Category: NBBJ

Over the next 20 years, an estimated $84 trillion will pass from older generations to their heirs. This "Great Wealth Transfer" brings both tremendous opportunity and significant challenges. So, whether you're preparing to pass on wealth or expecting to receive it, thoughtful planning is essential. 

This past quarter brought plenty of ups and downs – and ultimately, higher than expected returns. It also serves as a powerful reminder of two core investment principles: (1) markets can change direction quickly, making it hard to time them, and (2) maintaining diversification remains one of the best ways to weather uncertainty. While these ideas are often repeated, they can be easy to overlook in the heat of short-term market swings, when emotion tempts investors to make decisions that could be harmful in the long run. 

A famous 20th century investor and fund manager, Sir John Templeton, once called the phrase, “This time it’s different,” the four most dangerous words in investing. The idea that the present is somehow “different” often arises from our natural tendency to magnify the present. The challenges we face today tend to feel monumental because they’re immediate and personal. And yet, history has shown that patience and perspective are powerful tools, especially in uncertain times. 

Wouldn’t it be great to just skip the bad periods and enjoy only the good ones? Unfortunately, trying to time the market based on the perception of market valuation has been academically proven to be nearly impossible to accomplish on any consistent or reliable basis. Success hinges on time in the market, not in timing the market. The longer you stick to your allocation, the more likely you are to achieve the return your portfolio was designed for.

With all the benchmarks we follow currently at or near record highs – coupled with US political concerns, interest rate uncertainty, and major global conflicts – clients have raised some big questions. How do we, as investors, reconcile a soaring stock market with such negative world news? Will the markets continue to rise to even greater heights despite so much turmoil? Unfortunately, the answers to these questions are simply unknowable. There is good news though: as a diversified investor, your portfolio has been carefully crafted to adapt to whatever may be on the horizon. 

With the 2024 US presidential election on the horizon, many investors are understandably concerned about how the outcome might affect their portfolios. Given the polarized political climate where both sides see the other as a threat to the nation’s future, it's only natural to wonder how your investments will fare. However, history shows us that a disciplined, long-term investment strategy will weather the storms of political change. 

The S&P 500 Index has posted exceptional returns for the past two quarters. It turns out that the most striking contributor has been the dominance of the seven largest stocks in the US: the so-called “Magnificent 7”. These companies alone made up 33% of the total value of the S&P 500 as of the end of March. It’s at this point many investors may question the validity of a more diversified approach: why settle for 6% returns when, if you just picked the right stocks, your returns could be much higher? The simple answer is that it’s harder than you might think.

Sometimes it can be difficult to remain a disciplined investor. Over periods of time, a diversified buy-hold-rebalance strategy can seem like it is not performing as well as it should, especially when we see some other “hot investment” making headlines. It can lead us to wonder if we may be missing out on some new and lucrative investment trend.