Three Simple Rules of Investing

Sidebar to "No Compromise"

Politics and Investing Make Strange Bedfellows. Since both parties believe that the world will end unless their partisan views are realized, economic fundamentals are a much more important input to the investment process. Bulls and bears can make money, but die-hard donkeys and elephants usually get slaughtered.

Remember to Rebalance. Re-allocating to original target percentages after big gains or losses in given asset classes enhances return and diversification. Minimize tax effects by balancing the harvest of gains and losses.

Embrace Strategic Investing. Markets are responding faster than ever to economic news, earnings and other events. In this dynamic environment, advisors need to respond similarly. This will require significant new idea generation, as the pressure to trade out of fully-valued investments (and into new positions) increases. Clients will likely lose patience with RIAs who can’t acknowledge the rapidly evolving investment landscape.

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