If you were away from news of media outlets for the past month, you could be forgiven for not knowing that the United Kingdom through a national referendum voted to exit the European Union. The media treated it as an event with seismic impact to the financial markets, and the Dow Jones Industrial Average (DJIA) proceeded to drop 870 points or 4.89% over the subsequent two days. Less heralded (meaning not at all) was the fact that the DJIA proceeded to climb 809 points or 4.65% over the rest of the week, and has continued to forge ahead since. Additionally, the DJIA had climbed 335 points in the four days leading up to the Brexit vote, so for the two weeks surrounding the vote, the DJIA had actually increased 274 points or 1.55% (all data from Yahoo finance).
The media more and more takes every opportunity to create a whirlwind of excitement in order to generate advertising revenue. But a short term perspective creates anxiety, which often overwhelms rationality. I'm not endorsing a "head in the sand" approach to investing or financial planning; in fact just the opposite: a thoughtful, calculated decision making driven by evidence and logic - and tailored to your objectives.
As I said in my last newsletter, perspective can be useful. If you can find and focus on the right spot on the horizon and set your course accordingly, the intervening gusts don't have much impact.
I thought some of you might be interested in an update on the state of our practice.
We are continually striving to increase the breadth and depth of understanding that we bring to our clients. Lea has started to study for her securities licensing exams. Lisa is in her second semester of studying for her Certified Financial Planner designation.
We have also subscribed to a new software system that helps develop a better understanding of risk tolerance by presenting multiple scenarios from which investors choose, and subsequent questions are keyed off of answers to previous questions. It's imperfect, but it does provide clients and us with additional insight. If you'd like to try it out, please just let me know and we'll send you a link.
We have seen some growth in the practice recently and are planning for more. Over the past several months, we have brought on a number of new clients with interesting, complex financial situations, and worked with existing clients on new issues that have required some complicated tax and estate planning. It is the sort of stuff that we love sinking our teeth into, and where we often find the opportunity to create substantial value. We would love to find more of those types of clients.
If you have friends or colleagues - in particular, people that you like and respect - who have complicated financial situations, I would love the opportunity to see if we can help them.
As many of you know, my parents have a home on Lake George in upstate New York where they spend the summers. My siblings and I try to get up there as often as we can. Last weekend we all convened there with our families: my brother, his wife and their newborn son; my sister, her husband and their two-year old, and me (Naomi couldn't make it) and my five and six-year old. It was as if my mother, a retired preschool teacher, had found the holy grail. It was, I think, the perfect birthday present for her.
Bard Malovany, CFP
8500 Executive Park Ave, Suite 400
Fairfax, VA 22031
Do you know a colleague or friend who is in or nearing retirement who has complex investment or financial needs and would benefit from a stronger advisor? Just send a brief email introduction to us, or call 703.916.8400 with contact information. We'll politely contact them to offer a free consultation to provide our observations and recommendations.
Footnotes and Disclosures:
The Dow Jones Industrial Average (DJIA) is an unmanaged index of stocks considered to be representative of the overall US stock market. The indices mentioned are not available for direct investment. This commentary may contain forward looking statements that are made subject to certain risks and uncertainties, which could cause actual results to differ materially from those presented. Readers are cautioned to not place undue reliance on these forward looking statements, which speak only to the date such information was posted. Aspect Partners undertakes no obligation to publicly revise these forward-looking statements to reflect events or circumstances that arise after the posting, and those events or circumstances may have a significant impact on those forward-looking statements. The views expressed are not those of Lincoln Financial Group. Neither Lincoln Financial Group nor Aspect Partners makes any representations or warranties as to the accuracy of the data presented nor any forward-looking statements contained herein.
Securities and advisory services offered exclusively through registered representatives of Lincoln Financial Advisors Corp., a broker/dealer (member SIPC) and registered investment advisor, of which Aspect Partners is not an affiliate. Insurance offered through Lincoln affiliates and other fine companies.