer and don't forget to check out our insights blog at https://www.flourishinsights.com

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Episode 27: Wall Street - The Reality Behind the Bad Reputation

Wall Street has a wide variety of definitions, some positive and some negative, but what do all the shades of gray really mean? It’s a physical location in downtown New York and the home of the New York Stock Exchange (NYSE), and it has become a catch-all term for all things investments, but there’s more to the story. In this episode, Jay Pluimer discusses the main functions of Wall Street for businesses and investors, and explains why its disreputable reputation doesn’t adequately provide a full picture of what Wall Street really means to all Americans.

Always check back next week for more Flourish Insights with Jay Pluimer and don't forget to check out our insights blog at https://www.flourishinsights.com

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Episode 26: GameStop - The Difference Between Investing and Trading

At Flourish, we build client portfolio allocations and use a mixture of mutual funds and ETFs to accomplish long-term goals. Taking a long-term approach like ours, based on upside potential over time, is called investing. Trading, conversely, focuses on making money in the near-term by capitalizing on price changes, upcoming announcements, and expectations of short-term gains. Trading is exemplified by the recent headlines on GameStop and others and, while it’s not necessarily bad, we prefer the risk-reward benefits of investing. As Warren Buffet once said, “Our favorite holding period is forever.”

Always check back next week for more Flourish Insights with Jay Pluimer and don't forget to check out our insights blog at https://www.flourishinsights.com

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Episode 25: Are We In a Market Bubble?

We witnessed a surprisingly strong stock market rally in 2020, following a strong year in 2019, which has led many people to wonder whether we are in a market bubble - the term used to describe an overvalued stock market. While some data points say it’s possible, our perspective at Flourish is that we have a fairly-valued market, with some areas that could be approaching “bubbly” valuations. Context is important, and Jay Pluimer provides a broader look at the market in this episode as he shares unique insight and perspective.

Always check back next week for more Flourish Insights with Jay Pluimer and don't forget to check out our insights blog at https://www.flourishinsights.com

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Episode 24: The Key Objectives for the Federal Reserve

Also known as the Fed, the Federal Reserve was established in 1913 to act as the central banking system for the United States after a series of financial crises at the beginning of the century. It is an independent organization that reports to Congress for oversight, and it’s three key objectives are to stabilize prices, maximize employment, and moderate inflation. Over time, the Fed’s powers and influence have increased in response to crises, including the current pandemic. In this episode, Jay Pluimer recaps recent actions by the Fed, discusses what we can expect in the current environment with the Biden-Harris administration, and explains how the Fed continues to support the economic recovery today.

Always check back next week for more Flourish Insights with Jay Pluimer and don't forget to check out our insights blog at https://www.flourishinsights.com

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Episode 23: The K-Shaped Recovery

A K-shaped recovery describes the situation where performance for different parts of the economy goes in different directions. In this case, one part goes up while another part goes down, diverging like the arms of the letter K. Currently, the vertical line of the K is the starting point - when the U.S. economy shut down in March 2020 due to COVID. Since then, we’ve seen positive recoveries for the Big 5 stocks, as well as upswings for companies that support the quarantine lifestyle. The service industry, mostly made up of small businesses, has been on a downward trajectory since the shutdown, however, with over 6 million newly unemployed or underemployed people who can’t work from home.

Always check back next week for more Flourish Insights with Jay Pluimer and don't forget to check out our insights blog at https://www.flourishinsights.com

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Episode #22: Expectations for 2021

Based on the record-breaking year we experienced in 2020, and the mass distribution of COVID-19 vaccines expected for the coming months, we are cautiously optimistic for the economy and the stock market in 2021. Economic predictions include a moderate recovery in the first half of the year, with a bigger upswing in late 2021. This would lead to economic growth rates of approximately 3-5 % in the United States. The recent rally for U.S. and international markets reflects this stronger growth outlook, which dampens our expectations for market returns in 2021. Most economists are predicting positive single-digit returns for stocks this year to offset the big recovery we experienced in 2020.

Always check back next week for more Flourish Insights with Jay Pluimer and don't forget to check out our insights blog at https://www.flourishinsights.com

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Episode 21: Reflections on 2020

This past year was one for the record books, both for the stock market and for the greater economy. The year began fairly well, with the S&P 500 hitting a record high on February 19. COVID concerns soon impacted the market and the S&P dropped 34%, bottoming out on March 23. State and Federal officials soon initiated the CARES Act and the Paycheck Protection Program, lending to economic recovery and the S&P’s fastest recovery in history. The end of the third quarter was still characterized by market uncertainty, but the fourth quarter brought more growth, with small-cap stocks particularly strong. Though there are still disruptions in the broader economic recovery, the distribution of several viable COVID vaccines is fueling optimism as we move into 2021.

Always check back next week for more Flourish Insights with Jay Pluimer and don't forget to check out our insights blog at https://www.flourishinsights.com

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Episode 20: What is a TINA Market?

As we move into 2021, we may be in for a TINA market, which stands for “There is No Alternative” and refers to a market where stocks offer better returns than other asset classes. If we end up with a TINA market for the next several years, it may have the effect of creating unrealistic valuations over time because people buy stocks simply because there is no alternative. Remember to keep your portfolio diversified, since bonds still offer less downside risk and other asset classes like real estate, gold, and bitcoin, can offer long-term investment opportunities, too.

Always check back next week for more Flourish Insights with Jay Pluimer and don't forget to check out our insights blog at https://www.flourishinsights.com

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Episode #19: The Investment Impact of Vaccines

Vaccines are now being deployed in the United States and around the world, and it’s important to consider what this might mean for the economy and investors. They have already been receiving the benefits for the past three months, and these market gains reflect a prediction that we should have a broad recovery in 2021. This expected return to “normal” will likely include continued investment gains, U.S. GDP growth of greater than 3%, and increased consumer demand. Jay Pluimer discusses more details in this week’s episode.

Always check back next week for more Flourish Insights with Jay Pluimer and don't forget to check out our insights blog at https://www.flourishinsights.com

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