Our next event will focus on the dissimilarities between particular investments and markets and how to use these realities for your long and short-term benefit.

“The market is up, so why are my funds down?”

Over the past few months, I’ve heard something like this from a number of clients. This is a great question, and while the answer is simple, it’s not always a simple one to live with in the short term.

Here’s the answer: “What is the market?”

I know. I answered a question with a question, but stay with me for a minute. If by “market” you mean only large companies in the US, then the market would indeed be up while your investment portfolio is not.

But, if by market you include large, small, and micro-cap companies; value and growth companies; emerging markets (emerging small and emerging value), then you have a different result altogether.

You also have a different expectation.

All the returns with less risk.

My clients own 19 distinct asset classes in over 45 countries. Their portfolios are engineered to produce the return of each particular class in an environment of the lowest total volatility possible. Put simply—and the reason for diversification in the first place—you can have all the returns of the total market with less of the risk. You just have to be willing to have a portfolio that underperforms the US large company stock market every so often.

Later this month at our next event, I’ll be talking about how to do this and why.

A quick note about another dissimilarity that often exists…

In the past week, the US stock market has been down. Frequently when this happens, the US bond market goes up (see the chart below), and there are often interest-rate opportunities at times like this.

If you have not talked to a qualified mortgage advisor recently, call my office. My team can direct you to Churchill Mortgage, and either I or one of my Home Loan Specialists will help you analyze your situation.