Welcome to the Making Margin podcast! Greenway’s team is here to discuss common financial mistakes and to help you navigate them. 

Meet the voices behind Making Margin:

• Nick
• Drew
• Natalie

Today’s episode: 

• How can we be confident in 6% (or higher!) growth rate?
• Why do we think it’s important to have equities (and/or bonds) in a portfolio?
• We have to set some expectations regarding investment planning. So, how do we come to the conclusions that we do when designing a portfolio?
  
   

Discussion Topics:

• There is an equity premium.  We know intuitively that the founder of a company has more to gain and more to lose than the bank from which he borrows the money.  A bond is comparable to a bank that is lending out money.  The bank expects the return of their capital and a slight return on their capital.  A business owner is looking for a multiplication of capital.
• The longer the history, the more confidence you can have -- Looking at monthly data in the US from January 1926 to July of 2020, there have been just over 1130 months.  This means that there have been over 1000, 10-year periods - 120 months squished together.  
• Have a realistic expectation - Morgan Housel wrote, “Markets crash all the time. You should, at minimum, expect stocks to fall at least 10% once a year, 20% once every few years, 30% or more once or twice a decade, and 50% or more once or twice during your lifetime.”
• What’s the point of investing? Maximizing return or reaching a goal?
• Investor’s Manifesto