As financial advisors we’re constantly advocating for investors to maintain a long-term view. We consider it to be fundamental, not only as an example of good investor behavior, but as a way of minimizing the emotional toll of “riding the rollercoaster”.
But what does it mean to have a long-term perspective? How long is long enough?
Do you ever feel “the curse” of investing at precisely the wrong point? Like you invested too late, at the wrong time, or maybe you’re just unlucky? Let me introduce you to Bob – the World’s Worst Market Timer.
Hindsight is 20/20, but finding clarity in future uncertainty can be fuzzy.
AT LPL RESEARCH, as we look forward to the year 2020 and a new decade, some key trends and market signals will be important to watch, including progress on U.S.-China trade discussions, an encouraging outlook from corporate America, and continued strength in consumer spending.
Trade risk, slower global growth, and the impeachment inquiry have garnered a lot of the headlines recently, but behind the scenes the U.S. economy has remained resilient. Economic data has been meeting lowered expectations, indicating an expansion that is still enduring. Most recently, third quarter economic growth was consistent with the long-term trend of this current economic expansion, which is now more than 10 years old.
We expect the U.S. economy to continue to grow in 2020 and support gains for stocks, although we are increasingly mindful of our position in the business cycle. At some point in the future, this record-long expansion will come to a close, leaving investors wondering what’s next. Against this backdrop, questions about the next potential recession and the 2020 U.S. presidential election continue to be top of mind for many investors. While we can’t see into the future, one thing we can predict is that uncertainty in the markets is here to stay. And we are here to help. We offer our Outlook 2020, your guide to preparing for this dynamic—and uncertain—market environment.
Read more about our forecasts and key themes in the full publication.
The average American spends more than 85 hours per month watching TV. The same person will likely spend about 265 hours sleeping and 228 hours working. Know how much time they’ll spend working on their finances? About 1.8 minutes, (yes, that works out to 96 seconds) per day.
It seems crazy to me that people will spend an hour on Yelp trying to find the perfect taco bar for dinner, but will invest thousands of dollars based on a 30-second spot on the Mad Money TV show. Read more →
https://prosperion.us/wp-content/uploads/2019/11/tv-picture.jpg7551500Steve Boorenhttps://prosperion.us/wp-content/uploads/2017/02/whitelogosized.pngSteve Booren2019-11-20 13:22:122019-11-20 13:22:12Improving Investor Behavior: Investing time now will pay dividends later
Anyone who has ever spent time outdoors understands and appreciates the value of a sharp knife. Whether stripping wood to start a fire, using it as a cooking utensil, cleaning a fish, or for any of a million other purposes, the trusty knife is an essential tool. But knives also have inherent danger as well. Used the wrong way, a knife can quickly put an end to a fun camping trip, or worse – a life.
With this in mind, let’s consider compound interest. For those who don’t understand the concept, compound interest is money earned on money spent or saved, typically expressed as a percentage. If you have a savings account, you’ve earned interest (albeit a tiny amount). This interest is compounded (i.e., multiplied) when the amount is left alone over a period of time.
In previous articles, we’ve discussed time as our most valuable asset. With only 1,440 minutes per day, how we choose to spend our time and where we focus our attention deserves the same rigorous budgeting that managing money does, perhaps even more so. Money is a resource; there can always be more of it. But time is finite, and there is no getting it back once it’s gone… or is there?
There’s a well-known quote by American author H. Jackson Brown that goes, “Don’t say you don’t have enough time. You have exactly the same number of hours per day that were given to Helen Keller, Pasteur, Michelangelo, Mother Teresa, Leonardo da Vinci, Thomas Jefferson, and Albert Einstein.”
But I want to challenge the notion that we all have the same amount of time each day. Think about it like this: I doubt Michelangelo had to mow his yard. I bet Thomas Jefferson didn’t spend much time in traffic. And when Einstein showed up to the restaurant, they probably made a table available for him. Read more →
https://prosperion.us/wp-content/uploads/2019/09/clock.jpg6461500Steve Boorenhttps://prosperion.us/wp-content/uploads/2017/02/whitelogosized.pngSteve Booren2019-09-20 11:21:462019-09-20 11:21:46Improving Investor Behavior: The Price of Time
What is Google worth? Most finance people would look up the share price, about $1,100 and multiply it by the number of shares to find what the company is currently “valued” at – about $790 billion. But does value always equal precisely what a company is worth?
If Google were to go out of business tomorrow and have a fire sale, offering up everything they have from patents to buildings, desk chairs to web servers, the total output would be significantly less than $790 billion. Likewise, if they were to announce a fully autonomous car, the value of the company could go up, likely by a significant amount.
The “worth” of a company goes beyond what it is presently priced at, to what the price could be in the future. Investors look at a company, say to themselves, “I like what they’re doing, and I expect them to grow in the future,” so they invest. They factor in a mix of intangibles: prospects for growth, risks, market conditions, and even a dash of hope, then decide to purchase a piece of that company. Collectively these purchases form the current share price.
This last week has been a roller coaster for investors with large, swift swings in the broad market indices. It began with an announcement from the Federal Reserve on interest rates and the White House levying additional tariffs against China, which was then followed by a tit-for-tat spat between the two countries. A devaluation of the Yuan, the U.S. labeling China a currency manipulator, and a drop in the bond market yields all served as reasons for the corresponding drops.
All that to say, a lot has happened in the span of a few days. It’s given investors cause for concern, whether justified or not. But this is volatility. This is the price we investors pay to enjoy an historically above-average return from more stable investments like bonds (which are now devolving into negative yields in countries around the world).
https://prosperion.us/wp-content/uploads/2019/08/china.jpg6231500Steve Boorenhttps://prosperion.us/wp-content/uploads/2017/02/whitelogosized.pngSteve Booren2019-08-09 13:22:202019-08-09 14:13:04An Emotional Tour de Force
https://prosperion.us/wp-content/uploads/2019/07/book-3d-copy.jpg4301500Administratorhttps://prosperion.us/wp-content/uploads/2017/02/whitelogosized.pngAdministrator2019-07-29 15:14:202019-07-29 15:16:25Intelligent Investing Book Signing at The Tattered Cover
As women we are no strangers to stress. We juggle countless plates, everyday, often at the same time. So we’ve created a workshop series by women, for women, built just for you.
The Decade in ReviewDecember 18, 2019 - 1:25 pm
The Decade in Review
As financial advisors we’re constantly advocating for investors to maintain a long-term view. We consider it to be fundamental, not only as an example of good investor behavior, but as a way of minimizing the emotional toll of “riding the rollercoaster”.
But what does it mean to have a long-term perspective? How long is long enough?
Improving Investor Behavior – The World’s Worst Market Timer
Do you ever feel “the curse” of investing at precisely the wrong point? Like you invested too late, at the wrong time, or maybe you’re just unlucky? Let me introduce you to Bob – the World’s Worst Market Timer.
Read more →
Outlook 2020: Bringing Markets Into Focus
Hindsight is 20/20, but finding clarity in future uncertainty can be fuzzy.
AT LPL RESEARCH, as we look forward to the year 2020 and a new decade, some key trends and market signals will be important to watch, including progress on U.S.-China trade discussions, an encouraging outlook from corporate America, and continued strength in consumer spending.
Trade risk, slower global growth, and the impeachment inquiry have garnered a lot of the headlines recently, but behind the scenes the U.S. economy has remained resilient. Economic data has been meeting lowered expectations, indicating an expansion that is still enduring. Most recently, third quarter economic growth was consistent with the long-term trend of this current economic expansion, which is now more than 10 years old.
We expect the U.S. economy to continue to grow in 2020 and support gains for stocks, although we are increasingly mindful of our position in the business cycle. At some point in the future, this record-long expansion will come to a close, leaving investors wondering what’s next. Against this backdrop, questions about the next potential recession and the 2020 U.S. presidential election continue to be top of mind for many investors. While we can’t see into the future, one thing we can predict is that uncertainty in the markets is here to stay. And we are here to help. We offer our Outlook 2020, your guide to preparing for this dynamic—and uncertain—market environment.
Read more about our forecasts and key themes in the full publication.
Improving Investor Behavior: Investing time now will pay dividends later
The average American spends more than 85 hours per month watching TV. The same person will likely spend about 265 hours sleeping and 228 hours working. Know how much time they’ll spend working on their finances? About 1.8 minutes, (yes, that works out to 96 seconds) per day.
It seems crazy to me that people will spend an hour on Yelp trying to find the perfect taco bar for dinner, but will invest thousands of dollars based on a 30-second spot on the Mad Money TV show. Read more →
Improving Investor Behavior: The Sharp Knife of Compound Interest
Anyone who has ever spent time outdoors understands and appreciates the value of a sharp knife. Whether stripping wood to start a fire, using it as a cooking utensil, cleaning a fish, or for any of a million other purposes, the trusty knife is an essential tool. But knives also have inherent danger as well. Used the wrong way, a knife can quickly put an end to a fun camping trip, or worse – a life.
With this in mind, let’s consider compound interest. For those who don’t understand the concept, compound interest is money earned on money spent or saved, typically expressed as a percentage. If you have a savings account, you’ve earned interest (albeit a tiny amount). This interest is compounded (i.e., multiplied) when the amount is left alone over a period of time.
Read more →
Improving Investor Behavior: The Price of Time
In previous articles, we’ve discussed time as our most valuable asset. With only 1,440 minutes per day, how we choose to spend our time and where we focus our attention deserves the same rigorous budgeting that managing money does, perhaps even more so. Money is a resource; there can always be more of it. But time is finite, and there is no getting it back once it’s gone… or is there?
There’s a well-known quote by American author H. Jackson Brown that goes, “Don’t say you don’t have enough time. You have exactly the same number of hours per day that were given to Helen Keller, Pasteur, Michelangelo, Mother Teresa, Leonardo da Vinci, Thomas Jefferson, and Albert Einstein.”
But I want to challenge the notion that we all have the same amount of time each day. Think about it like this: I doubt Michelangelo had to mow his yard. I bet Thomas Jefferson didn’t spend much time in traffic. And when Einstein showed up to the restaurant, they probably made a table available for him. Read more →
Improving Investor Behavior: Mind Your “Owned” Businesses
What is Google worth? Most finance people would look up the share price, about $1,100 and multiply it by the number of shares to find what the company is currently “valued” at – about $790 billion. But does value always equal precisely what a company is worth?
If Google were to go out of business tomorrow and have a fire sale, offering up everything they have from patents to buildings, desk chairs to web servers, the total output would be significantly less than $790 billion. Likewise, if they were to announce a fully autonomous car, the value of the company could go up, likely by a significant amount.
The “worth” of a company goes beyond what it is presently priced at, to what the price could be in the future. Investors look at a company, say to themselves, “I like what they’re doing, and I expect them to grow in the future,” so they invest. They factor in a mix of intangibles: prospects for growth, risks, market conditions, and even a dash of hope, then decide to purchase a piece of that company. Collectively these purchases form the current share price.
Read more →
An Emotional Tour de Force
This last week has been a roller coaster for investors with large, swift swings in the broad market indices. It began with an announcement from the Federal Reserve on interest rates and the White House levying additional tariffs against China, which was then followed by a tit-for-tat spat between the two countries. A devaluation of the Yuan, the U.S. labeling China a currency manipulator, and a drop in the bond market yields all served as reasons for the corresponding drops.
All that to say, a lot has happened in the span of a few days. It’s given investors cause for concern, whether justified or not. But this is volatility. This is the price we investors pay to enjoy an historically above-average return from more stable investments like bonds (which are now devolving into negative yields in countries around the world).
Read more →
Intelligent Investing Book Signing at The Tattered Cover
Author & LPL Financial Advisor, Steve Booren, will host a conversation and book signing event at the Tattered Cover at Aspen Grove in Littleton.
Workshop Series: Get Fed
As women we are no strangers to stress. We juggle countless plates, everyday, often at the same time. So we’ve created a workshop series by women, for women, built just for you.