Between the markets and politics, the past year has been a pretty wild ride. We thought you might like to know what PIN’s thinking is and what actions we have taken, or may take. With the elections nearly upon us, we’ll begin with our thinking on that subject. In recent weeks, it has turned into a neck-and-neck race. It’s a highly unusual election – with something for everyone to dislike. In all my years, I don’t recall ever before being faced with an election in which I perceived my choice … [Read more...] about The PINnacle of the Market?
Given where the markets are, the geopolitical uncertainties, and the need for future planning we thought we would share with you some of our thoughts. This year started off exhibiting not only a strong market, but a good economy that justified it. While unemployment has been declining at the slowest rate in recent memory, that is in part due to the fact that business was forced by the “Great Recession” to tighten the belt and learn how to run far more efficiently. That “lean and mean” approach … [Read more...] about PIN Prognostications
When investing, human nature tends to split people between two extremes: Most are so risk averse they crowd into risk-free, guaranteed instruments (such as bank CDs, fixed annuities, money market accounts, etc.). In keeping with the law of supply and demand, with demand so high, the cost of such instruments will be high – that cost takes the form of very low returns. The other extreme is investors who look for investments to get rich quick – they seek speculative returns. What such investors … [Read more...] about The Value of Risk Management in Investing
Should you care about “correlation”? Absolutely! Understanding correlation will help you to know if your portfolios are properly diversified. Let’s begin with diversification. You’ve probably heard that diversification reduces investment risk, but how? Say there are only two companies: one that sells umbrellas and another that sells sunscreen. If a portfolio is completely invested in the company that sells umbrellas, it will have strong performance when it rains, but poor performance when the … [Read more...] about Correlation – “The Basis of Risk Management”
When we attended the 2009 North Carolina Guardianship Association Conference and the NGA Colloquium, we stayed with dear friends on Lake Norman. With 500 miles of shoreline, it was fun boating on the lake. When I asked our friend what the large signs sticking out of the tops of telephone poles in the middle of the lake were, he said they marked the shoals. Without these signs, boaters unfamiliar with the location of shoals could beach their crafts. There are shoals that we need to watch out for … [Read more...] about How To Calculate Returns on Investment Accounts