AWM Insights Financial and Investment News on Steno.fm

AWM Insights Financial and Investment News

A bite sized discussion on timely financial news and investment topics, to help you maximize your net worth and wealth for the next generation with Brandon Averill, Erik Averill and Justin Dyer of AWM Capital.

Fri, March 29, 2024
Strategic Tax Planning: Maximizing Wealth Beyond Tax Season | AWM Insights #195
Tax has a crucial role in wealth generation and preservation. Professional athletes have very complex tax situations which make tax planning a year-round endeavor, not just a one-time stop during tax filing season. The importance of integrating tax strategies with investment planning can't be stressed enough as we have seen the countless pitfalls of receiving separate tax and investment advice. Proactive strategies must be taken on, and changing the game plan to account for updates in the tax code is essential to maximize and optimize wealth. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (714) 504-7689 to join our new AWM Insights Network. Episode Highlights 00:00 - Tax Planning Significance: Introduction to the importance of tax planning and filing. 00:59 - Tax Season Insights: Emphasizing year-round planning. 02:14 - Proactive Tax Strategies for Baseball Families: Projecting income and adjusting tax strategies for MLB players. 03:55 - Details on 401(k) Changes and Tax Planning: Adjusting to MLB 401(k) changes and leveraging Individual 401(k)s for tax benefits. 05:45 - The Importance of Coordinated Financial Planning: Integrating taxes with investment strategies for optimal wealth management. 06:45 - Pitfalls of Separate Tax and Investment Advice: The risks of not having integrated financial advice. 07:56 - One Net Worth, One Effective Tax Rate: The importance of considering net worth and tax rates together in financial planning. 08:41 - Client Guidance and Proactive Planning: Efforts to ensure proactive and sensitive tax planning for clients. 09:37 - Universal Relevance of Tax Planning: The applicability of tax planning strategies across professions. 10:00 - Closing and Importance of Continuous Communication: Encouraging ongoing discussions with CPAs for year-round tax planning.
Fri, March 22, 2024
Decoding Crypto's Comeback: Navigating Blockchain, Bitcoin ETFs, and Strategies| AWM Insights #194
Crypto has reemerged in the financial landscape with the recent rally in Bitcoin and the significant role of the SEC's approval of Bitcoin Spot ETFs. With all the hype, a cautious approach to the crypto space is prudent. This does not mean that the trend should be ignored. It’s essential to know and understand the ever-evolving investment universe. However, prioritizing investments in businesses with predictable cash flows over speculative bets on price movements is a tried and tested path to success. Venture capital and public company investments can provide exposure to innovative technologies including blockchain and even underlying crypto holdings via company assets. This approach gives you a higher probability of success in your journey for multi-generation wealth. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (714) 504-7689 to join our new AWM Insights Network. Episode Highlights 00:03 - Crypto and Blockchain Resurgence: Introduction to the renewed interest in cryptocurrency. 01:04 - Bitcoin's Rally and SEC's Role: Analysis of Bitcoin's price surge and impact of Bitcoin Spot ETFs approval. 03:57 - Investing vs. Currency Use in Crypto: The distinction between investing in and using cryptocurrencies. 04:43 - Investment vs. Speculation: Exploring the concepts of investing and speculation within the crypto space. 07:11 - AWM's Approach to Crypto: The firm's strategy towards blockchain and crypto investments. 08:02 - Venture Capital and Blockchain Technology: Leveraging venture capital for exposure to blockchain innovations. 09:51 - Picks and Shovels Approach: Focusing on the underlying technologies of the crypto world. 10:37 - Summary and Investment Strategy: Emphasizing the importance of a planned approach to investing, with cautious speculation in crypto. 11:26 - Text us!
Mon, March 18, 2024
Economic Trends and Market Insights | AWM Insights #193
The economy and the stock market are not the same. Usually, the market has a head start and prices in future economic events. The market’s recent rally preceded the positive news that came out in terms of inflation, GDP, and employment rates. Making alternative bets has been shown to be counterproductive. Investing with a long-term mindset and avoiding market timing and speculation has been the winning gameplan, and gives investors the best odds of creating and sustaining multigenerational wealth. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (714) 504-7689 to join our new AWM Insights Network. Episode Highlights 00:04 - Introduction & Market Overview: Insights into economic dynamics, and stock market basics. 01:03 - Economic Update: Analysis of inflation trends, GDP health, and employment status. 03:04 - Interest Rate Outlook: Changing forecasts, impact on markets, savings strategies. 05:18 - Stock Market Performance: Record highs in U.S. indexes, and global market trends. 06:23 - Corporate Earnings Analysis: Profitability insights, Q4 2023 earnings, company efficiency. 08:07 - IPO Trends, Market Liquidity: Reddit IPO, influence of public offerings on private investments. 09:22 - Crypto Market Trends: Bitcoin's surge, cryptocurrency speculation, investment strategies. 10:20 - Closing Advice: Long-term investing principles, avoiding market speculation. 11:26 - Text us!
Mon, March 04, 2024
Real Estate in the Multi-Generational Wealth Formula | AWM Insights #192
Real Estate is one of the most talked about asset classes. The allure of real estate comes from fact, fiction, and fallacy. Tax benefits, inflationary hedges, and income streams come with potential risks that are sometimes neglected, such as leverage, volatility, liquidity, and concentration. Incorporating real estate's unique advantages while considering and planning for the challenges is essential to building a well-diversified and prudent financial structure. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (714) 504-7689 to join our new AWM Insights Network. Episode Highlights: 00:00 - Intro 00:35 - Why Investors Love Real Estate? 01:14 - Real Estate in Public vs Private Markets 02:36 - The Behavioral Aspect of Real Estate Investing 04:09 - The Goal of Real Estate Investing 04:53 - Analyzing Real Estate Returns and Costs 07:34 - Benefits of Real Estate as an Asset Class 09:11 - Leverage and Real Estate Investment Strategy 10:24 - Text Us!
Mon, February 26, 2024
Building a Winning Portfolio | AWM Insights #191
What does it take to build a Winning Portfolio? The answer has a significant amount of overlap with how a GM would build a winning team. It starts with expertise and knowledge. You need to assemble a group that understands what winning is, what it takes to win, and how to get there. Compiling a cohesive team and continuously coaching and improving the team is needed, but also utilizing those players effectively and efficiently with a proper game strategy and playbook are the only ways to get the most out of your resources. Finally, plans and strategies must be constantly evaluated and updated for changing conditions. Building and maintaining a successful personal portfolio follows the same logical framework! Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (714) 504 -7689 to join our new AWM Insights Network. Episode Highlights 00:00 - Intro 01:01 - The "game" of investing 02:13 - Having the proper expertise, coaching, and team to win 02:57 - Developing a playbook for investing based on data and historical lessons 03:51 - The impact of missing the best days in the market 05:38 - Building your all-star investment roster 07:38 - Text Us!
Mon, February 19, 2024
Investing Beyond Elections | AWM Insights #190
The complexity of predicting market reactions due to events or scenarios playing out can be perfectly proved by looking at elections. There has been no statistically significant data that has shown elections swaying markets in any direction. Making investment decisions based on election results is a dangerous game to play. Long-term financial planning can create value while short-term trading strategies influenced by political events are more likely to destroy it. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (714) 504-7689 to join our new AWM Insights Network. Episode Highlights 0:00 - Intro 1:42 - Complexity of Markets and Elections' Impact 3:40 - Gameplays and investments 5:08 - Long-term Investment Strategy 6:09 - Text us!
Fri, February 09, 2024
Clarifying Misconceptions: The Real Impact of Elections on Markets | AWM Insights #189
There are many perceived effects of presidential elections on investment strategies and markets, but the data clearly shows that there is a misconception here. Over the past 100 years, there have only been 4 election years that have had negative returns, all of which were not influenced by presidential elections. Those 4 negative years were 1932 (Great Depression), 1940 (World War II Ramping Up), 2000 (Dot com bubble), and 2008 (Great Recession). Counterintuitively, the S&P 500 typically sees an average return of 11.5% during election years, which is slightly above the average return in all years (10.3%). Instead of being a critical component, elections are merely one of many factors at play when it comes to market performance. The importance of maintaining a long-term investment strategy and preparing for potential market fluctuations underscores the need for investors to distinguish between informed decision-making and impulsive reactions to political news. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji to Brandon at (714) 504-7689 to join our new AWM Insights Network. Episode Highlights 00:00 Intro 01:21 Data on the S&P 500 returns during election years, highlighting the minor impact of elections on market performance 02:53 The principle of voting in the ballot box, not with your portfolio 03:51 Volatility is elevated leading up to elections 04:44 Text us!
Sat, February 03, 2024
Investing Through Elections with Evidence-Based Strategies | AWM Insights #188
Presidential elections and financial markets have a nuanced relationship. All the media coverage and speculation around elections creates a significant panic and worry that can sway investor emotions. However, the historical data does not support making investment decisions based on the election outcome. Election years have shown no signs of differing performance from normal years. Financial markets are highly complex, and even though elections are important to policy, they are a single piece in a sea of factors that impact markets. Focusing on long-term financial goals and adhering to disciplined investment principles creates far more successful opportunities and outcomes for investors when compared to playing the election guessing game. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (714) 504-7689 to join our new AWM Insights Network. Episode Highlights 00:00 Intro 01:18 Discussion on the election as a significant behavioral event influencing investor emotions. 03:03 Insight into financial markets' processing of election outcomes without political bias. 04:38 Emphasis on the importance of evidence-based investing over emotional decision-making. 05:55 Historical market performance analysis showing resilience despite political changes. 07:16 Discussion on the nuanced effects of presidential policies on markets. 08:17 Conclusion and mention of future deeper dive into the episode's topic.
Sat, January 27, 2024
Navigating Market Uncertainty and Elections in 2024| AWM Insights #187
2023 was a year filled with surprises. It showed us how different predictions are from reality. As we kick off a year that is already starting with a lot of uncertainty and ending with a presidential election, it's critical to keep the lessons we have already learned top of mind. The key to successful outcomes is to block out the noise and focus on what matters over the long term. Market fluctuations are like the turbulence that a well-positioned portfolio can weather. It is imperative to stay disciplined, avoid emotional investment decisions, and continuously align your portfolio with personal priorities. There will be bumps along the way. Getting over the bumps and to the other side is what separates the best from the rest. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (714) 504-7689 to join our new AWM Insights Network. Episode Highlights 00:03: Intro 00:38: Current market dynamics and earnings expectations. 02:19: Uncertainty around interest rates and difficulty predicting markets. 03:24: Impact of the upcoming presidential election on markets and portfolio positioning. 04:30: Prioritizing short-term goals. 05:53: Emotional investment decisions and the importance of personal priorities. 08:50: Text us!
Fri, January 19, 2024
A Year of Surprises and Resilience | AWM Insights #186
In 2023, financial markets displayed remarkable resilience despite countless global challenges. Contrary to the predictions of a majority of economists, a recession was averted. This year highlighted the unpredictable nature of inflation, interest rates, and ultimately, financial markets. The year’s developments and the strong performance of markets underscore the importance of adopting a long-term, systematic approach to investing, rather than making reactive decisions based on short-term market fluctuations or media reports. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (714) 504-7689 to join our new AWM Insights Network. Episode Highlights 0:00 Introduction and overview of 2023's financial uncertainties. 2:01 Discussion on interest rates and inflation dynamics. 3:40 The Federal Reserve's handling of the economy. 4:42 Analysis of 2023's bond and equity markets. 7:45 Impacts of global events on the markets. 8:26 The 2023 banking crisis and its effects on venture capital. 10:47 State of the private markets in 2023. 12:35 The importance of a long-term investment strategy.
Sat, January 13, 2024
Reflecting on Your Financial Structure | AWM Insights #185
Creating a personalized financial structure is an intricate process that isn’t a “set it and forget it” task. As our clients move through their lives, they evolve and so should their financial structure. Accommodating these updates and protecting new, important priorities is the only way to keep a portfolio relevant to a client's needs. It takes constant and clear communication to establish and reestablish a plan that will continue to position our clients in an optimal position to achieve their goals. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (714) 504-7689 to join our new AWM Insights Network. Episode Highlights 0:00 Intro 1:10 Reflecting on your financial structure. 2:00 The value of refocusing and adjusting the plan due to updated circumstances. 3:23 Focusing on what you can control and evaluating the sources of news we consume. 5:26 Money is a tool, and are the right tools in your shed for your purpose? 6:35 Text us!
Sat, December 23, 2023
Measuring Your Financial Success | AWM Insights #184
Evaluating custom portfolios can be tricky. Unlike off-the-shelf investments, each custom portfolio is unique and tailored to an investor's family, making it hard to compare using the standard benchmarks you see every day. Private investments further complicate the process as they are valued in different ways and at different time intervals. The key to measuring success with these portfolios isn't just about how much money they make, but how well they help you reach your personal financial goals. It's more about the total progress of your financial structure, than just numbers. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (714) 504-7689 to join our new AWM Insights Network. Episode Highlights 0:00 Intro 1:13 How do you evaluate and measure your financial structure and success? 3:30 Considering your unique allocation when measuring performance. 5:03 Creating a personalized benchmark for success. 7:50 Text us!
Fri, December 15, 2023
Scheduling Your Financial Success | AWM Insights #183
Figuring out your purpose and intention is the first step to maximizing the impact of your wealth. After your intention is established, time needs to be set aside to execute on that intention and take actions that turn the concept into reality. Figuring out what needs to be done and how it needs to happen is crucial. We work with our clients to build a game plan that is realistic to execute and advise them along the way to achieve the goal at hand with a customized set of scheduled checkpoints. The Scheduling step on the road to success needs to be interactive to evolve with our clients' changing schedules and goals. Setting up a well-thought-out plan that takes the guesswork out of achieving your goals and being able to effectively adjust for any changes gives our clients clarity into what they can accomplish and the impact they can make. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (714) 504-7689 to join our new AWM Insights Network. Episode Highlights 0:00 Intro 0:45 Scheduling our intentions for success. 1:30 Building a game plan before the season and executing on that scheduled plan. 3:45 Constantly revisiting the scheduled plan to make sure it is in line with our client's needs. 6:50 Text us!
Fri, December 08, 2023
Intentionally Personalizing Your Portfolio | AWM Insights #182
Investing should be centered around you and the plan should evolve as your life develops and changes. This general concept may sound straightforward and logical, but the ideology of setting an intention for the funds in your portfolio and constantly reevaluating and adjusting them is not a common one. The simple reason for the lack of adoption is that this process is highly sophisticated. Foundations and Endowments manage their funds in this way. They have large teams dedicated to constantly finding purpose and making the updates necessary to stay on track. Our Family Offices’ human-centered approach enables families to implement the same sophisticated process as billion-dollar entities and accomplish the goals most important to them. Meaning matters, and honing in on that meaning through intentionality is the first step to properly managing multigenerational wealth. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (714) 504-7689 to join our new AWM Insights Network. Episode Highlights 0:00 Intro 0:15 Starting with Intentionality 1:10 How we use your vision and intentionality to build a portfolio. 2:35 Your portfolios are ever evolving. 4:50 Start big when building out your vision 6:50 Text us!
Sat, December 02, 2023
Building a Winning Plan | AWM Insights #181
Brian Cain works with dozens of professional athletes to push them to Mental Performance Mastery. His 4-step formula transcends sports performance and actually has a direct application to managing wealth holistically. Establishing your goals and envisioning your priorities is Step 1. Creating Intention is followed by Scheduling time to do the work to get there. As time is being spent to get to the target, progress and improvement need to be measured and monitored. Finally, a reflection regarding the development needs to be made which leads to refocusing to keep charging forward. Applying this formula to your financial framework creates focus, intentionality, and accountability to take the right steps to grow your wealth. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (714) 504-7689 to join our new AWM Insights Network. Episode Highlights 0:00 Intro 0:25 How to achieve your financial goals with the 4-step formula. 1:43 Intentions, Scheduling, Measuring, Reflecting and Refocusing 5:20 Applying the formula to your wealth and goals. 6:50 Text us!
Fri, November 24, 2023
Giving Thanks for Progress | AWM Insights #180
Looking back at this past year, there is more to be thankful for than just strong market performance. There have been many improvements and advancements in our industry that will impact all for the better. Our Industry continues to move away from the transactional business model. Advice and Expertise are dominating, and more businesses are putting their clients first to keep up. This, unfortunately, was not the norm. This year, our relationship with Charles Schwab expanded and enabled all of our clients to have free access to same-day Wires. Schwab also dropped their minimums for Charitable accounts, allowing more impact to be made. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (714) 504-7689 to join our new AWM Insights Network. Episode Highlights 0:00 Intro 0:30 What are we thankful for? 2:22 How have we seen the industry evolve and what we have learned along the way? 6:30 How the lessons we have learned have impacted the advice we give. 8:50 Text us!
Fri, November 17, 2023
Discipline and Consistency in Moving Markets | AWM Insights #179
Markets this week have reacted very positively to easing inflation figures and dropping producer prices. The positive news has changed the sentiment of markets and rewarded investors who took on risk in their portfolios. It was a great reminder of how Equities reward investors who take on risk in their portfolios. Obviously, risks must be measured and appropriately sized, but when a strong plan is implemented and followed, investors typically reap the benefits over the long run. Wealth isn’t built in a day, but it can be lost or eroded in a very short period of time. Building a strong financial structure that protects against downturns, while also being positioned to benefit from periods of positive market performance, is a ticket to a brighter future. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (714) 504-7689 to join our new AWM Insights Network. Episode Highlights 0:00 Intro 1:30 What’s going on in markets? 2:42 How shifting viewpoints move markets. 3:22 What sectors have performed well with changing sentiment? 5:57 The benefit of taking on calculated risk in your portfolio. 7:43 Predicting the future in the new year. 9:50 Text us!
Mon, November 13, 2023
How Do Higher Interest Rates Impact Your Investments? | AWM Insights #178
Interest rates across the board are at or near their highest levels in the last 15 years. While it's more expensive to get a mortgage nowadays, investors are benefiting from these higher rates with their investable assets. Short-term Treasuries are generating more than 5%, which is significantly higher than the rates we have seen for the last decade. It's important to remember that over the long run, Equity markets have returned more than 9% annually. Equities are riskier than bonds but have historically also had higher returns during periods of high-interest rates and have more protection against inflation. A thoughtful approach and implementation strategy are needed to ensure that funds are allocated toward the right assets to protect your goals and priorities while also optimizing your returns in the market. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (714) 504-7689 to join our new AWM Insights Network. Episode Highlights 0:00 Intro 0:20 Using high-interest rates to your advantage 1:42 How uncommon are these high-interest rates? 3:22 How do higher interest rates affect stock performance? 4:57 The Risk and Return dynamic over long periods. 6:43 How does your financial structure impact the risks you take? 7:45 The building blocks of expected returns and how do they relate to your financial structure? 10:50 Text us!
Sat, November 04, 2023
Taking the Guesswork out of Investing | AWM Insights #177
Stocks and their returns are built on the uncertainty of financial markets. No one knows what tomorrow holds. Bearing that risk is compensated when things go well, and punished when they don’t. Many try to play the guessing game in hopes of only getting positive results. The data has shown that this is not possible. Trying to outsmart the market consistently doesn’t work due to the unpredictability of the world. It's been proven that trying to avoid periods of negative performance harms investors as they miss out on some of the most lucrative returns during heightened uncertainty. Investing in markets is not easy. There will be bumps on the way, but the rewards far outweigh the risks when structured appropriately. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (714) 504-7689 to join our new AWM Insights Network. Episode Highlights 0:00 Intro 0:25 What might be a detriment to your financial structure? 2:32 What should you do when Stocks sell off? 3:02 The dangers of reacting to news. 5:57 Cutting through the nonsense and properly understanding financial vehicles. 8:50 Text us!
Sat, October 28, 2023
Building a Thoughtful and Productive Financial Framework | AWM Insights #176
A strong and thoughtful financial framework should be built around your life and enable you to accomplish your goals. Creating a strong connection between you and your portfolio ensures that your money is working for you specifically, and is allocated to improve your odds of success. A tailored financial framework not only reduces waste and enhances overall efficiency, but it also improves your focus as it clearly defines what should be done to get you to your destination, while steering you clear of potential pitfalls. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (714) 504-7689 to join our new AWM Insights Network. Episode Highlights 0:00 Intro 0:25 How does your portfolio tie back to your life? 1:52 The power of discipline and compounding returns. 3:51 Building the right decision-making framework and following it. 6:49 Visualizing the benefits of having a strong process 8:50 Text us!
Sat, October 21, 2023
The Power of Consistency and Commitment | AWM Insights #175
World developments frequently impact financial markets and test the resolve of investors. The fear, panic, and uncertainty these events cause are exactly what creates the concept of a “risk premium.” The evidence is also very clear. Those who weather the storm have been rewarded over the long run. Consider the COVID outbreak, the Great Recession, and the Dot Com Bubble. These were all significant periods where markets moved, but the investors who didn’t panic and stayed in the market were rewarded for their perseverance. Investing is not always going to be a smooth and comfortable ride, but the destination is worth it. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (714) 504-7689 to join our new AWM Insights Network. Episode Highlights 0:00 Intro 1:50 Uncertainty is unavoidable, but how can you construct your portfolio to weather the storm? 2:59 Uncertainty creates excess returns. 5:31 How hard is it to predict the future? 7:02 How market timing is a damaging strategy. 8:58 Control what you can control. 10:35 The power of diversification. 11:03 Text us!
Fri, October 13, 2023
The Science and Art of Investing | AWM Insights #174
Over the past 150 years, data on markets has been collected, analyzed, and an optimal investment process has been discovered. This process has been shown to reward investors over long periods. It includes taking advantage of diversification, flexibility, the efficiency of markets, and technological advancements that help markets function. Even with the rigorous, science-backed methods of investing, there is still an artistic and emotional side that can’t be ignored. The rewards of investing are founded on the principles of commitment and consistency, so managing your emotions, incorporating investments that matter to you, and being able to weather turbulence are just as important as the fundamentals. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (714) 504-7689 to join our new AWM Insights Network. Episode Highlights 0:00 Intro 1:55 Diversification and reducing unrewarded risk in your portfolio 2:29 Flexibility improves purchase prices 3:15 Active management is more of a friction than a value-add 3:50 How technological advances and market forces penalize active management 6:43 The Art of Investing 8:32 Investing as a practice 10:33 Text us!
Fri, October 06, 2023
The Multi-Dimensional Framework of a Family Office | AWM Insights #173
Financial services and investment expertise have traditionally been scattered across many different roles with no one “Quarterbacking” the process. In the past, investors worked with brokers, accountants, private investment specialists, and other professionals individually with differing levels of knowledge and involvement. There was little to no cross-communication between these individuals, and partitioned advice ultimately hurt investors. The Family Office Framework centralizes experts and allows them to collaborate and focus on delivering the most holistic and customized advice while offering the best investment experience. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (714) 504-7689 to join our new AWM Insights Network. Episode Highlights 0:00 Intro 0:49 The Multi-Dimensional Framework of a Family Office 3:19 Maximizing the facets of life through proper management of wealth 6:15 Looking at your wealth journey holistically 8:23 Building a healthy foundation 9:13 Text us!
Fri, September 29, 2023
Focusing on What You Can Control | AWM Insights #172
The news is usually saturated with events that are out of everyone’s control. This frequently triggers anxiety and panic. From Government shutdowns to predictions of financial turmoil, we are pulled into being invested in and accepting certain negative situations without looking at the bigger picture and realizing that there are actions we can take to financially prepare for an assortment of situations and outcomes. A well-diversified portfolio that is structured to meet and protect your critical priorities will shield you from the uncertainties that life and financial markets can throw your way. It’s essential to plan and prepare, instead of sitting back and predicting. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (714) 504-7689 to join our new AWM Insights Network. Episode Highlights 0:00 Intro 0:49 How do emotions impact financial markets and investing? 4:19 The power of planning and not predicting 6:15 How being a flexible investor and consumer improves your odds for success 8:43 The power of compounding returns and efficient portfolio management 10:40 Control what you can control 12:20 Tuning out the noise and staying consistent with your investment framework and thesis 13:53 Text us!
Sat, September 23, 2023
Finding the Right Steward for Your Wealth | AWM Insights #171
An advisor who is independent, integrated, and can work through your individuality will increase the odds of your family’s success and help you establish multigenerational wealth. Independence, and the lack of a corporate structure that places shareholder interests above those of clients, is imperative. An advisor who is there to work for you and views your interests as being their own as a fiduciary will inherently improve the alignment of values and your investment experience. Integrating different elements of wealth strategy from Investments to Financial Planning and Taxes, enables your advisor to truly take ownership of your wealth and deliver a comprehensive experience that checks all the boxes. Lastly, the ability to understand and work with your individuality, and not just place you in a mass-produced offering, improves the odds of success based on the tailored nature of service. S, M, and L are great measurements for shirt sizes, but exponentially more complexity is needed to manage something as important as your wealth. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (714) 504-7689 to join our new AWM Insights Network. Episode Highlights 0:00 Intro 0:41 What are the right ways to vet out advisors and get the best results and experience? 1:46 Ownership matters 4:25 The importance of finding an Advisor that Aligns their interests with yours 8:05 Why the Multi-Family office structure puts the client first and integrates all the experts you need 10:10 Independence, Integration, and Individuality 12:33 Text us!
Fri, September 15, 2023
The Essentials of Wealth and Risk Management | AWM Insights #170
The concept of “making it” or crossing the finish line in your Wealth journey is like the tooth fairy. It would be awesome if it existed, but it doesn’t. Preserving your wealth is a full-time job, and if done well, it’s a job that will be carried out past your lifetime. Working with a financial “Quarterback” helps your wealth grow and protects you from the unnecessary and avoidable risks that can erode your wealth. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (714) 504-7689 to join our new AWM Insights Network. Episode Highlights 0:00 Intro 0:31 What are the risks that can destroy your wealth? 3:16 Why not all kinds of risks are bad 3:45 The importance of Estate Planning and Family Dynamics 7:05 The Importance of Liability Planning 8:25 Death and disability planning 10:00 The importance of having a financial “Quarterback” 11:33 Text us!
Sat, September 09, 2023
Gathering, Preserving, and Expanding Your Wealth | AWM Insights #169
The saying “defense wins championships” applies in a few ways to portfolio management. Playing good defense (keeping your opponent off the board) and taking the risk out of the important areas of your life is the foundation of the game and gives you peace of mind as an investor. A leaky or inadequate defense leads investors to fall behind, and it’s hard to catch up without taking unreasonable risks. A strong defense enables you to take mindful risks to get ahead while still managing the current game and potentially saving an arm or giving a prospect some game time for future benefit. The offense is still very important, but it’s easier for a good offense to flourish when there is very strong confidence in the defense. Our goal is to finish ahead. A dependable and robust defense with a sophisticated and intentional offense is a winning combination. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (714) 504-7689 to join our new AWM Insights Network. Episode Highlights 0:00 Intro 0:40 How do we think about gathering, preserving, and expanding your wealth? 2:36 What are the benefits of having a custom-made portfolio? 5:45 How does a protective reserve approach allow your portfolio to take on risk to grow? 9:05 Why your net wealth is one holistic number? 11:33 Text us!
Fri, September 01, 2023
Magnifying the Impact of Your Wealth | AWM Insights #168
We frequently bring up the three uses of money (Spending, Saving, and Gifting) and how we help our clients expand their wealth and impact through each use. We implement a thoughtful and proactive approach to tax planning and management that helps our clients keep more dollars in their pockets. This is a year-round job and not one that can be done effectively just before Tax Day. From there, we help our clients with the money that does stay in their pocket to build an investment portfolio that achieves their goals and priorities, while expanding their wealth. We also work with our clients to identify the causes that matter most to them and leverage the gains in their portfolios to make charitable gifts while reducing their future tax liabilities. Our integrated process magnifies the wealth of our clients while protecting and achieving the priorities and goals that matter most to them. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (714) 504-7689 to join our new AWM Insights Network. Episode Highlights 0:00 Intro 0:40 Maximizing net income to fully capture your human capital and magnify your impact 2:53 How Gifting can reduce your future tax liability 6:05 How to think about Lifestyle spending when it comes to your net wealth 8:32 Investing excess funds to expand your wealth 10:15 How do your stock investments generate passive income? 11:53 Text us!
Fri, August 25, 2023
Keeping Investment Returns in Your Pocket | AWM Insights #167
Being a diligent, long-term investor is a very rewarding proposition, but most investors ignore the impact that taxes can have on their investments and what they get to “take home.” Our industry is almost solely focused on total returns and fixates on specific return figures, but those numbers don’t tell you what you get to keep, which is what really matters. Ignoring this dynamic and not proactively working to reduce returns that are lost to taxes can corrode wealth and complicate your journey to building multi-generational wealth. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (714) 504-7689 to join our new AWM Insights Network. Episode Highlights 0:00 Intro 1:01 What tools can we use to reduce and defer our tax liabilities? 2:33 Why are after-tax returns so relevant? 5:28 Why an integrated and multi-faceted investment and tax team is so important. 7:39 How can you tie your charitable interests with tax efficiency? 10:15 Why tax planning is a year-round responsibility. 11:13 Text us!
Fri, August 18, 2023
How to Think About Income – The Types, Sources, and Tax Implications of Each | AWM Insights #166
We continue our series on the Multi-generational Wealth Formula. This week, we focus on income - the most common types and sources, active versus passive income, and how they are treated differently for tax purposes. The most common source is typically called Employment Income or W2 Wages. This income comes from work you do as a formal employee of a company. Athletes are paid Employment Income from the team they play for. On the non-athlete side, founders, senior executives, and employees are typically paid their salaries this way. This income can be subject to the highest tax rates. Any off-the-field income (endorsement income, etc.) is considered self-employment income, independent contractor income, or 1099 Income. Non-athletes can earn this through consulting work or other types of independent work. It is paid as though you are your own business, which has its benefits and drawbacks. There is certainly more flexibility for tax planning but more responsibility to make sure taxes due are paid on time. The last category we discuss can be broadly thought of as investment, or passive income, and there are a few different sources – interest income, dividends, and capital gains. Rental income would also fall into this category. These income types are typically generated from an investment portfolio and the tax treatment varies widely. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (714) 504-7689 to join our new AWM Insights Network. Episode Highlights 0:00 Intro 0:24 A quick review of what we’ve covered in the series so far 0:44 What are the different types of income & how are they taxed? 1:11 Employment income or W2 Wages 2:02 Self-employment income 3:02 Investment, or passive, income 5:47 What's the tax treatment of these sources? 7:04 Benefits of capital gains and the compounding effect 7:34 Text us!
Fri, August 11, 2023
Maximizing Your Physical, Intellectual, & Social Capital | AWM Insights #165
Understanding the different types of Human Capital is critical to building multi-generational wealth. The three main types are Physical, Intellectual, and Social Capital. Each plays a role in building wealth and leading a more flourishing life. Your Physical Capital is your strength, your natural talents, and your ability to stay healthy. All of which are big drivers of wealth for many of our clients. Investing in it – optimizing strength & conditioning, eating well, getting enough sleep, etc. – will pay dividends. For founders of companies, Intellectual Capital is typically their main driver of growth. Athletes can also use this to be a smarter player. Intellectual Capital is not just your academic accomplishments, rather it’s the accumulation of life experiences, formal and informal education included, and self-reflection that typically advance this form of Human Capital. Social Capital can stand on its own or be a very strong complement to both Physical and Intellectual Capital. It is not just expanding your community and network for your benefit. While that’s important, Social Capital can also be giving back to your community or causes you care about. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (714) 504-7689 to join our new AWM Insights Network. Episode Highlights 0:00 Intro 0:35 Money is a tool to use in order to accomplish your priorities 1:16 What is Intellectual Capital, and how do people use it? 3:21 Social Capital, not just networking 4:32 Yes, you should invest in your Physical Capital! 5:15 Invest in all aspects of your Human Capital 6:05 Think about diversification and the evolution of each over time 7:43 Text us!
Fri, August 04, 2023
Expanding and Protecting Your Sources of Wealth | AWM Insights #164
Capitalizing on your Human Capital is essential. Capturing the three main branches of Human Capital (Physical, Intellectual, and Social Capital) in a comprehensive and tax-efficient manner is the starting point for building wealth. From there, this acquired needs to be strategically used to work for you. Warren Buffett famously said,  “If you don't find a way to make money while you sleep, you will work until you die.” Establishing a plan to maximize your Human Capital and put it to work in the most effective way for you and your goals is how Multi-Generational Wealth is built, preserved, and expanded. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (714) 504-7689 to join our new AWM Insights Network. Episode Highlights 0:00 Intro 0:55 Human Capital and the three distinct segments of it. 2:56 Maximizing your Human Capital and the importance of focusing on tax efficiency 4:09 Utilizing your capital to accomplish your goals 5:49 Setting up your portfolio to cover your priorities and expand your wealth 7:25 Syncing your portfolio with your life 9:00 Text us!
Fri, July 21, 2023
Riding the Public Market Rollercoaster | AWM Insights #163
Last October when Equity Markets bottomed out, there were calls to sell and warnings that market conditions would only get worse with rampant inflation and a weakening economy. With the recent positive performance of most Public Equity Markets, you may be noticing that the trend to invest and take risks is now “in” again. Markets fluctuate, and although these swings may lead to emotional responses, even on the upside, investors must tune out the noise, ride out the waves, and focus on their mission. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (714) 504-7689 to join our new AWM Insights Network. Episode Highlights 0:00 Intro 0:41 What has happened this year and what’s to come? 3:33 Accepting volatility and not reacting to the noise. 5:25 How the wrong advice from the “experts” can impact your wealth. 6:49 Why we build portfolios for the long haul. 9:53 Text us!
Fri, July 14, 2023
Putting Your Cash to Work | AWM Insights #162
With short-term interest rates currently hovering above 5% and inflation remaining elevated, the proposition of holding too much cash can be a costly one. Cash gives investors security, immediate accessibility, and certainty as there are FDIC assurances that prevent total losses, but the cost of those elements is missing out on having that money work for you. Checking accounts still have very low-interest rates relative to what can be realized in the fixed-income markets, and no one gets paid to store cash under their mattress. Being intentional with cash balances and making sure your money continually works for you is a small way to continue to build and own your wealth. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (714) 504-7689 to join our new AWM Insights Network. Episode Highlights 0:00 Intro 0:41 The Importance of Cash Management 2:42 The Behavioral element of holding cash and a protective reserve 4:40 Inflation’s Impact on Cash 6:19 Why the current interest rate market is attractive and rewarding investors that hold less cash 7:55 What about CDs? 9:53 Text us!
Fri, June 30, 2023
How to Evaluate your Portfolio’s Performance | AWM Insights #161
Taking the time to review your portfolio’s performance is a great exercise, but it’s important to use the right tools and methodology to carry out an accurate evaluation. It’s also critical to remember that everyone is playing a different game with different starting and ending points. This fact makes the standard returns you see online or on TV relatively important, but not the absolute target. As our portfolios are custom-made to fit each client’s priorities, no singular benchmark or data point can give you complete context on how you’re performing or doing. The most meaningful metric will always be how likely you are to accomplish your goals and priorities. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (714) 504-7689 to join our new AWM Insights Network. Episode Highlights 0:00 Intro 0:25 How should you start thinking about your portfolio’s performance? 2:32 One index is not enough to measure your portfolio’s relative performance 3:30 Why a custom portfolio approach needs a different method of performance evaluation 5:19 What indexes do we use to compare ourselves and how do we think about the results? 7:25 Why being a long-term investor is a rewarding rollercoaster 10:13 Text us!
Fri, June 23, 2023
The Importance of Behavioral Finance | AWM Insights #160
Understanding, processing, and regulating emotional responses toward your investments is one of the most important skills to have in order to be a successful and diligent investor. Markets give us various inputs that lead to an array of feelings, but it is critical to process and regulate your emotional responses at all times and keep your eye on the bigger picture, which is your financial structure. Trends come and go over the years. True multigenerational wealth can be everlasting if structured and implemented properly. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (714) 504-7689 to join our new AWM Insights Network. Episode Highlights 0:00 Intro 0:25 How do human emotion and behavior tie into investing? 2:45 History of the public stock market 4:22 Why the behavioral element of finance is just as important as the technical side 5:19 Why a robust understanding of markets helps investors over the long run 7:38 Being disciplined across market cycles 9:30 Managing your feelings and being diligent while looking at the bigger picture 11:00 Text us!
Fri, June 16, 2023
Patience and Persistence in the Markets | AWM Insights #159
The S&P 500 is up more than 20% since it hit its low last year. Market conditions have improved since then with CPI inflation coming in at 4%, and the Federal Reserve pausing rate hikes this week. There is a huge lesson to learn from the market’s short-term performance. Patience and persistence are key to any investor’s long-term well-being, and those qualities are rewarded. Markets are forward-looking, and even though conditions may have looked gloomy 8 months ago, withdrawing from the market and waiting it out on the sidelines would have led to missing out on the rally that we just witnessed. Timing markets and playing the guessing game usually leads to missing out on these great periods and causes a high level of stress and friction. Patience and persistence can save you from that! Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (714) 504-7689 to join our new AWM Insights Network. Episode Highlights 0:00 Intro 1:20 What is happening and driving markets? 3:45 Why predicting markets is a dangerous game to play 5:15 How a systematic investment approach helps you capture returns in an efficient manner 7:55 Why diversification and patience in the public and private markets reward investors 9:05 Why the guessing game is the wrong game to play 11:40 Text us!
Fri, June 09, 2023
The Importance of Consistency and Repeatability in Venture | AWM Insights #158
As we wrap up our series on Private Markets and Venture Capital specifically, it’s important to highlight why Venture has been so impactful in building multigenerational wealth. Historically, Venture Capital as an asset class has had remarkable returns due to its positioning on the cutting edge of innovation. Returns always come from and with risk, but the long period of illiquidity, uneven returns, and the J curve that is usually witnessed can be risk factors that are mitigated with a strong financial structure and a systematic, consistent, and repeatable approach. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. Episode Highlights 0:00 Intro 0:50 Why has Venture been such a powerful asset class for building multigenerational wealth? 3:46 Why does your Venture allocation need to be systematic and repeatable? 7:23 How do we set our Venture Portfolio up for success? 9:16 Why do consistency and diversification help us capture higher expected returns? 11:00 Text us!
Fri, June 02, 2023
How to Build a Best-in-Class Venture Portfolio | AWM Insights #157
Constructing a well-diversified portfolio is very similar to building a well-rounded baseball team. Assets must be distributed between current players and prospects to field a strong lineup while also investing in the future to fill any foreseeable gaps and improve key positions. Venture Capital aligns closely with the logic of investing in prospects. The benefit is deferred, but if done correctly, there may be outsized returns and general production relative to the initial investment outlay. This must be carried out systematically and diligently to maintain the balance between the present and the future and optimize short and intermediate-term competitiveness while also reaching for a brighter future. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. Episode Highlights 0:00 Intro 0:45 How do we build out and structure our Venture Fund 3:16 Why it makes sense to diversify across stages? 5:13 How do we determine what funds and fund managers we invest with? 7:53 How does our dynamic and consistent approach give us more quality at-bats? 9:25 How fund size impacts the investment process and returns? 10:46 What expected returns and outcomes are we targeting? 12:40 Text us!
Fri, May 19, 2023
Selecting the Best Opportunities in the Private Markets | AWM Insights #156
Tens of thousands of Private Equity and Venture Investments are made every year. How can you sort through these opportunities in thoughtful ways to isolate and get in front of the best of the best? Private Markets are not as transparent as their public counterparts, which adds to the complexity of making investment decisions, but also creates opportunity. Building relationships with standout companies and operators gives insight into the most exciting prospects and can give investors the inside track to “win” deals. From there, expert managers add value to their investment companies by helping with operations, expansions, and exit strategies. This is why who you invest with is just as important as what you invest in. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. Episode Highlights 0:00 Intro 0:45 How do we source and filter through Private Market Opportunities? 2:56 What are our first steps to Evaluate an Opportunity 4:01 Sourcing, Selecting, Winning, Exiting 7:25 How the distribution of Venture returns impacts our investment framework 8:10 Differences in Perception in the Private Markets 9:40 Our Ultimate goal is to help you accomplish your priorities 11:30 Text us!
Sat, May 13, 2023
How do we build our Venture Portfolio? | AWM Insights #155
Private Markets, and specifically, Venture Capital, appeal to investors as they offer outsized returns for those that can accept illiquidity and risk. After we work through those factors for a client and build a dependable financial structure, how do we invest to maximize your opportunity for success? We are always present in the Private Markets, meeting with fund managers and business operators to identify the best opportunities and stay top of mind for future ventures. Our annual fund structure, presence, and persistence keep us relevant. There are also segments of the Private Markets that have tactical advantages that we leverage. Known and successful operators have access to the best deals, smaller funds are more agile and can snap up opportunities quickly, and earlier-stage companies give us better entry valuations and hopefully longer runways for capital appreciation. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. Episode Highlights 0:00 Intro 0:55 Our systematic approach to investing in Private Markets 3:10 Applying our methodology 5:20 How do we build our Venture Portfolio? 8:10 What factors do we look for and how do we structure our fund? 9:51 Text us!
Fri, May 05, 2023
Accessing the Private Markets | AWM Insights #154
Private Markets are not open to all investors. There are minimum thresholds that need to be met to qualify individuals to invest in this space. These rules are set to protect smaller, less sophisticated investors from the challenges and complexity of the Private Markets. On top of the regulatory requirements are implicit hurdles. In Venture specifically, having the funds to invest is not enough to access the best managers and get a seat at the table. Our Multi-Family Office structure and commitment to networking give our investors strength in numbers and enable us to access the highest quality private offerings. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. Episode Highlights 0:00 Intro 1:28 What is Liquidity and how does it impact Private Investments? 4:45 Why your financial structure needs to be dialed in to invest in Private Investments 6:35 What requirements are needed to invest in Private Markets? 10:13 Why Access matters so much? 14:01 Text us!
Mon, May 01, 2023
Private Market Basics | AWM Insights #153
Private Markets represent a broad range of asset classes and opportunities for investors. Historically, the best-performing segment of Private Markets has been Venture Capital, which has also significantly outperformed public markets. Investing in highly innovative companies early in their life cycles is a risky proposition, but if this strategy is implemented correctly, aligned with your financial structure, and the proper Due Diligence is done, it puts you in a position to potentially realize outsized returns. These are the companies that will be household names in 5 to 10 years, and investing in them now not only improves your expected return but also propels our country and economy forward. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. Episode Highlights 0:00 Intro 0:50 Why do we invest in Private Markets? 3:10 Why do we invest in Venture Capital specifically? 4:25 What do historical Venture Capital returns look like compared to Public Equity market returns? 7:10 Investing in Venture Capital with a multigenerational mindset. 8:14 The Impact of Investing in Venture Capital. 9:55 Expanding your network and growing your Net Worth through Physical, Intellectual, and Social capital. 12:10 Investing in the most innovative companies. 14:01 Text us
Fri, April 21, 2023
The Multigenerational Mindset | AWM Insights #152
Athletes and Founders are playing a different game that has its own unique rules and boundaries, from your unorthodox career path and service time to the magnitude of impact your earnings can have. With the distinct nature of your lives, it is vital to take these rules into account and use them in your favor to maximize your impact. In many cases, this leads to establishing wealth that will outlive you. This enduring influence must be built around what you value and prioritize and be guided to adapt to the known uncertainty of tomorrow. This episode touches on how we build portfolios with a multigenerational mindset, and why we use your individual goals as the backbone of your financial structure to create a precision and robust solution that gives you the confidence to succeed. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. Episode Highlights 0:00 Intro 0:40 What do we do when building custom portfolios and why is our process different and more complex? 3:33 How do we break out each of your priorities to create a precise portfolio? 4:45 How the level of importance of a priority changes the assets and strategies we use? 5:47 Having a multigenerational perspective changes portfolio construction 7:33 Precision leads to confidence 9:29 Planning helps you capture the illiquidity premium while avoiding cash crunches 10:10 Text us
Mon, April 17, 2023
The US Dollar and Economy | AWM Insights #151
The Dollar became the International Reserve Currency in 1944 to establish a common medium of trade in a war-torn world. Since then, the Dollar has been trusted by non-US countries to settle transactions for goods, commodities, and services due to its stability, predictability, and broad usage. In recent years, larger countries around the world have been looking to settle transactions in their own currencies. We discuss the implications of these moves and how it affects the companies you are invested in and your portfolio. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. Episode Highlights 0:00 Intro 1:03 The US Dollar’s role in the Global Marketplace 4:33 How will Equities perform in a dynamic and evolving currency regime? 7:31 How do interest rates, debt issuance, and trade deficits impact currencies? 9:22 Do shifting factors and forces in currencies impact your returns? 10:24 Why managing volatility and matching your assets to priorities gives you certainty in any environment. 14:10 Text us
Fri, April 07, 2023
The AI Wave and How It Impacts Your Portfolio | AWM Insights #150
AI is today’s buzzword, and for good reason. OpenAI’s release of ChatGPT to the public has started a wave of creativity in applications for the broad tool. It has started disrupting major fields and industries from education to programming, and we are still in the infancy stage. As promising as any new technology can be, it is important to be diligent and stay true to the fundamentals of investing. Crypto and the Dot Com bubbles are great examples of this. This technology has a very strong probability of changing our lives and impacting the global economy, and the best way to improve your probabilities of reaping the rewards from AI is to stay diversified, maintain exposure to current players and add new entrants, and stay disciplined. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. Episode Highlights 0:00 Intro 0:31 AI’s impact on our industry and how we are qualifying this investment theme 1:39 Maintaining diversification is fundamental 2:58 Why it's important to be cautious while new technology is in its infancy phase 4:28 Do globally diversified investors already have AI exposure 6:20 What happens to trailblazer companies and do they have the best chances to succeed? 8:29 Private Markets will also cover the new opportunities in AI
Fri, March 31, 2023
The Basics of Private Market Investing | AWM Insights #149
Private Markets come with a very different set of challenges and rewards when compared to Public Markets. Unlike the Public Markets, there are requirements that need to be met for investors to be able to access Private vehicles as they are illiquid. Private Markets are also much less transparent than their public counterparts and, for that reason, require significantly more due diligence. There is a large dispersion of returns between Private Market funds due to expertise and manager’s skill, which is not true of Public Markets. Access to these best-in-class managers is very competitive and cannot always be obtained with “just a check”. All these dynamics make it extremely important to work with a trusted and experienced advisor when thinking about allocating to the Private Markets. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. Episode Highlights 0:00 Intro 1:40 What are Private Markets 3:04 How Venture Capital and Private Equity fit into Private Markets 4:50 Differences between Public and Private Markets 7:54 Who can invest in Private Markets 9:03 Money alone isn’t enough to get access to the best funds 10:50 The logic behind limiting participants and access in Private Markets 12:06 Why vintage diversification is so important 13:24 Why would you want to participate in Private Markets? 14:00 Text us
Fri, March 24, 2023
Building Resilient Portfolios | AWM Insights #148
Markets rarely move sideways without fluctuations. Although we may want a smoother path to success, fluctuations and volatility are signs of health in the financial markets and give investors the returns they seek over extended periods of time by weeding out short-term investors and “nervous capital”. Our role as caretakers of your financial well-being is to create a portfolio that meets your needs, helps you achieve your goals, and weathers the market turbulence to come while keeping you invested and at peace. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. Episode Highlights 0:00 Intro 0:48 Why we build portfolios to weather periods of volatility and give you confidence in times of stress 2:47 How creating custom portfolios that are tailored to your needs keeps you away from unnecessary risks that can be found in many cookie-cutter model portfolios 5:14 Why volatility in fixed income positions is not relevant with tailored portfolios. 6:54 How much attention should you give to your portfolio? 7:45 Why volatility isn’t always a bad thing 9:10 How we ensure that clients have what they need when they need it and are rewarded for what they defer 12:02 Why it is so important to be allocated properly 14:10 Text us
Sat, March 18, 2023
How Doing the Simple Things Wrong Can Be Disastrous | AWM Insights #147
It has been a news-filled last few weeks, to say the least! On a positive note, the silver lining that is evident through the turmoil is that many of these issues can and should have been prevented through the use of proper financial logic and principles. Whether it was diversification, fixed income management, or market timing, it is clear that going against what we know to be true does not work out. Having a robust financial framework that is built around the rules of the markets is the only way to build and protect multi-generational wealth. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. Episode Highlights 0:00 Intro 0:43 Update on current events and financial climate. 2:50 What is a bank run and how did it happen 4:45 How SVB’s mismanagement of their portfolio lead to unacceptable risk 6:45 Why we manage bond portfolios to protect against interest rate risk 9:10 How we ensure client portfolios are safe and how do we think about cash 9:45 How we optimize and protect your cash and safe assets 11:40 Venture Update after the issues with SVB 13:30 The power of diversification and why it becomes important during times of stress 14:50 Text us
Fri, March 03, 2023
Rewarded Factors and Outperforming the Market | AWM Insights #146
Rewarded factors have been integral for investors that seek to outperform the market. Instead of guessing and making stock picks, the use of these factors has beaten indices and stock pickers while keeping costs low and staying more tax efficient than active managers. Incorporating more small, valuable, and profitable companies into your stock portfolio over long periods of time takes advantage of efficient risk that pays off and can supercharge multigenerational returns. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. Episode Highlights 0:00 Intro 1:35 Our general thoughts on Equity management 2:20 How do we try to outperform active managers and indexes? 3:27 Characteristics of companies that outperform in the market. 5:08 How being a long-term investor helps you capture these rewarded factors. 7:15 These rewarded factors are proven across different time periods, regimes, and markets. 8:32 What does 2% of outperformance means in terms of the magnitude of wealth 9:31 How early planning can make huge impacts on your multi-generational wealth 11:09 How we add rewarded factors to your portfolio 12:45 Text us
Fri, February 24, 2023
The Logic Behind Your Stock Holdings | AWM Insights #145
Diversification is a key pillar of financial success. Owning as many companies as you possibly can position your portfolio to pick up returns from generational performers, and increases your odds of not missing out on these best-in-class companies. This concept makes its way into Global Markets as well. Maintaining exposure to different economies and regions with different industries increases your odds of success, and potentially can smooth out yearly returns. The old adage of not putting all your eggs in one basket holds true here and usually leads to you having more eggs at the end of the day. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. Episode Highlights 0:00 Intro 1:35 What do we look for while conducting research? 3:33 What is Global Market Capitalization and why do we use it as a starting point? 4:30 Diversification and why we still invest internationally during times of unrest. 5:58 Why do we use confidence in outcomes over any single arbitrary figure? 6:45 Why are we slightly overweight Domestic Companies and have a home bias? 7:56 What do active managers think about their funds and how do they invest their own money? 9:31 Pros of Passive investing over Active management. 11:09 General Structure of our implementation. 12:31 Text us
Fri, February 17, 2023
Focusing on What Matters and Tailoring Your Portfolio | AWM Insights #144
Your portfolio’s purpose is to be used to accomplish the goals that you value. This can range from lifetime spending, paying for schooling, buying property, and passing down wealth to future generations. These goals all come at differing times and with varying levels of importance based on what you prioritize. Your portfolio needs to be built around these goals as money is the tool that helps you accomplish them. This process is complex and involves communication back and forth, but it ultimately builds a financial foundation that gives you the highest level of confidence to achieve what you set out. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. Episode Highlights 0:00 Intro 0:38 How do we actually allocate your portfolio 2:03 Your most important priorities are the foundation. 3:10 We focus on your needs and what actually matters in your life 4:35 Why off-the-shelf portfolios lead to returns being “left on the table” 5:37 How public markets generate passive income 6:43 How do we use your excess funds to generate the returns you deserve 8:15 How investing globally smooth’s out returns and leads to higher confidence in long-term returns 9:59 The stats behind experts like Jim Cramer 12:31 Integrating diversification and rewarded factors to your benefit 14:40 Text us!
Fri, February 10, 2023
The Importance of Protecting What You Need and Risking What You Can | AWM Insights #143
In markets, risk and return go hand in hand. The more risk you can take with your portfolio, and the more time you can leave money invested in markets that generate a risk premium, the higher your expected return will be. Even through periods like the dot com bubble and the Great Recession, long-term risk exposure was not punished, it was actually rewarded if you stayed invested through all the chaos. If too much of your money is exposed to risk and markets hit a period of turbulence, there may be a loss of capital, but expertise in management can shield you from these times of market turmoil. It may sound very simple, but the process of properly thinking through your priorities and figuring out what you need now, and what you can do without until later, ends up generating a great deal of wealth over your investment life cycle and keeps any market hiccups from interrupting your day to day life. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. Episode Highlights 0:00 Intro 1:03 How do we evaluate the news and updated financial data? 3:23 Are all trends important and what are we looking for? 4:21 Differences between evaluating data as it relates to public and private markets 6:00 How we use your general financial structure to create building blocks that enable you to seek outsized returns in the private markets 7:37 Thinking through your most important factors and goals, and using those to properly tailor your portfolio 9:13 Matching your priorities with assets that help you achieve your goals, and also achieve the highest expected returns 10:45 How your savings and discipline early on in your career can lead to the best chances of achieving exceptional returns 12:09 Protect what you need and risk what you can 12:40 Text us!
Fri, February 03, 2023
How Robust Planning is Positioning Your Portfolio for Success | AWM Insights #142
As new economic data is reported and forecasts are updated, it’s easy to get lost in the constant flow of information. You will hear things from just about every source out there. But does it matter? What info is important to pay attention to? As entertaining as markets can be, it’s imperative to remember that markets serve you. It’s not the other way around as the rest of the industry sometimes presents it. Taking your situation, priorities, and needs FIRST, and then factoring in market information is the only way to confidently achieve your goals. Removing step one or pushing it down the list only leads to a less personalized approach that will not give you the same level of certainty as a robust and tailored solution. You deserve to have a strategy built around you and what truly matters in your life. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. Episode Highlights 0:00 Intro 1:17 What is a Soft Landing and how would that impact markets 3:38 Why timing and predicting the impact of data doesn’t work and is the wrong game to play 4:06 How AWM builds portfolios for your success in a more robust and tailored way than the rest of the industry 6:32 Why building portfolios in this fashion gives you true confidence of success 7:51 What do proper planning and portfolio construction lead to 9:15 Why it “pays off” and gives clients peace of mind to implement this complex framework 12:10 Text us!
Sat, January 28, 2023
Happy 30th Anniversary to Efficient Investing! | AWM Insights #141
Exchange-traded funds (ETFs) were first launched on January 22nd, 1993 and have helped investors of all sizes save money on fees, diversify their portfolios, and reduce their annual tax bills. The structure and operating process of the ETF paired with a diligent, diversified, and rules-based investment approach enables investors to hold extremely efficient portfolios that could previously only be constructed with 100s of millions of dollars. We touch on the most important principles and themes to know about ETFs as well as some current events around tech layoffs and why they may not be as negative as they seem. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. Episode Highlights 0:00 Intro 0:35 Anniversary of the ETF 0:58 What do we think about the recent Tech and Banking layoffs? 2:50 What lead to some of these layoffs? 4:48 The silver lining of the Tech layoffs 6:34 How layoffs and market cycles relate to your portfolio, general diversification, and positioning. 8:01 Benefits of diversification and how ETFs help 9:40 What do ETFs enable you to do? 10:22 The positive attributes of ETFs and how they help you save money on fees and taxes. 11:55 Wrap up
Fri, January 20, 2023
Financial Statements and What Really Matters | AWM Insights #140
Does evaluating financial statements for publicly traded companies lead to better returns? This may seem like a simple question on the surface, but understanding the magnitude of the question is important. There are roughly 60,000 publicly traded companies worldwide according to the World Federation of Exchanges. A company, like Apple, generates a summary of financial performance in a document called a 10K that has 80 pages, 1000’s of data points, and countless footnotes to qualify the data (as different companies report on metrics in different ways.) That information is also mainly backward-looking, and only relevant for a short amount of time in our ever-evolving world. What you are left with are billions of numbers that don’t relate to each other. Also, there has been no proven method of using any of these figures for consistent returns. All of this may seem stressful (and it is), but it can also be harmful if it takes attention away from the most important elements in your financial life, your structure and plan. Focusing on your plan, lifestyle, and the factors you can control will lead to far more benefits than looking at Apple’s Commercial Paper holdings. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. Episode Highlights 0:00 Intro 1:01 Do we read financial reports and try to value companies based on fundamentals? 2:00 Public vs. Private Market Dynamics 2:46 Recent Rally was a result of the market repricing interest rate expectations 4:26 Trying to be an active manager and outguessing the markets has been shown to be impossible to do consistently 6:13 What an active manager believes and how it would relate to a company (i.e. Tesla) 8:14 What is a relevant baseball example for being an active manager 9:13 There are different elements, themes, and dynamics in Public and Private markets 11:15 Going through fundamentals and the data is more productive in the private space 12:47 Wrap Up
Fri, January 13, 2023
2023 Kick-off | AWM Insights #139
Welcome to 2023! The New Year is always a natural time for reflection. We looked back on the year that was in our last episode. In this week’s episode we take a look forward and set some foundational expectations for the year ahead, whatever it may bring. The big topics in the financial media at the moment are 2023 predictions. And they are just that, predictions! No one has a crystal ball and no one seems to be able to predict the future with any certainty. So while it is certainly a fun exercise and a great topic over a beer or glass of wine or other beverage of choice, history shows you should definitely stop there and rely on a systematic, long-term approach to managing and building multi-generational wealth. Just remember markets tend to fool most people most of the time and we’ll talk through ways to avoid this As we enter 2023, it’s important to remember that we view money as a tool to accomplish your priorities. We want to intentionally allocate your money in a way that supports what is most important to you. As such, we structure portfolios and your net worth in a way that increases the likelihood of success and minimizes the impact of chance on your outcomes. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. Episode Highlights 0:00 Intro 1:05 How do we think about predictions? 1:19 What we are thinking about going into 2023 2:32 Markets are positive on an annual basis about 75% of the time 2:52 2022 validated some of our thinking 3:25 Flashback to Dec 2019, who would’ve predicted where we are today? 4:42 It’s natural to think we can outguess markets but reflection helps remind us what actually works 5:11 You don’t have to play the prediction game to succeed 6:59 The importance of Bonds in a portfolio 7:50 Markets fool most people most of the time 9:35 Focus on meeting your priorities in the highest probable way 10:18 Humans are wired for short-term gratification 11:53 Wrap up
Fri, January 06, 2023
Year End Review: 2022 | AWM Insights #138
2022 has been a rough year for investors and brought in a long list of exceptional events. Meltdowns in SPAC’s and Crypto, an energy crunch, rising interest rates, and an unprecedented war overseas lead to market reactions and financial turbulence. Most Equity and Bond indices finished the year in the red. The S&P 500 also snapped a 3-year winning streak of double-digit annual returns. Losses are never ideal, but it is important to reference history and understand how market performance affects your portfolio and overall financial well-being. The S&P 500 has a “record” of 71-26. Over the past 97 calendar years, 71 have been years with positive returns. The average return during a positive year was 21% while the average return during a negative year was -13%. The skew and magnitude of returns are in the favor of the investor and working with a team that properly positions your portfolio to capture the upside while also protecting your priorities is essential to both participate in the market and achieve your goals. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. EPISODE HIGHLIGHTS 0:00 Intro 1:01 Year-End Review 1:29 How accurate were the predictions for 2022 returns from the “Experts” 2:13 Emotional responses to volatile markets 2:38 Notable events in 2022 4:43 Has a recession been declared 5:44 How are we positioning our portfolios for the future given the turbulence 7:06 Controlling what we can control, and how we used volatility to our advantage with Tax Loss Harvesting 8:14 Interest Rates movements and their impacts on your financial structure 11:08 How interest rates affect Equity markets 11:53 Why paychecks during downturns are a huge positive 12:25 Markets pivoting on new information and fed stance 13:25 Key Takeaway 1: Don’t let short-term news derail your long-term plan 14:03 Key Takeaway 2: Is your fixed income allocation working in the right way for you? 14:35 Key Takeaway 3: Global Diversification 15:01 Key Takeaway 4: Markets are forward-looking, and they consider investor sentiment 15:40 Predictions for 2023 16:55 Wrap Up
Mon, December 19, 2022
FTX, Inflation, and Navigating Hype Cycles | AWM Insights #137
Tailoring a portfolio to your needs is very similar to designing and constructing a home for you. A general plan needs to be established based on how many rooms are needed, what style and functionality are desired, and what amenities and extras can fit in the most optimal and seamless way. It takes communication for the architect and designer to understand what is needed, and a plan needs to be drawn up to execute on those requirements. Your portfolio is constructed in a similar fashion. Your most important priorities are used to sculpt the foundation, and the placement of rooms, amenities, and features flow from this foundation. A thoughtful approach ensures that you have everything you need and that you don’t run into any shortcomings in the future. Planning and intentionality separate a portfolio that works for now from one that will work for the rest of your life to achieve your purpose. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. On an iPhone? Click HERE to join. EPISODE HIGHLIGHTS 0:00 Intro 1:09 Inflation- Does it matter and how are we navigating through it 2:30 What can we do to outpace inflation 3:56 How to insulate your portfolio against inflationary pressures 6:18 Why taking a purpose-driven approach makes life less stressful and improves your odds of achieving your goals 7:33 FOMO in the crypto world, News around SBF 9:35 How do we evaluate risky opportunities, and why due diligence matters 12:01 Governance and red flags with FTX 12:43 Involvement and Endowments with Athletes and Celebrities 13:47 What do excess resources mean to you 14:15 Hype Cycles 15:45 Key takeaway- Ask questions, do your research, take an appropriate level of risk 16:57 Wrap up
Tue, December 06, 2022
Is a Recession Coming? | Insights #136
It often seems like the world economy is not prospering, but instead heading toward a recession. Negative news frequently dominates headlines, and it tends to catch the attention of investors more than its positive counterpart. The unfortunate reality is that optimism is rare and hard to come by. If we went off headlines and article punchlines from the last two decades, we may think that the economy regressed. From the tough times in 2008 and the fall of financial institutions to 2020 when there was genuine concern that civilization as we knew it might collapse. Headlines were there to warn about the storm to come, but there was little thought given to what would happen afterward. The peak of every negative news cycle produces the most fear and worry, and tends to be the time when winners and losers are determined. Those that accept losses at market lows and sell out do not participate in the recovery rallies to come, and those that are resilient and hold a long-term investment horizon are rewarded. Over the past 20 years, the S&P 500 has returned a cumulative 335.62%. That is the reward for weathering the storm. EPISODE HIGHLIGHTS (0:00) Intro (0:59) Thoughts on the talk of Recession and how to actually think about it. (1:49) Recissions and the general relationship between the market and economy (2:58) Predicting the future, relevant news, and news cycles (3:57) Using information and trading on it, how does it pay off? (4:21) Interest rates and trading on assumptions (4:50) Long-term steady approaches improve your odds of success (6:10) Short-term trading, why it just doesn’t work (7:45) Portfolio construction, keeping you invested and protected (8:39) The right question to ask about portfolio construction (9:18) Health and Financial Health (11:03) Takeaways: Media, Economy, Dinner Convos (12:10) Consistency is key (12:20) Wrap Up
Sat, November 12, 2022
Two Simple Principles to Investing Success | Insights #135
We all have our dreams, and while they might not always be realistic, it can be fun to get caught up in the hype of the newest product, market trend, or what you’d do with $2 billion if you won this week’s Powerball, it doesn’t always pan out. However, what if you were told that some of your wildest dreams could be achieved with two simple secrets? Discipline and diligence. Hype cycles can challenge any investor to stay disciplined and diligent. It is very easy to be overly optimistic and see a short path to your dreams becoming reality. A path does exist, but it requires the two secrets mentioned as well as a knowledge of financial market principles and fundamentals that govern the laws of that road. They may not always be the strongest (or most exciting) forces in the market, but history has shown that they are the only tried and true tools that can be used to achieve your dreams and do so in a highly probable fashion. On this episode of Insights, we highlight current events, including how many quickly accumulated fortunes over the past few years were lost overnight due to an overdose of optimism and a deficiency of discipline and diligence. Episode Highlights: (0:00) Intro (1:07) Current Events (2:56) Surprise Inflation Reading (4:25) Earnings Readings and Adjustments (6:25) Crypto market activity - FTX (7:27) Recession and Market Pricing (8:45) Takeaways (13:04) If it sounds too good to be true… (13:25) Don’t forget that Fundamentals Matter (13:55) Wrap up
Sat, October 29, 2022
Why Your Portfolio Can Beat the Competition | AWM Insights #134
As a pro athlete or successful businessperson, you have heard this statement a thousand times, “control what you can control.” Why? It’s because every fiber of our being wants to react to the “noise” good or bad. We are easily caught up in the emotion of an event or views of the crowds. This is where the pros are separated from the amateurs. The amateur reacts to what’s happening outside of themselves. Typically, rewarding themselves with feelings of comfort. Yet, the pro resists. They know it’s all a distraction. A pro is only concerned with what they can control. They choose to suffer through the feelings of doubt and discomfort. Investing is no different. Few will earn the returns they deserve. What can you control? A negative market provides one of the greatest tools to maximizes your long-term after-tax returns.
Fri, October 21, 2022
How Your Portfolio Is Built To Win During Bad Markets | AWM Insights #133
The S&P 500 is down ~23% year-to-date which has felt like an exhausting marathon. Would you believe us that the -23% return has been created by only nine days? There are 254 trading days in a market year. It’s a silly exercise but if you had the ability to avoid those nine days, you'd actually be up 9% year to date in the S&P 500. Unfortunately, these were not nine consecutive days. And more importantly, avoiding the worst days means you risk missing out on the best days all but guaranteeing you destroy your long-term returns. From 1/3/2000 – 4/9/2020: Six of the seven best days occurred after the worst day. Seven of the ten worst days were followed the NEXT DAY by either top 10 returns over the 20 years OR top 10 returns for their respective years. Given this reality, if someone leaves the market after experiencing a poor return, it is literally impossible for them to get invested in time to benefit from the best day that may follow. Over that same period if you stayed fully invested you would have earned 6%. However, if you were to miss only the 20 best days you would have wiped out your entire return. There are 7,398 days over that period. The cost of being wrong is catastrophic. It’s not just that you don’t earn the returns you deserve it’s that you have less money putting at risk your ability to pay for your priorities. It’s why we don’t player a loser’s game of attempting to predict the market. We use the power of data and evidence to build your portfolio to earn higher expected returns and provide you with the highest confidence to achieve your priorities. The key to staying in the market during difficult periods is know your portfolio has been built knowing in advance these periods would come. Listen in to hear how your protective reserve is uniquely customized and the role bonds play in your portfolio.
Fri, October 14, 2022
1,982% Return: Are You Willing to Do What It Takes? | AWM Insights #132
In business and sports, everyone dreams of the payoff. A company that sells for billions and an athlete that signs the big contract. Yet, every owner and athlete who has achieved this will tell you the sacrifice and resiliency it takes to survive the gauntlet of the journey. 1,982% cumulative return over 30 years. 9.2% annual return $1 invested grows to $20.82 We all want the payoff. Few will do what it takes. Are you prepared & willing to? The purpose of investing is to put your money to work and build wealth. The growth potential of investing is primarily due to the power of compounding and the risk-return tradeoff. To capture the returns above you had to stay invested when every fiber of your being was telling you to get out. -49% annual return in 2001 -57% annual return in 2008 -34% annual return in 2020 It’s what I imagine an ironman athlete feels like when they get off the bike to realize 26.2 miles stand between them and the finish line. Returns are not given. They are earned. 2022 is testing our convictions. As of 10/14/2022, the S&P 500 return is -24.43% The most common question is can’t we avoid the pain? Don’t we know what’s coming? For instance, the current inflationary environment won’t last forever. Should we be on the sidelines until things return to normal? Here’s the thing, this time is normal. This is a well-functioning market. It's doing exactly what it should be doing. Lots of uncertainty, high inflation, things are changing, and the markets reacting, all those things are normal. Even if we can reasonably know what the future may look like, markets remain unpredictable in the short term. There are 10,950 days over 30 years. Missing less than .5% of the days can be catastrophic. $1 invested in the S&P 500 on Dec. 31, 1991, and held the position until Dec 31, 2021, grows to $20.82 for a 1,982% cumulative return. However, if you missed the 50 best days, you would only have $1.62. It’s not enough to want to stay invested long-term, it’s having the capacity to do so. The biggest mistake we see amateur investors make is not having an adequate amount of money set aside to provide for their essential priorities (expenses) over the next few years. Without this protective reserve, they are forced to panic and sell out of the market and turn what should be temporary unrealized losses into permanent losses. At AWM, we are evidence-based investors. The history of the markets tells us we should expect short-term periods of temporary declines which is why we build your financial structure with a protective reserve. Your protective reserve allows you the capacity to meet your short-term p
Tue, October 11, 2022
Is A Recession Looming? | AWM Insights #131
We have recently hit 2-year lows on many indexes, and if you have tuned into any financial news offerings lately, you would believe that the worst is yet to come. More interest rate hikes are on the horizon, greater uncertainty remains from the war in Ukraine, and energy prices that continue to rise are leading many pundits and analysts to predict an imminent recession. Are they right, and what should you do? On this episode of insights, we walk you through the recent turbulence, a comeback story in Real Estate, what news is actually relevant in our saturated world, and how changing market conditions should impact your mindset and portfolio construction. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (:bulb:) to Brandon at (602) 704-5574 to join our new AWM Insights Network. Episode Highlights: (0:00) Wine Showcase: Deovlet Wine (1:07) Weekly Market Movement (3:06) Real Estate (4:35) Profiting from News and Opinions (5:25) Complexities Today (7:27) Recession and Market Pricing (9:13) Earnings (10: 11) Tying it all together (12:25) Liquidity and Accessing your money (13:31) Zinger 1 Market Timing (14:00) Zinger 2 Market’s general movement (14:13) Zinger 3 Financial Structure
Tue, October 04, 2022
Is The Market Healthy? | AWM Insights #130
Markets are crazy right now. The S&P 500 was down over 9% for September alone. Interest rates have been marching higher. What does this mean for you and your money? Everyone goes through challenging periods of time whether that's in sports or business. Investing is no different. It is perfectly normal in times like these to be unnerved by market drops and the possibility of a looming recession. Talking it through with your advisor is exactly what you should be doing. For clients, there are three zingers for you to know right now. There are many different kinds of interest rates and they are not all created equal. It is important to know which one people are talking about and whether it should even matter to your personal situation. The best place to be in times of high inflation for long-term investors is equities. Stocks have proven to outpace inflation when you invest over decades. Sitting in cash destroys purchasing power during high inflationary periods like today. Clients with resilient financial structures should feel more confident because markets are healthy and working for you. It affords you the luxury of being indifferent during these times. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. On an iPhone? Click HERE to join. EPISODE HIGHLIGHTS: (0:55) The Fed has increased interest rates and earnings season is around the corner. Should clients be doing anything with how much markets are moving? (1:31) You probably shouldn’t be doing much. But that assumes you have the right financial structure and portfolio already set up. (1:55) This is a healthy part of markets. To get a positive return on your investments there must be a trade-off. The volatility or price movement and range of outcomes that are uncertain is the risk you must be willing to bear. (2:27) Risk is a wide range of possibilities of movements in price. There is a range of outcomes that represents that range of risk. (2:53) Volatility is the price movement. Weathering volatility can be unnerving but it is the price to pay to get returns. (3:43) Everyone goes through challenging periods of time whether that's in sports or business. Investing is no different. (4:05) It is perfectly normal in times like these to be unnerved by markets and the economy. Talking it through with your advisor is exactly what you should be doing. (4:40) The data shows that even if you know where interest rates are going, it wouldn’t help you predict what the market is going to do. (5:36) In the history of the markets, there is no c
Wed, September 28, 2022
What Rising Rates Mean For You | AWM Insights #129
Rising interest rates have dominated headlines for the last few months, but which rate is the most important to you? Should you be concerned? The rate you’ve likely heard the most about is the Fed Funds rate. In short, this is the interest rate that banks charge each other if they need to borrow or lend in excess of their reserves. This rate is set by the Federal Reserve and is the main policy tool used to influence other short-term rates in an effort to cool inflation. Contrary to what you might hear, rising rates does not always mean the stock market will crash or even go down. Past evidence has shown no strong correlation and trying to time the market using this data would be a fool’s errand. Staying the course with your long-term strategy and trusting in your established protective reserve should give you confidence during these times. In this episode of AWM Insights, Brandon and Justin discuss these rising rates, their potential impact on you, and how to navigate market downturns. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. On an iPhone? Click HERE to join. EPISODE HIGHLIGHTS: (0:35) Interest rate talk is dominating headlines. What does that mean for you? (1:29) When you hear about interest rates rising, it's important to ask which interest rate you are talking about. Usually, people are talking about the Fed Funds rate. (1:50) There are so many different interest rates, and each has its own length or term of borrowing. (2:17) When the Federal Reserve increases the Fed Funds rate that directly impacts the short end of interest rates. You can see it in 3-month and 1-year rates pretty easily. (2:50) The longer-term rates tend to do the opposite of what you would expect when Fed Funds rate is rising. They tend to go down. (3:25) When thinking about rates, they don’t necessarily impact long-term rates like a 30-year mortgage. There are many other factors that go into that. (4:11) Short-term rate changes impact variable rates like credit card debt. (4:35) What is the effect on stock market returns when rates are going up? Is it bad for stocks? (5:30) There is no discernible relationship when interest rates are going up or down on equity returns. It is not that easy to say any time rates are going up the market will be going down. (6:00) Cost of capital is a finance term that if a company wants to borrow money and interest rates are higher, then I will have to pay more money for that debt. That has a material impact on profits. (6:29) Cost of
Wed, September 21, 2022
Guide to Generational Wealth | AWM Insights #128
It is estimated that 70% of wealth is lost by the second generation and 90% by the third. This is what defines the phrase “shirtsleeves to shirtsleeves” and it has been this way for centuries and across cultures. What can be done about it? You have to start by being intentional and focusing on solving the problem for your family. Begin by thinking big picture and spending time and resources to set your family up for success over the long term. The number one issue we have seen is a lack of skillsets - not technical knowledge. Not knowing how to talk to your kids and failing to prepare them can be addressed early on. Setting the intent and fostering strong communication over decades can establish the foundation for them to then be successful into the next generation. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. On an iPhone? Click HERE to join. EPISODE HIGHLIGHTS: (0:27) There is no greater impact than working on your family and helping them become the center of that impact. Not just for today but into the future. (1:38) Why doesn’t wealth transfer? How you can have more impact on future generations? (1:44) Family wealth includes more than just dollars and cents. It includes values, history, and the stories that create family legacy. (2:05) Intentionality is difficult. The numbers are unfortunate. It’s estimated that 70% of wealth is lost by the 2nd generation and 90% by the third generation. (2:30) The “shirtsleeves to shirtsleeves” epidemic has been around for centuries. (3:02) To break this trend, you have to begin the process. Doing nothing or passing it off to someone else isn’t the best solution. (3:30) You shouldn’t be afraid of your kids inheriting large sums of money. You should feel confident they are prepared and educated on how to handle it when that times comes. (3:50) Passing off the wealth to someone else probably won’t result in the greatest impact for your family. Training your own family and heirs to steward the wealth well is an incredible opportunity that you have a lot of control over. (4:32) The data shows that 60% of the reason wealth doesn’t transfer is communication, and 25% is due to heirs being inadequately prepared. Technical knowledge only makes up a small amount of the problem. (5:45) Lack of skillsets. Not knowing how to talk to your kids and failing to prepare them can be addressed. Setting the intent and fostering strong communication over decades provides the foundation for them to be successful. (6:20) Not talking about money is common in our socie
Wed, September 14, 2022
Aligning Impact and Intent | AWM Insights #127
Money is just a tool to drive impact. What that impact looks like is different to every individual and family. The anxiety of preparing the next generation is universal across wealthy families. Building the mindset to raise kids well and not spoiling them while giving them the foundation to live productive lives is the cornerstone of generational success. How do you measure success when you’re giving? Are your money and time making the impact you strive for? Is the impact aligned with your intent? Should you start a foundation or use a Donor Advised Fund as your tool? In today’s episode, Brandon and Justin address these questions and discuss how to approach preparing the next generation to establish your family’s legacy. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. On an iPhone? Click HERE to join. EPISODE HIGHLIGHTS: (0:57) As a family office, where can we add the most value to our client’s lives? (1:17) Building the mindset to raise kids well and not spoiling them while giving them the foundation to live productive lives is the cornerstone of generational success. (2:09) How do you properly prepare for charitable intent? (2:37) If you want to make the most amount of impact, you should aim to do it best-in-class. Doing it with a strategy can increase the benefits of giving. (2:47) Does it make sense to have a foundation? Do you have a Donor Advised Fund yet? (3:12) One good way to measure impact is that for every dollar given, how much makes it to the cause at the end? (3:30) If you can’t accomplish everything you want with a Donor Advised Fund, then you should evaluate the foundation route. Foundations have a high burden of ongoing costs. (4:38) You don’t setup a foundation so you can put your entire family on the payroll and deplete what is left for charity. That is not impact and taking ownership of your wealth. (5:18) The key to focus on is intent. How do you make it part of your legacy? (5:55) If you are super innovative and really trying to do something new then a foundation or nonprofit may be the best tool. (6:03) If you are trying to give to the many already established well-run charities, it’s tough to beat the advantages of the Donor Advised Fund. (6:38) Many billionaires want to offload wealth from their children. Warren Buffett, Bill Gates are the ones that are doing this and they are taking the wrong approach. (7:07) You have the ability to train, form, and shape for twenty years to handle wealth. They can carry on your legacy into the future
Wed, September 07, 2022
What Protection Do I Need? | AWM Insights #126
It only takes one unfortunate event to bring down everything. That is why risk management is such an important part of protecting your financial structure and sustaining generational wealth. It is not generally given the attention it deserves. Risk management is more than just insurance. It is protecting against an uncertain future. This includes physical as well as online security. Families should be prepared for these risks and informed on how to deal with situations that hopefully never come up. It doesn’t make sense to skip insurance for the things that can devastate your plan when you can insure them relatively cheaply. Home, auto, personal umbrella liability, disability, and life insurance should be dialed in appropriately for each family. Life insurance is often sold as something more than just insurance. Sometimes it's touted as a bank or a wealth generation tool, but in general, simple is normally better. These policies are typically the most pushed because the commissions are the highest. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. On an iPhone? Click HERE to join. EPISODE HIGHLIGHTS: (1:17) You can build great wealth and create the best investment plan in the world but all it takes is one accident to ruin everything. Unless you have built out your risk management. (2:12) Insurance is just one piece of risk management. The future is uncertain and you should think about how to protect yourself. (2:40) Personal security and protecting yourself online are both forms of risk management. (3:30) How you construct your portfolio, when done right, is a form of risk management. (4:15) Uncertainty is what we should be concerned about as individuals. Risk is what a casino should be worried about. (4:33) Overly leveraging an investment portfolio is a risk that oftentimes blows up in the investor's face. Managing uncertainty should be done at the portfolio level too. (5:10) Partnering with a cybersecurity firm has given us insight into how to protect yourself online. (5:25) Using a password manager is much better than using the notes app or using an easy-to-guess password for all your accounts. (5:42) Public wifi is often a place you are a target. What are called “dirty networks” should be avoided and using your phone as a hotspot is usually safer. (6:06) Athletes are public figures and even if you don’t think of yourself as a target, people may look to target you because of the notoriety. (6:37) If you’re ever being followed, head to a public well-lit place. Being aware and ed
Thu, September 01, 2022
Building a Family Focused Investment Plan | AWM Insights #125
Where do you start when building an investment plan? What are the first steps and what’s most important? Should we maximize returns and let our investments run our lives or should we let our needs, wants, and wishes drive how we invest? Where do taxes fit in? You have only one net worth and one effective tax rate. Thinking about your investments separate from taxes is never optimal. You will end up paying higher taxes than is otherwise necessary. When you are wealthy and you ignore the tax implications of investments, you leave money on the table that could have been used for greater impact. It’s that simple and it’s still missed by many in the ultra-high net worth space. Aligning your financial resources to the things most important to you is vital before even thinking about what type of investments to make. Matching your investments with desired outcomes brings a better and more customized experience to the individual. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. On an iPhone? Click HERE to join. EPISODE HIGHLIGHTS: (0:57) Where do we start when building an investment plan? (1:17) How to optimize for your one net worth and your one effective tax rate. (1:35) Your financial structure is your net worth but it additionally incorporates the future. Human capital is valuing and accounting for future earnings. (2:30) Your financial asset stack is all your available resources which include cash, publicly traded stocks, public trades bonds, illiquid private investments, human capital, pensions, social security, and homes. (3:15) Aligning your asset stack to what you want to accomplish in life is the key to a successful investing experience. (4:11) Give money a job. Use your assets in the most effective way possible to achieve the priorities you want to accomplish. (4:25) If you want to pay for your newborn daughter’s wedding 30 years out, you don’t need those dollars now. This gives you the opportunity to invest in private equity and capture an illiquidity premium. (5:30) Having the full picture of your financial stack and matching it to your priorities allows you to be specific and deliberate in how you are invested. (6:46) Time and duration is important in investing but so is tax efficiency. Optimizing where and how you hold assets avoids leaving money on the table. (7:56) We want tax-efficient assets to be in taxable accounts. (8:09) Higher taxable income investments can be put in Roth accounts which takes full advantage of their tax-free qualities. (8:45) Be careful of someone sel
Thu, August 25, 2022
One Net Worth and One Tax Rate | AWM Insights #124
Tax planning is the backbone of the family office. A tax team focused on minimizing your taxes is a must-have for families to optimally grow wealth and then sustain it multi-generationally. These opportunities are often missed because most Americans invest money only in their company 401k or an IRA. But for anyone high net worth, taxes are the biggest cost to control. The highest tax brackets also present the numerous opportunities in tax planning. But to take advantage your tax advice needs to be integrated with the rest of your team. Ignoring the costs of taxes by using a separate CPA is not efficient and will end up resulting in paying more in taxes than is otherwise necessary. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. On an iPhone? Click HERE to join. EPISODE HIGHLIGHTS: (0:55) Integration of tax planning is the backbone of a multi-family office and is also the least appreciated. (1:05) Most investment advisers cannot legally give tax advice. This comes at a big cost to any of their clients that are high net worth. (2:05) Just being tax aware is incredibly powerful. You have one net worth and one tax rate which just means all roads lead back to the single tax return filed each year. (2:27) Keeping tax drag as low as possible in your investment accounts, leaves more money to compound and grow. (3:00) Sometimes these opportunities are small in any given year but over a lifetime of savings, the impact can be incredible. (3:17) It’s very easy to find little savings when you’re doing tax planning. (3:28) Tax loss harvesting is a prime example. This year has been one where taking advantage of this tax planning strategy will save clients money in the future. (3:59) Minimizing costs, which taxes are the biggest cost within a financial structure, results in maximizing returns. Other costs or frictions include trading costs, expense ratios, and fees. (5:15) Most people in America don’t need to worry about taxes. They save their money in their company 401k and IRA accounts where tax loss harvesting doesn’t do anything. (5:46) Great question to ask your advisor: when do you take a look at tax loss harvesting? Most advisors just do it at the end of the year which is a missed opportunity and you're missing out on tax savings. (6:30) CPAs aren’t in your portfolio looking at your situation daily. They won’t be able to take advantage of tax loss harvesting like an integrated team does. (7:26) CPAs that are not integrated with your investment team are going to miss advantageous tax planning strate
Fri, August 19, 2022
Do You Need a Family Office? | AWM Insights #123
Family office is the buzzword in the industry these days. The problem is not everyone is staying true to what a family office does and many are not keeping clients at the center of what’s important. Anyone with sports or business experience understands the value of the team. The integration, independence, and individualization of you advisory team provides you the opportunity to maximize your wealth. Each family is different and deserves a truly customized plan. Not the cookie-cutter solution most of the industry offers. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. On an iPhone? Click HERE to join. EPISODE HIGHLIGHTS: (0:40) If you worked hard and made a lot of money, do you even need an advisor? (1:00) Athletes and business owners understand the value of the team more than anyone. (1:23) Should I have a single family office, multi family office, or hire a broker? (2:04) Integrated, Independent, and Individualized are the 3 I’s that you should demand from your team of advisors. (2:25) Integrations means your investment plan and advisor is integrated with your tax plan and your tax advisor. The left hand must be talking to the right hand. (3:14) If you are not integrated then you are not optimized and missing out on maximizing opportunities to build wealth. (3:40) It is tough to argue against having taxes done in house. Anyone arguing against this doesn’t get it. Anyone saying you should keep everything separate everything to have checks and balances doesn’t get what a tax CPA actually really does. (4:03) An audit CPA will check to make sure your investments are legit and money is accounted for properly. Someone filing your taxes isn’t doing this. (4:40) A team of professionals within a multi-family office will have superior knowledge over a single family office because of the multitude of different situations that will arise and the problem solving to find solutions. This learning is limited in a single family office. (5:05) Independent multi-family offices are vanishing each day with private equity buying many firms over the last year. Rockefeller and wirehouses have hijacked the multi family office name and are not independent. (5:46) Independents have the ability to go find the best solution. This is in investments, taxes, estate planning. It is an open playing field with no restrictions on finding solutions. (6:42) Large institutions become restrictive due to compliance requirements and you can only select things from an approved platform. (7:20) These big firms are so afrai
Thu, August 11, 2022
Is Ultra-High Net Worth Advice Different? | AWM Insights #122
How do you establish a family legacy that transfers to the next generation? This is the most difficult task ultra-high net worth families will face. Of course, technical expertise is important when creating a legacy that will last generations, but the next generation must be prepared to steward wealth. Waiting until it’s too late is the worst thing you can do as a wealthy family. If transferring your family culture is important to you, the right team with the right experience can prepare your family for generational wealth transfer decades before it actually happens. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. On an iPhone? Click HERE to join. EPISODE HIGHLIGHTS: (0:54) Why do you have an advisor? From just starting out up to ultra-high net worth ($30MM+), what is different in the advice? (1:11) Mo money mo problems. With more wealth, the situation can become complex. (1:37) Tax planning is essential for everyone but for UHNW it can be a huge impact. (2:09) For UHNW, should you set up a foundation, or is a donor-advised fund better? (2:58) The estate tax and estate planning allow you to leave more to your second generation or leave more to charity. (3:25) If you’re wealth is illiquid, being thoughtful about how to manage that illiquidity is vital. (3:54) Real estate is an illiquid investment that can take days or months to turn into cash. (4:15) Determining how you set priorities and who is making decisions is an incredibly important part of the process. This is a complex and unique situation for each family. (4:46) There are two categories, technical expertise is the most obvious and involves the expertise and team of experienced and qualified individuals. (5:15) An example of technical expertise: our tax team found a $150,000 missed QBI deduction for a new client because of more eyes and more expertise for the client. (6:40) The second category is the transfer of wealth. The family governance concept is crucially important to avoid the “shirtsleeves to shirtsleeves” problem where generational wealth is squandered. (7:36) The next generation is an afterthought in almost all wealth management. (8:11) Waiting until it’s too late to educate the second generation is a huge error because, by the time they are in their 20s or 30s, they have already established much of their principles and values on money. (9:02) Our clients, whether on the field or in the boardroom are the best in the world at what they do. We want that same mindset to bleed into ev
Fri, August 05, 2022
What Can You Control In Investing? | AWM Insights #121
You should be investing, but that doesn't mean you have to settle for a poor investing experience. The broker selling you the next hot stock or Jim Cramer telling you to “buy, buy, buy” will not deliver the good experience nor the optimal returns you deserve. Too many investors hear about the newest hot stock on the golf course or in the locker room. They then go out and buy it. This is the worst way to invest because there is no foundational plan. Actively implementing a sound investing process involves minimizing taxes, reducing expenses, and eliminating frictional costs to your returns. It also keeps emotions in check and reduces anxiety or uncertainty. This is the process of building a bullet-proof financial structure. The foundation for multi-generational wealth starts with focusing on what is controllable and through this process the value system is created, which can then be repeated generation after generation. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. On an iPhone? Click HERE to join. EPISODE HIGHLIGHTS: (0:47) Over the past few weeks we’ve gone over the lessons of embracing market pricing, don’t outguess the market, and not chasing past performance. Embrace the power of markets working for us. (1:18) Don’t pick stocks. The data is proven you will underperform the index. (1:43) Jim Cramer yelling buy, buy, buy about stock or a Goldman broker pitching the next IPO is all nonsense. (2:15) What are the things you can actually control in the investing process? (2:48) Taxes are a huge impact and should be considered in investment decisions. (3:00) Expenses in the form of expense ratios you pay for mutual funds or ETFs. Keeping these low will help them not to eat into your returns. (3:55) Putting the focus and emphasis on what you have control over leads to higher confidence of achieving priorities. You don’t have to guess which way the market is going daily, weekly, or even monthly. (4:10) Financial structure is having a sound in place that provides the foundation for investing. It is what gives the discipline to shoot down the golf course chatter about a hot stock or mutual fund. (5:21) The right process will give you better expectations of success because of the discipline created in that very same process. (5:49) Only optimizing for costs won’t result in better returns. Optimizing for the value created should always be the standard. (6:40) Chasing lower costs is directly correlated with poorer outcomes. Qualified advisors add value far above their costs. (7:06) Trade
Fri, July 29, 2022
Emotions and Investing | AWM Insights #120
Recessions, high inflation, or all-time market highs are usually the only times investment news makes its way into mainstream media. Financial news is really incentivized to instill fear or greed and is only entertainment at the end of the day. Ignoring this noise is paramount to a better investing experience and zooming out to the big picture can help keep market adversity in proper perspective. Emotions, or the behavioral side of investing, costs the average investor over 3% a year when it comes to growing wealth. No one can completely ignore the pain of losing money or the animal spirits when the markets are doing well. Staying objective, sticking to your plan, and avoiding emotional mistakes are must-haves if you want to grow wealth efficiently. A good advisor prepares you before market adversity hits and then communicates in a way you can understand through markets like we have now. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. On an iPhone? Click HERE to join. EPISODE HIGHLIGHTS: (0:47) How should you deal with the market gimmicks of the media and the news cycle? (1:15) What are the human elements of investing and our portfolios? (1:35) The technical side of investing is what most people think is the most important part of investing. The emotional, pyschological, or behavioral side is arguagly more important. (2:10) Withstanding the behavioral challenges of investing over your lifetime will determine whether you have a good or bad investing experience. (2:39) The emotional side of investing must be taken into account, not just the financial science and math. (3:00) “Be fearful when others are greedy and greedy when others are fearful.” This famous quote by Warren Buffett is his advice on the emotions of investing. (3:26) It’s very easy to put money into investments when things are going really well. (3:50) Nobody likes losing money and panic costs many investors dearly. An advisor that is objective and nudges you to invest for your long-term goals even during stressful markets and coaches you to stick to your plan adds tremendous value and a better investing experience. (4:15) The financial media industry is built to encourage trading, overly focus on the short term, and certainly have no incentive to help you to achieve your individual priorities. (5:35) It is normal to have the psychological response to down markets. It is also the job of the advisor to look for risks in very good up markets. (6:09) Objective advice and answering questions with the data and th
Wed, July 20, 2022
The Only Free Lunch | AWM Insights #119
“Don’t put your eggs all in one basket” Everyone has heard this saying but are you doing it as efficiently as possible with your investments? Don’t fall in love with one single investment category because this overconcentration is an unnecessary risk. Intelligent diversification is implemented across countries (ex: US, Developed International, Emerging Markets), asset classes (ex: stocks, bonds, real estate, alternatives), and also factors (ex: relative value, small-cap, profitability). This diversification reduces the uncertainty of hitting the priorities that matter to you and avoids devastating outcomes that resulted from the lost decade in the US, the Japanese stock bubble, and the crash of US real estate during the Great Financial Crisis just to name a few. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. On an iPhone? Click HERE to join. EPISODE HIGHLIGHTS: (0:44) We commonly say the only free lunch in investing is diversification but why is it a free lunch? (1:05) Diversification is easy to misunderstand when it comes to investing in risky assets. Don’t put all your eggs in one basket seems logical but the details of how you diversify intelligently will have an enormous impact. (1:20) Jim Cramer is commonly featured on CNBC and tells people to buy one stock from each sector of the US economy (tech, industrials, etc). This isn’t smart enough diversification. (2:10) In public markets, there are thousands of companies within this opportunity set. (2:55) Identifying the winners within 1000s of companies has been proven to be a loser’s game when you look at the chances of outperforming over 1, 3, and 10+ year time frames. (3:47) Don’t fall in love with one single investment category. (4:00) Other countries have grown faster than the US even though the US has done well. (4:20) When building portfolios, we look at the opportunity set. We want roughly 60% of equity investments in US but the other 40% should be diversified into international developed and emerging markets. (4:35) Home country bias is evident across the globe and it is the reality that investors tend to overweight whatever country they live relative to the market capitalization of that market in the world economy. (5:43) The lost decade is a decade of poor returns for the S&P 500. Large cap US stocks performed terribly and didn’t make investors any money. (6:17) Emerging markets did amazing and returned over 400% during the lost decade for US large-cap stocks. (6:50) Country returns are difficult
Wed, July 13, 2022
Factors of Returns | AWM Insights #118
Investing in index funds or ETFs is a great place to start, but can you do better? There are segments of the stock market that have proven over time to deliver better results than the averages. This is backed by almost one hundred years of data and research across time periods and found in markets globally. Exposure to these parts of the market, known as factors, in a cost-effective way can provide higher expected returns rather than just settling for market returns. The caveat is that you have to be a long-term investor to capture these premiums and the patience required for most investors is maybe the hardest part. If it was easy every investor would be doing it. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. On an iPhone? Click HERE to join. EPISODE HIGHLIGHTS: (1:17) What are the actual drivers of returns in the public stock market? Why is there compensation for putting your money at risk? (2:25) If you want to get into the details and go deeper on investing, text 602-704-5574 for a longer conversation. (2:55)) An index approach is the epitome of letting the markets work for you. (3:13) A broad index market approach is a good place to start. However, there is evidence in the research of other factors that drive returns. (3:55) When you analyze the data there are groups of companies that perform differently than the whole. (4:08) The data shows there are parts of the market that underperform the general index and parts of the market that outperform the index. These are well researched and acknowledged factors in finance. (4:51) Company size is one factor measured by big companies versus small companies. (4:57) Valuation or relative value is another factor and is based on paying less money today for future earnings. If you pay a substantial premium for future earnings the evidence shows your returns could be better if you instead bought at a discount (lower relative price). (5:09) Profitability is another factor that is intuitive. Companies with higher profits tend to outperform companies that have lower or negative profits. (6:10) These groupings of similar stocks continue to show up in the data in a persistent way. Meaning they show up across time periods, across the world’s stock markets (not just the US), and across the different market cycles. For a factor to be valid, it has to be sensible and backed by the data. It can’t be an opinion and it has to be cost-effective to implement. (6:36) These factors also have to be cost-effective to capture. If the
Wed, July 06, 2022
Pursue the Better Investing Experience | AWM Insights #117
Results are what matter at the end of the day. We want to play the game that gets us the best results. The evidence presented in the last several podcasts has made it clear what you should focus on as an investor if you want the best results. Average returns in capital markets have produced phenomenal results. Allowing the market to work for you in the long term can generate shocking results. Do you have a strong financial structure? Are your short term priorities protected from bad markets, acute distress, or high inflation? Are you underinvesting for your long-term priorities? Do you hold too much cash? A clear and quality financial structure addresses every single of these concerns and increases financial wellness. This is how you build a better investing experience. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. On an iPhone? Click HERE to join. EPISODE HIGHLIGHTS: (0:27) Play the game that gets the best results. Picking stocks and attempting to time the market does not have the odds in your favor. (0:58) What do you get by allowing the market to work for you? (1:29) What’s the data show? A single dollar invested in the S&P 500 in 1926 and let it ride until 2021 (95 years) would have grown into $14,076. (1:49) This is a phenomenal rate of return so the question becomes why don’t we just accept that? (2:06) There are ways that can target higher expected returns than just the average but the key is to make sure they’re evidence-based. Most strategies don’t have any evidence to back them up. (2:25) Picking stocks and market timing don’t have any evidence to generate reliably better returns. (3:01) Everyone should work with an advisor. The reason most investors don’t receive good returns is because of behavioral issues. They panic and sell at market bottoms, fear losing money so hold too much cash, and get emotionally attached to their positions. (3:14) Professional athletes have coaches, executives have coaches, and it makes sense to have an advisor that serves as an investment coach. (4:03) A lot has happened over the last 95 years including wars, crises, and revolutionary inventions but if you stayed a long-term investor in the capital markets it was a really good thing for you. (4:25) Inflation fears are elevated right now but to put inflation in perspective, inflation turns the one dollar into $16. That is a tremendous loss of purchasing power if you don’t invest in the capital markets to outpace it. (5:12) Fearing inflation and pulling your mone
Wed, June 29, 2022
The Costs of Market Timing | AWM Insights #116
Can you trade on the market inefficiencies and come out ahead after costs and taxes? The evidence is clear and it isn’t good news for the market timers. These market timers are investors and advisors that promise to get out at the top and then get back in at the bottom. It sounds great in theory, but because the public markets are so efficient, the evidence is clear that it isn’t possible over the long run. Many investors have poor investment experiences because they try to accomplish the impossible rather than focusing on the things that they can control. Jumping in and out of the market is a fool’s game and that shouldn’t be thought of as a negative at all. It’s an opportunity to reframe and focus on what you can control when it comes to investing. This includes tax efficiency and minimizing costs, but also goes deeper into diversification and properly protecting your financial house from uncertainty. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. On an iPhone? Click HERE to join. EPISODE HIGHLIGHTS: (0:28) Athletes at the highest level know they are playing the game at a different level than the amateurs. This is the same in the investing world. (1:10) Not trying to outguess or time the market. Don’t outsmart yourself here. (1:29) Eugene Fama. famous for the efficient market hypothesis. famously quipped “I’d compare stock pickers to astrologers but I don’t want to bad mouth the astrologers.” (2:15) The outright number of competitors playing the “investing game” are intelligent and skilled adversaries with everyone on a level playing field of information. (3:21) Markets are not perfectly efficient, but it is the best model to explain what is happening that has been created so far. (3:30) Can you actually trade or invest on market anomalies and come out ahead? The answer in the data is no. Not when you factor in the costs and taxes. (4:30) A great question commonly asked is “where is the market going?” No one has a crystal ball to answer this question and if somehow they could accurately predict the market, they would be making money off of it and not divulging their secret power. (5:00) Going to the evidence proves over and over again that it is a fool’s game. (5:42) The cost of missing one week in the market at the wrong time can cost you as much as 15%. (6:48) If you jumped out of the market during the global credit crisis, which many did amidst the uncertainty, missing just 6 months was a massive cost in lost wealth. (7:31) The positive of all thi
Wed, June 22, 2022
Don’t Chase | AWM Insights #115
It seems natural that the most skilled and talented managers should be able to outperform on a consistent basis. In reality, the data doesn’t support this and it actually shows the opposite. In public markets, persistence, or the ability of the best to stay the best, just isn’t shown in the evidence . If the fund managers with all their large payrolls, research, and connections can’t reliably outperform then the advisors picking stocks in their client accounts are at an even bigger disadvantage. Index returns have been an amazing wealth creator over the last 100 years but indexes also have inefficiencies and pitfalls than can be avoided to target higher expected returns. Systematically targeting and improving the indexes allows for a more reliable way to seek returns above the index for long-term investors. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. EPISODE HIGHLIGHTS: (0:40) The data shows chasing past performance is not a good strategy. (1:30) It is natural to seek out the best and pursue some advantage through skill or talent. (2:00) What is missed by the industry is reporting on the best without doing the digging or investigating if the best actually have skill or happen to be lucky. (2:45) Efficient markets make it incredibly difficult to outperform. (3:08) If you find a manager that has outperformed, will they outperform in the future? Do they have some skill that will lead to future higher returns? (3:30) Chasing outperformance hurts your returns and the growth of your wealth. (3:50) Morgan Stanley, Merrill Lynch, Goldman Sachs, and the rest of the brokers built their value proposition on being able to allocate your money better than anyone else. (4:33) The data provided by SPIVA illustrate the terrible odds of betting on US Large Cap managers to outperform their benchmark. (5:24) The data shows only 15% can outperform the index so why not find that 15% who can outperform. The problem is there is no predictable way to find the outperformers ahead of time. (6:46) Are there other criteria that can be targeted besides just indexing and taking market returns? (7:10) There are funds and ETFs that are thoughtful about avoiding the inefficiencies of the index. Avoiding the pitfalls of indexes can be done in a systematic way. (7:56) There are different segments of the market that can offer higher expected returns compared to indexes over long periods of time. The evidence is strong in the persistence of these factors
Fri, June 17, 2022
How Does Market Pricing Work? | AWM Insights #114
When markets are down, it is natural to be concerned. Who determines these big moves in the market and what information can we learn from them? Every transaction in the public market needs a buyer and seller. The transaction they make is reported and publicly available to access. The market these buyers and sellers compete in is an extremely competitive and highly efficient marketplace. New information is incorporated into prices virtually instantaneously. Current prices reflect the collective knowledge and wisdom of an entire globe of educated and intelligent people competing relentlessly against each other. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. On an iPhone? Click HERE to join. EPISODE HIGHLIGHTS: (0:15) Markets are volatile right now and can be unnerving. How should you go about investing in times like this? Is there anything I should be doing? (1:18) How is market pricing determined and what assumptions can I take from these prices? (2:15) Public market prices are easy to look up and are quoted daily in the news. The S&P, Dow, and NASDAQ are the most commonly referenced. (2:50) The benefits of public markets with their liquidity and accessibility are also detrimental when markets become volatile. It is hard to ignore the headlines even for informed long-term investors. (3:29) Market pricing is determined by a buyer and a seller. Millions of stock market transactions are completed every day. (4:18) Markets are not perfectly efficient but markets are extremely competitive these sellers and buyers are setting prices. (4:48) In 2021, there was $775 billion dollars worth of trades. (5:24) War is going on and inflation has been impacting markets and reacting to new information virtually instantaneously. (6:00) Efficient markets don’t mean prices are correct, it actually means the current price is the best estimate of the collective wisdom of market participants. (7:20) An example is valuing Apple’s stock. There are 100s of analysts whose sole job is to accurately estimate the price of the stock. The numbers show even someone fully dedicated to figuring it out is usually wrong. (8:30) Market information in public markets is regulated and insider trading is illegal. People are put in jail pretty often for using this competitive advantage to gain an edge. (8:50) Investors as a group are very good at estimating using collective knowledge to pool all guesses together and the average ends up very close. Individually, the estimates are not clos
Thu, June 09, 2022
Investing in Private Real Estate | AWM Insights #113
In last week’s episode, Brandon and Justin started the discussion on real estate investing – hitting on topics like where and how to invest, public vs private, and types of properties. With the foundation now laid out, they dive deeper this week into how to actually go about investing and assessing whether you’re getting the returns you deserve. They continue their conversation by focusing on private real estate investment and covering how to think through real estate investment deals, finding specialized help, and understanding the trade-offs between investing on your own or investing in a fund. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. On an iPhone? Click HERE to join. EPISODE HIGHLIGHTS (1:45) Refresher on the types of real estate investments (3:48) Focusing on private real estate (5:00) What does the due diligence process look like to vet deals? (5:55) What stage is the property in? (6:48) What’s your edge? (7:43) Identifying value add properties – what improvements need to be done? (9:20) The opportunities and tax implications of development projects (11:06) Finding diversification through a fund (12:08) Promoter carried interest and hurdle rates (13:38) Understanding the costs of property and asset management (15:29) Finding specialized help (17:00) The importance of a good banking relationship
Wed, June 01, 2022
Risks & Returns of Real Estate Investing |AWM Insights #112
Real estate is a popular asset class and a huge wealth builder for many people. What are some ideal ways to approach investing in real estate? What can you expect for returns and what are the risks? If you are directly buying properties and expect mailbox money without any work, you are in for an unpleasant surprise. A common misconception in real estate is the idea of this passive income. However, owning properties is akin to running a business, and you will either have to do the work or you will receive below-market returns. If you don’t want to be a landlord (and have to deal with clogged toilets) but still invest in real estate, there are a multitude of vehicles that satisfy the objective. Real Estate Investment Trusts (REITs) are the simplest option and can deliver truly passive income. There are also private funds for real estate that require adequate due diligence but offer the possibility of higher returns than public market options. There can be tax benefits built into these funds as well. Returns in private real estate are nowhere close to venture capital, but the sources of returns are also different. Over the last 25 years, those returns have averaged 8.12% annually . In this week’s episode, Brandon and Justin discuss all things real estate investing and detail the avenues you can use to invest in real estate and what your expectations for returns should be. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. On an iPhone? Click HERE to join. EPISODE HIGHLIGHTS: (1:05) Is the only way to invest in real estate to go out and buy a property and manage it myself? (1:19) There are many options to invest directly and indirectly in real estate. There are many vehicles and different options for accessing this asset class with some requiring zero work. (1:32) Real estate investment trusts are the simplest and least complex way to invest in real estate. A REIT has a ticker symbol just like a stock and trades on a market exchange. (1:51) REITs generally have a niche or focus of their real estate strategy. It could be a specific area like industrial, office, commercial, residential, or multifamily. (2:24) There are also private market REITs. The only material difference being they are not publicly traded. This makes them less liquid. (2:42) Real estate funds are another option to invest in real estate. There are a lot of options in this area due to the size of the global real estate market.
Wed, May 25, 2022
The Rundown on Private Equity | AWM Insights #111
Investing in private equity (PE) boils down to buying ownership in non-publicly traded companies. Venture capital is just a small subset of private equity and sometimes the lines can be blurred between the two. Within Private Equity, there are multiple niche areas where the PE funds and managers put their focus. Private equity also deals with more mature or later-stage companies than venture capital. Expected returns in private equity are much different than venture capital, normally with less downside at the cost of the potentially bigger upside. Access to the best PE managers and funds still matters just as it does in VC. In this week’s episode, Brandon and Justin go deeper on what it looks like to invest in private equity deals, how it’s different than venture capital, and why deals should ultimately be vetted by an experienced investment team to avoid most or all of the returns going to managers rather than you. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. On an iPhone? Click HERE to join. EPISODE HIGHLIGHTS: (0:58) How is private equity different than venture capital? What are the expected returns in private equity? How do I have success in PE? (1:16) VC or venture capital is a subset of Private Equity or PE. Private equity is an entire ecosystem of non-publicly traded companies. (2:30) Private equity can be much more mature companies and sometimes have been around for decades. (3:01) Later stages of venture can bleed into private equity as startups turn into much larger and mature companies. Hedge funds have also been getting into PE. (3:33) Private equity is incredibly well-diversified across different types of companies. Venture capital is almost always focused on tech. (4:22) Private equity firms sometimes come in and buy a company that is public they view as not performing optimally. The PE managers come in and take the company private. An example of this right now is Twitter. (4:46) The stage of the company doesn’t always mean funding size. Mature companies aren’t always bigger. (5:25) Middle market private equity is sometimes family-run and geographically focused businesses. Helping owners hire a CEO and exit the company is what they try to solve. (6:00) Return profiles are vastly different for venture capital and private equity. Early-stage venture capital is the riskiest and therefore has the highest expected returns. It also has the largest range (dispersion) of returns. Something can 10x or go to 0. (6:40) Private equity returns are not like VC. Most of the companies at least retur
Wed, May 18, 2022
Finding the 10x Fund in Venture |AWM Insights #110
There are around 2,000 venture capital firms managing about 4,000 funds. It’s a small market in the grand scheme, but many aren’t worth investing in. The return difference between the top 25% and bottom 25% is staggering. This is a game of professionals. It’s no different than elite athletes competing at the highest level in professional sports. The same separation of talent exists in the venture capital arena. Investors with the best access look for 5x or more in returns. What else does it take besides capital to invest in venture? Are you an accredited investor or a qualified purchaser? Are you investing as an individual or an LLC? Are you making directs, allocating to funds, or even diversifying into a fund of funds strategy? Justin and Brandon give you the details on how the whole process works. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. On an iPhone? Click HERE to join. EPISODE HIGHLIGHTS: (1:02) How do I find the next all-stars and Hall-of-Famers in venture capital? (1:45) It is difficult to find the best-performing managers, funds, and even more so portfolio companies. And you are only rewarded if you can get into the best ones. (2:18) There is persistence in the data. This means the best managers in VC are able to repeat their performance. This is NOT like the public markets and their managers. (3:03) A different ecosystem in the venture space creates the opportunity to keep outperforming. Informational asymmetry and access to top-tier networks are the most significant drivers of persistent returns. (3:32) Is a VC manager going to keep outperforming his competitors? (3:55) Just getting access and an allocation to the small group of winners can be extremely difficult. (4:50) If someone is banging down your door to invest in their fund, that’s a red flag. The best funds returns speak for themselves and don’t need to search for capital. (6:40) When you finally decide to invest in a fund as a limited partner, what happens then? (7:00) You must be an accredited investor and many of the top funds require you to be a qualified purchaser . (7:16) Next, you need to read and sign a lot of documents including an operating agreement that establishes the role of the general partners. (8:08) A lead investor or a
Wed, May 11, 2022
Why Does a Founder Raise Capital? | AWM Insights #109
Why would a founder raise money? To turbocharge growth of the company. The company can grow faster from taking outside capital. In exchange, the founder is giving up partial ownership of the company. What should investors be looking for? The majority of companies in venture fail. It is wise to be skeptical and thorough. It isn’t enough to see a teaser pitch deck and start writing checks. Access to the data room and diligence in reviewing financials, management team, and legal documents leads to better outcomes. The best venture capital investors and founders look for a win win scenario. The VC investors get outsized returns and the founders get to build and grow their startup into a successful, sometimes dominant business. They also usually exit with millions or sometimes billions in liquidity. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. On an iPhone? Click HERE to join. EPISODE HIGHLIGHTS: (0:55) Why is a founder raising capital? What is the money for? (2:00) A venture company doesn’t have to raise outside capital but to grow and scale to become (2:22) Venture capital and tech are synonymous. (2:47) Deciding how much money to raise is a tough question for a founder. The more money a founder asks for the more ownership he or she will have to give up. (3:15) Owners and founders try to minimize their dilution of ownership. (3:50) Current market conditions are a big factor in to how much to raise and the valuation a company can raise money at. (4:41) A founder and client who just raised money before the market tightened is setting strategy on how fast to use the capital. Using the capital will create more growth but will also lead to the need for another fund raising round fairly quickly. (6:10) Example: A Web 3.0 company is trying to raise a $100 million at a $500 million valuation. For the math to work and to return a 10x, the company would need to be valued at $5 billion in the future. It is very difficult to create a company that grows to that kind of valuation. (8:05) You must be thorough. A teaser deck is often what you see being sent around to get you interested. An investment should never be made off this incomplete information usually produced by the marketing team of the company. (9:05) Investing directly in companies and their founder is very similar to investing in venture capital funds. The due diligence if requirements are very similar. (9:31) A data room is created, usually hosted in the cloud, and access is granted to investors to be able to download
Wed, May 11, 2022
How Does Venture Capital Investing Work? | AWM Insights #108
You’ve decided to jump in to private investing. You’ve already asked yourself if you should invest at all and discovered how to participate . Now that you’re ready to invest - how does it actually work? Who is giving money to whom and what are they trying to achieve? First, you start with a venture capital founder - an entrepreneur that starts a company with an industry-disrupting idea. Think Zoom, Peloton, and Coinbase as recent examples. The company must grow, scale operations, and eventually become profitable to become successful. Second, the Venture Capital Firm (VC) - a group of people who specialize in finding the next trillion-dollar company before they even have profits - funds the founder with the capital necessary to realize their potential. In exchange, they become equity owners of the business and work in partnership with the founders to increase the chances of success. Some of the most well-known VCs include Accel, Bessemer Venture Partners, Lightspeed, Sequoia, IVP, Benchmark, and a16z. Third, the investors, like AWM and other family offices, then put money to work with venture capital firms to target the outsized returns. The ideal end result is an exit (sale) that generates for the investors, VCs, and founders an outsized return. Without the idea and execution, the VCs and investors would not be able to capture this return. Without the capital invested, the company would fail. In this week’s episode, Brandon and Justin dive deeper into this process on how the venture capital investing works, the different seed and funding rounds, and what to expect throughout as an investor. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. On an iPhone? Click HERE to join. EPISODE HIGHLIGHTS: (1:15) Who are the players in venture capital? Who are the players in these deals? (2:03) Venture dates back to post-World War 2 with wealthy families investing in very early companies. (2:22) The venture capital managers specialize in finding the best new companies. The VC aggregates money from investors and searches for portfolio companies to make investments in. (2:33) RIAs and family offices, like AWM, deploy capital to these venture capital managers to find outsized returns. (3:05) The maturity of the company is divided up into seed, early, and growth stages. A company will usually raise money multiple times before it IPOs, is acquired, or fails. (3:36) The other key player is the entrepre
Thu, April 28, 2022
How to Participate in the Private Markets | AWM Insights #107
Last week, Brandon and Justin answered the question “ Should I Own Private Investments? ” In that episode, they gave a framework to consider before an investor jumps into the private markets. This week we continue our private markets series by answering the question of How to participate in the private markets. Private equity consists of all the companies that are not publicly traded. These companies are too new or too small to trade in the stock market. Private debt is just the bond equivalent in the private world. It is a very broad world of investing and carries different sources of risk but the potential for higher returns. Venture capital is one subsection of private equity and focuses on early-stage companies that are looking to change the world with new technology, ideas, or business models. Private equity can be mature companies that are bought to improve efficiency, operations, and financial structure. These companies can even be publicly traded, then bought out, and taken private. We’re seeing this in the news now as Twitter has apparently accepted Elon Musk’s bid to buy it. Private real estate is another massive area of private investing. These private real estate deals can be used to produce income, capital appreciation, or a mixture of both. The key is to know the tax implications and do the tax planning ahead of time. Private investments are an area a capable team can add significant value by providing the resources and the analysis necessary to do it well, but what are the areas you should be aware of before you jump in? Join Brandon and Justin in this week’s episode as they discuss. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. On an iPhone? Click HERE to join. EPISODE HIGHLIGHTS (1:20) Venture Capital is one subsection of private equity that has been rewarding for investors in the past. The highest historical returns have existed in early-stage venture capital. (2:30) Venture investing is simplified as becoming an owner in startup companies. These companies are disruptors and you’re backing new ideas or business models. (2:55) Different Stages of raising money: angel, pre-seed, bridge, series a, b, c, d. These rounds line up with the maturity of the company. (3:50) These companies need fresh capital because in the early stages they are not usually profitable. Once the business matures, they normally look to exit in a liquidity event. Possibly an IPO or an acquirer. (4:00) Private debt is another area of private investing. Rather than se
Wed, April 20, 2022
Should I Own Private Investments? | AWM Insights #106
Just because you qualify on paper for private investments doesn’t mean you should have them in your portfolio. Ignoring current spending and future income can lead to poor results that can and should be avoided. Just as Maslow created the “hierarchy of needs,” portfolio construction can follow a similar pyramid. Liquid assets reside at the bottom and illiquid (private investments) at the top. Investing for your priorities in alignment with a strong financial structure will increase the chance of achieving the outcomes you desire. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. On an iPhone? Click HERE to join. EPISODE HIGHLIGHTS: (1:21) What is private investing vs public markets? Should I be investing in private companies? (1:44) Many private investments are sold to people without a full understanding of the risks. (2:23) Why invest in the private side? Data shows higher expected returns! (3:27) The range of returns is very very wide. This variance of returns is the norm in private deals. (4:01) Public market managers do not have this same dispersion of returns. (4:50) “Every single company is a technology company whether they like it or not” is a common saying in private markets. (6:11) Why invest in private companies if the downside could be so bad? (6:35) With more risk, comes a higher expected return. (7:05) Buying ownership in companies that are just starting out. This is especially true in venture capital which has a high failure rate. (7:55) LIquidity is the ability to sell your investment with little time and cost to get the money. Publicly traded stocks are very liquid. (8:39) Everyone has the same information in public markets. If not, that is insider trading and people go to jail for that. This isn’t the case in Private Markets. Smart investors want an information advantage. (9:10) Information is king and access to the best information leads to the ability of the best to continue to outperform. There is no requirement to equally distribute public information. (10:20) Who can and should invest in private markets? (10:40) The SEC also regulates private securities and you must be an Accredited Investor or Qualified Purchaser to even be legally allowed to participate. (12:06) Illiquidity or locking your money up for 5-10 years is a trade-off of private investments. (13:10) Important priorities including your essential spending need to be sufficient before you can commit to these illiquid investments. (14:08
Tue, April 12, 2022
How Should You React to Market Adversity? | AWM Insights #105
Easy answer: Stay in your seat! If you are contemplating making a change, your financial plan is severely lacking. Now is not the time to adjust your plan. Any solid philosophy already has the game plan in place and is positioned for this adversity. Preparing for times like this is the most important part of your disciplined strategy to win the game. Stock and bond markets can and do go down together. This is normal and uncertainty in risk assets is a constant. It is the price we must pay for higher expected returns. If there was no chance to lose money, you would not be compensated for taking the risk. In this week’s episode, Brandon and Justin discuss the unsettling headlines in mainstream financial media, why they shouldn’t make you nervous, and how to set your financial plan to weather turbulent markets. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. EPISODE HIGHLIGHTS (0:59) Negative returns across stocks and bonds for the first quarter of 2022. (1:17) Unsettling headlines like “inflation hitting fastest clip since 1982” are scaring investors. (2:00) Should you bail on your investments or change your portfolio? (2:42) If you are reacting to this market adversity, then you weren’t doing it right, to begin with. A real financial plan addresses adversity before it happens. (3:44) Stay in your seat. (4:30) The uncertainty and volatility of the past three months are normal. If anyone is telling you differently, they are selling you something or are uninformed. (5:25) There is a reward for investing in risky assets. (6:55) 1-year returns are positive 75% of the time, 5-year returns are positive about 85% of the time, and 10-year returns are positive about 95% of the time. (7:40) Investors that stay the course are rewarded for their discipline. (8:08) If you could perfectly move in and out of the market, what money could you make? Or, if you missed every move, how much would you have? (9:11) Nobody has the crystal ball to be able to time the market. Tactical asset allocators claim to be able to do this. The data shows these managers cost their investors 2.7% per year over 10 years. Link (11:30) Unexpected inflation is what you need to worry about. Not expected inflation because that is priced into the market. (12:48) Treasury Inflation-Protected Securities hedge against unexpected inflation. (13:50) Over long periods of time, equities outpace inflation. It is the best way to protect purchasing power for the long term. (14:41) Having a pl
Tue, April 05, 2022
What Is An Index Fund? | AWM Insights #104
You have probably heard of the S&P 500, Dow Jones, or Nasdaq. These indexes are created to track the performance of a group of public companies. While you can’t invest in an index itself, you can invest in strategies that mirror the performance of an index. Warren Buffett, the greatest active investor of all time, is a fan of index funds. Warren understands how difficult it is to beat the market and has directed his estate to buy index funds when he is gone. There are also weaknesses with index funds – specifically with their strict mandate of tracking the index. In this week’s episode, Brandon and Justin discuss the strengths and weaknesses of index funds and the many small areas of improvement and efficiency that provide opportunities for long-term investors. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. On an iPhone? Click HERE to join. EPISODE HIGHLIGHTS: (1:10) What do we mean by indexing or “passive” investing? (1:55) An index is a rules-based classification that organizes companies (stocks) into a common basket and measures them daily. (2:35) The Nasdaq, the Dow Jones, and the S&P 500 are the most commonly quoted by the media. (3:02) The S&P 500 index is the 500 largest companies in the United States. (5:00) It isn’t possible to buy an index directly. It is only data and a representation of a basket of stocks. (5:57) You should select several indexes when building your portfolio to ensure global diversification. (6:20) You can buy an “index fund” in an ETF or mutual fund wrapper. Not all ETFs are passive index funds. (7:18) A significant advantage of index funds over active stock-picking is the lower expenses. These higher expenses and transaction costs decrease your returns. (7:55) Many active funds generate large tax bills that do not make sense for those with large amounts of assets in taxable accounts. (8:50) Warren Buffett has stated many times that his investments will go into passive index funds when he dies. He is the best active investor of all time, and he advocates buying index funds. (9:30) What are some of the downsides or negatives of only passive vehicles? (10:02) Indexes must be reconstituted periodically, allowing other investors to front-run this known event. (11:10) Tesla’s recent addition to the S&P 500 index is an example of an area of improvement. (12:10) Adding just 20 basis points of long-term compounding annually contributes substantially to the growth of wealth. (13:08) Can Indexes be improved if you systematically exclude un
Thu, March 24, 2022
Are You Better Off Buying an Index Fund? | AWM Insights #103
The most recent SPIVA Report for 2021 was just released and once again the same conclusion is reached. “Passive” has beat “Active” and only 15% of active managers that are paid to beat the market, did not. Passive investing, sometimes referred to as indexing, doesn’t engage active stock picking. Active management attempts to beat “the market” through the fund manager selecting the stocks. The great news for investors is that this competition between active managers creates efficient markets that are cheap and easy to buy through index funds. All you have to do is listen to the evidence. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. On an iPhone? Click HERE to join. EPISODE HIGHLIGHTS: (0:32) Brandon and Justin discuss stock picking and marketing timing. Is active or passive investing winning? (1:44) Active investors are trying to beat a benchmark. The most common benchmark is the S&P 500 Index. (2:06) An index is a defined collection of stocks. The Dow Jones Industrial Average has been around for over 100 years. (3:20) Active Management is commonly compared to these indexes to determine if the cost of research and implementation is worth the return. (3:50) You can’t actually buy an index itself but you can buy funds that very closely track its return. Plus, they have cheap fees. (5:20)Dispelling the myths of stock picking. (5:45) Active managers believe they can read the tea leaves and predict what’s going to happen. They also overweight or underweight sectors to “beat the market”. (6:25) The evidence every year shows it’s impossible to beat the market consistently . (7:09) SPIVA stands for S tandard & P oor I ndex V ersus A ctive report. (7:30) The report compares the many S&P benchmarks to the actively managed funds and identifies which ones outperformed and which underperformed. (8:50) 85% of active managers underperformed the S&P 500 over the last year. (10:35) Can you find the small percentage of managers that do outperform? (11:40) You can find better odds of winning than the 10 or 15% chance of picking the next outperforming active manager. You can get close to 50/50 in Vegas. (12:20) If for some reason you decided to try to identify which fund will outperform in the future, what are the characteristics to identify? (13:28) Taxes are frictional costs that drag on investor returns, and do
Tue, March 15, 2022
Is Your Advisor Competent? | Brandon Averill, Justin Dyer | AWM Insights #102
All advisors are willing to try to help. The problem is many do not have the right ability. Vetting an advisor for competence is a must for those wanting to create wealth. It also isn’t easy due to the incredible amount of designations or certifications that can be obtained with little effort involved. If you are serious about putting the right team around you, the minimum is to require a CFP®, CFA, CPA, and CPWA® on your team. This is the minimum an advisor can do to prove to you they are serious about having proper knowledge. An advisory firm that really cares about you and your money will require their advisors to have these before ever advising. It is lazy for any advisor in the industry to not obtain one of these, all they require is effort. After that, it’s time to evaluate what their experience level is with people like you. Hiring someone that doesn’t specialize in people in your situation is a recipe for failure. If you are a professional athlete, you will leave a lot of money on the table by working with someone that doesn’t focus on pro athletes. There are too many nuances and insider knowledge that comes from years of working with professional athletes that can only be learned through experience. Trust your instincts and if they sound more like a salesman or sounds too good to be true, don’t settle. There are competent, knowledgeable advisors that are in it for the right reasons and have your best interest at heart. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. On an iPhone? Click HERE to join. EPISODE HIGHLIGHTS: (0:52) How do you look for competence in an advisor? (1:30) How do you sort through 130 financial designations? (2:58) Cutting through the noise and requiring your advisors to have the best designations is a smart strategy. (4:14) CERTIFIED FINANCIAL PLANNER™ or CFP® should be the minimum that you require when it comes to general knowledge. (4:46) Certified Public Accountant or CPA specializes in taxes and is an integral part of tax planning. (4:54) Chartered Financial Analyst or CFA specializes in investments. This is the gold standard for investment management. (5:00) CPWA® or Certified Private Wealth Advisor® covers the most advanced strategies that are needed by the ultra wealth to manage taxes and implement proper estate planning. (6:30) You can’t rely on designations alone but if they aren’t at least putting the work to pursue these then you must question why t
Tue, March 08, 2022
Russian Invasion of Ukraine | Brandon Averill, Justin Dyer | AWM Insights #101
Russia has invaded Ukraine and war is the talk of the global news and financial media. Financial warfare has also been waged by countries around the globe with punishing sanctions placed on Russia. What does this crisis mean for your investment strategy? Brandon and Justin discuss what you should be thinking when it comes to unpredictable global events. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. On an iPhone? Click HERE to join. EPISODE HIGHLIGHTS: (0:45) How does the invasion of Ukraine impact your portfolio and investment strategy? (2:00) Long term thinking and refocusing on fundamentals applies to money but also everything else in life. Fitness, business, sports, all benefit by reframing and focusing on the basics. (3:10) No one is immune to the pain of markets adjusting to new information. It is normal human nature to stress out when the unexpected happens. (4:04) If markets only went up and to the right, then there would be no risk and therefore no reward. (4:48) Risk and reward are always related. You should expect corrections and drawdowns as part of the cost of seeking higher returns. (5:50) If everyone knew something was going to happen you wouldn’t call it a crisis. (6:25) No two historical events are the same. (7:40) You can’t time the market. You have to be right too many times. Getting out, waiting, then getting back in. No one in market history has proven they can reliably repeat market timing success. (9:00) Is it worth it to try to find the next Warren Buffett? No, there’s a better way than trying to get lucky. (9:30) Diversification is the only free lunch in investing. (10:15) Complacent thinking and not diversifying happens all the time when markets or assets are going up. (11:40) In times of stress, like right now, the benefits of diversification prove why you need it. US Government bonds have done their job once again in this downturn in protecting capital. (12:51) Diversification saves you, it allows you to stay invested and not panic. (13:40) If you have invested money in the equity markets that you need in the next year, you should be nervous. Moments like today is why financial structure matters. (14:45) Do I do this on my own or with an advisor? (15:03) If you want someone to help remove the emotion and has developed a skill set and builds financial structure to weather these kinds of storms, then an advisor will be worth their weight in gold to you.
Wed, March 02, 2022
How Do You Find a Good Advisor? | Brandon Averill, Justin Dyer | AWM Insights #100
You are ready to hire a professional but with over 300,000 people calling themselves financial advisors, where do you start? Multiple studies have proven that a good advisor can add 3% or more in value per year to their clients. Finding a good advisor with the right competence and without conflicts of interest is harder than it seems. Brandon and Justin give you exactly what to look for once you’ve decided to start looking and detail the value the real ones can add. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. On an iPhone? Click HERE to join. EPISODE HIGHLIGHTS: (1:05) If I don’t want to do it alone, how do I assemble a competent team? (2:32) There is no regulatory body that regulates who can call themselves a financial advisor like in the medical or attorney field. This is a detriment to the public. (3:40) Unfortunately salesmen in the industry can take advantage of clients very easily in this industry. (5:25) If you are looking at only investments and ignoring the big picture, you are leaving money on the table. (6:25) Doing things in isolation wastes a lot of time and creates unnecessary work for investors. (8:02)Elite athletes understand coaching elevates their game and it’s the same with finances. (9:10) Most people in the advisor industry are salesmen and don’t have financial expertise. (10:15) Conflicts of interest between advisor and clients is something to be wary of. (11:00) Competence is not rewarded in this industry. Many people start in the industry and “dial for dollars”. (12:30) Who owns the firm you are working with and what incentives are they driven by? (13:35) Law firms with strong professional standards are employee owned and that is not the case with most firms in the financial advisory world. (15:20) Designations and Certifications are the minimums for those committed to doing what's right for the client. (15:50) Simple questions like “are you held to the fiduciary standard?” and “are you investing your own money the same way you invest mine?” These are powerful questions to ask your advisor. (17:00) The benefits of working with a competent advisor is massive and have powerful studies that show as much as 3% of value added per year. (18:00) If the person you’re talking to is a broker then just move on. You want to find an investment adviser. (18:30) Brokercheck.com is how you can find out if they are a broker or investment adviser. (19:00) Next evaluate the person and firm for conflicts and advanced designations.</
Wed, February 23, 2022
How to Invest Without Hiring a Professional | Brandon Averill, Justin Dyer | AWM Insights #99
Are you a Do it Yourself Investor? Are you ready to handle it all yourself? Fear and greed drive many of the biases that hurt investor returns. Overconfidence bias and confirmation bias are two others that are proven to cost investors money. Big companies spend millions every year to influence and disrupt the focus of investors simply using human psychology. You don’t have to play Wall Street’s unfair game. There is another option to achieve your success. Taking compensated risks while controlling expenses and avoiding taxes makes for a better investing experience. Have questions for an upcoming episode? Want to get free resources, book giveaways, and AWM gear? Want to hear about when we release new episodes? Text “insights” or the lightbulb emoji (💡) to Brandon at (602) 704-5574 to join our new AWM Insights Network. On an iPhone? Click HERE to join. EPISODE HIGHLIGHTS: (1:16) What are the options to invest in the public markets? (2:45) Registered Investment Advisor Firms can give you holistic advice vs every other model. (4:15) Behavioral finance is the broad psychology of attitudes and biases interacting with decisions around money. (4:50) We are prone to biases that can make investing even for trained professionals difficult. (6:15) The most powerful of all biases being fear and it’s cousin, greed. (6:23) “Fear has a greater grasp on human action than does the impressive weight of historical evidence” - Jeremy Segal. (7:00) You can get an incredible investment experience with robust results without playing the Wall Street game. (7:40) Avoiding the hot stock talk or investor bubble turns out to lead to better outcomes. (8:30) Focus is constantly being influenced by large companies spending thousands of dollars to bring you into their game. (9:08) The data for investors underperforming is constant, 1984-1995 the S&P 500 was up 15% a year while the average investor only earned 6.3% a year. Why? (9:37) Investors don’t want to stand by and do nothing. They want to take action and the overconfidence bias is well-established. (10:31) The overconfidence bias shows up in character studies and when it comes to over-trading their brokerage accounts. (12:10) Confirmation bias is looking to verify the things we already believe. We ignore what contradicts that. (15:40) SPIVA active vs passive data is released twice a year. Every year active management is proven to underperform over the long term. (17:30) Do the outperformers in one year continue to outperform. No, there is no persistence. (18:30) There is a different game to play. Avoiding taxes, high expenses, and optimization of net worth can provide persistent results. (20:15) Your di
Wed, February 16, 2022
What Does It Cost to Buy a Stock? | Brandon Averill, Justin Dyer | AWM Insights #98
Do you know how to buy a stock? How do you open a brokerage account and which account type should you select? Have you made an investment in private equity before? In this week’s episode, Brandon Averill and Justin Dyer answer these questions in detail along with the expensive costs you may not know about, and what to watch out for to become a savvy investor. EPISODE HIGHLIGHTS: (2:14) How do you buy an investment in public markets? (3:12) To invest, you go and open a brokerage account. Just like opening a checking or savings account. (4:35) A brokerage account is the most convenient way to buy publicly traded securities. (5:35) There are many different kinds of accounts and are mostly determined by the tax code. (7:03) Independent custodians hold the assets of independent RIAs and the separation is important. (8:00) Robinhood or other discount brokers allow you to trade on your own. (8:52) How do you actually make an investment? (9:30) How you go into your account and place a trade to buy. (10:38) Every stock, bond, ETF, and mutual fund you must know the symbol to be able to buy it. (11:35) How to buy a stock or ETF. (12:10) Bonds also have fluctuating market prices you will have to pay. (13:50) Trading costs in the form of a direct fee or the spread are transaction costs. (14:50) The bid ask spread is an overlooked cost to investors. (16:47) The accessibility of public markets is a huge advantage to investors today. (17:40) How do you make a private investment? (19:10) Be wary of who is presenting the deal to you and why it made it’s way to you. (19:40) Private markets consists of private equity, venture capital, hedge funds, and private real estate. (20:57) Transparency and lack of legal structure can lead to fraud if not careful. (22:40) Investing into a pool of money with other investors makes you a limited partner. (23:15) Limited partners give over decision making to the general partners. (24:00) When money is committed the general partner will make a capital call to the limited partners.. (24:30) Legal costs of creating these investment vehicles and the tax pain point. (25:30) Compared to an ETF, private investments and their structure are much more complicated. (26:45) Private investments have minimum net worth requirements or income requirements to qualify. (27:20) Access to the best private investments is extremely competitive. (28:12) Hidden costs of being lower down the cap table aren’t always acknowledged. (29:00) What are the advantages and disadvantages of being with different types of advisory firms. Which ones provide better access?
Tue, February 08, 2022
NFTs Explained | Brandon Averill, Erik Averill, Justin Dyer | AWM Insights #97
What is a Non-Fungible Token and should you be buying or creating them? NFTs and Web 3.0 have the vision to return ownership and value back to creators and their communities, but can that vision turn into a reality? After seeing news headlines like one of Beeple’s NFTs selling for $69 million, there are a lot of questions floating around this relatively new technology. In this week’s episode, Brandon Averill and Justin Dyer are joined by Erik Averill to discuss how NFTs work, why they are not a get rich quick scheme, finding the true value in the technology, and where they might fit in an investment portfolio. EPISODE HIGHLIGHTS: (1:01) What is an NFT? Should I create an NFT? Should I buy an NFT? (2:26) Always understand what you’re investing in. This goes for NFTs, too. (3:00) An NFT is a non-fungible token. A dollar bill is a fungible. They are all the same. Non-fungible would be if President Biden signed it specifically made out to you. This makes it one of a kind and unique to you. (4:28) NFTs offer the promise of being the only one of its kind in existence. (5:52) Beeple’s NFT sold for 69 million dollars. But it’s more than just a digital image. (7:10) You are buying more than a digital image when you buy an NFT. (8:05) This is not a cash grab or get rich quick scheme. If you approach NFTs that way you will not have a good investing experience. (9:11) Web 3.0 is the redistribution of ownership back to the community. Creators and the community want to cut out the middleman. (10:10) Beeple’s digital art is directly comparable to the physical art world. Just like the Mona Lisa is valued highly by the art community. (11:15) Signaling within the Web 3.0 community is driving a lot of these headline grabbing prices for NFTs. (12:05) NFTs like other collectibles (art, wine) will not end with good results for most investors. (12:55) Buying an NFT is buying into a community of people. This community can be where the real value is to NFTs. (15:00) There is extreme hype right now in NFTs and crypto. Top Shot is one example of that. (17:05) There is a ton of innovation that will change the landscape and disrupt many current competitors in the NFT space. (19:00) Be aware of copyright protection. As a creator, you want to ensure the value you have created comes back to you. (21:15) The technology is incredibly young but the innovation within technology is tangible to so many. (22:22) Applying the principles of other investments to NFTs is crucial. Investing in NFTs must be done in the same way as other assets. (23:38) Gary V, one of the biggest crypto supporters, believes 98% of them will go to zero. (25:00) It’s an exciting space but any money put into NFTs should be coming out of your speculative/entertainment bucket. (27:13) Picks and
Tue, February 01, 2022
Vehicles of Investing: What Am I Buying? | Brandon Averill, Justin Dyer | AWM Insights #96
So now you are ready to invest and become an owner or lender, but what do you buy and how? Stocks, bonds, mutual funds, ETFs, hedge funds, and private investments all make up the universe you have an opportunity to invest in. To keep it simple, buying stock is ownership and buying bonds is lending. Both mutual funds and ETFs can be very efficient vehicles to access public markets but understanding the details is an essential step. Private investments like hedge funds, venture capital, and private equity can be a source of great returns but are also less transparent with much less information than the public markets. EPISODE HIGHLIGHTS: (2:01) Stocks are ownership and bonds are lending. (2:30) Stocks are direct ownership. Think Apple, Microsoft, Tesla. (3:34) Bonds are just loans. These loans can be to the US government, local government, or companies. (3:55) Publicly traded companies (Apple, Microsoft) also issue bonds to then use that money to create more value or feed growth. (4:40) There is a hidden cost: the spread between the bid and the ask price. (5:25) Access to public markets is incredible and as simple as it has ever been for investors. (6:05) Mutual funds, why they exist and what they offer. (7:27) Single stock risk and why the diversified portfolio outperforms. (8:30) Before diversified pooled investment vehicles, investors were overly concentrated in just a few stocks to the disaster of many during the Great Depression. (9:01) Diversification and the closest thing to a free lunch in investing. (9:08) Private markets have illiquidity issues and slower transaction time to complete a purchase or sale. (9:46) Mutual funds are only priced once a day. At the end of the day they are traded or redeemed at their Net Asset Value or NAV. (10:30) Exchange Traded Funds or ETFs are traded similar to a stock throughout the day. (11:45) ETFs have gained in popularity but have been around for more than 30 years. (12:30) The misconception of mutual funds due to some fund companies charging high fees in the past. Not all mutual funds are the same. They are just a vehicle. (13:20) There are expensive ETFs and inexpensive ETFs just like the mutual fund universe. (14:50) Derivatives. How ETFs use these to juice returns and the drawbacks. (16:10) The movie to watch on derivatives is The Big Short. (17:00) Hedge funds were originally started to hedge market downturns. (18:05) Hedge funds have evolved into a bet on an active manager that they can beat the market. There are many strategies that now fall under hedge funds but very few do any hedging anymore. (20:24) Private companies also sell ownership in stock or take money in the form of loans as bonds. (21:33) Buying stock of private companies or lending them money is called dir
Tue, January 25, 2022
Are You An Owner or Lender? | Brandon Averill, Justin Dyer | AWM Insights #95
To understand investing, you must start with ownership and lending. You can use your money to either buy ownership or lend it to borrowers. Investors are either owners or lenders, anything else is a speculator. Ownership Participation in profits, growth, cash flow. You own the future of the business for good or bad. A stock, mutual fund, or ETF is your claim to the assets minus liabilities, but most importantly the stream of future profits. Lending Loaning out money in exchange for fixed payments and eventually a return of your initial investment. Individual bonds, bond funds, or bond ETFs do not entitle you to the growth of a company. But in exchange, if the company goes out of business, you have a higher claim on the company’s assets than stockholders (ownership). EPISODE HIGHLIGHTS: (1:05) The very first principle of investing. (1:53) Ownership versus lending. (2:25) Ownership is a claim to the company’s profits. And that means risk if the business does poorly. (3:30) Your equity in the business is assets minus liabilities and the future profits or cash flows from the business. (4:05) Companies may not be profitable now but have the potential for large future profits which will make the company valuable. (4:42) Real estate equity is the same math as equity in a company. (5:55) Rental real estate and the future income it provides is a great example. (6:15) Discounted Cash Flow explained. This is how you value an asset. (7:20) Valuation is the basic principle of financial markets. It’s the same process no matter what asset you choose to value. (8:08) When it comes to being an owner or lender, you can do it in the public market or private market. The biggest differences between the two is efficiency of information and volume of transactions. (9:08) Private markets have illiquidity issues and slower transaction time to complete a purchase or sale. (9:45) If you own the shares in a public company and they release reports about their expected future cash flows increasing. The value of your ownership has gone up. (11:49) Lending is called fixed income and/or bonds in the industry. (12:40) You lend your money in exchange for interest and your initial investment is returned at the time period. (13:00) Lenders have a higher claim than owners in the event of bankruptcy so it is less risky to be an owner. But you also are not entitled to profits if the company does extremely well. (13:57) Public Debt vs Private Debt (14:30) A good example is mortgage lenders and the specialization of lenders. (16:50) A good example of lending is Microsoft selling bonds to investors. Because Microsoft is so large and with a strong balance sheet. They are able to get a very low interest rate which the market sets. </
Wed, January 19, 2022
Why We Invest in the First Place | Brandon Averill, Justin Dyer | AWM Insights #94
Why risk your hard-earned money? What if you don’t invest because you’re too scared to take any risk? Every person has different priorities and investing money to meet those priorities is crucial to not just our happiness but the legacy we leave behind. Just making money for the sake of making money won’t lead to a satisfying investment experience. Successful investors put themselves in position to weather downturns so they can capture long-term returns. This allows you to be conservative where you need certainty and aggressive where you need growth. You can tilt the odds in your favor to achieve desired long-term results by adjusting your strategy, optimization, and continuous planning. EPISODE HIGHLIGHTS: (0:30) Why even take your hard-earned money and put it at risk by investing? (1:25) Investors that don’t understand the why behind their investing strategy will not have a good investing experience. (2:30) Invest to maximize the odds of achieving your unique priorities. (2:53) The reason you invest is to take the capital you have today, optimize it, and invest with the odds in your favor to meet the priorities most important to you. (3:33) No one will ever be laying on their deathbed remembering how they beat the S&P 500 every year. They will remember the impact their money made on the lives of those they care about. (4:40) Everyone has priorities and money should be grown to meet those priorities. (5:34) We need money to grow. If not, purchasing power is lost every year. (6:50) Warren Buffett’s is no doubt a great investor but the key to creating his billions was actually time. (7:39) Chasing past performance or active management with a good story doesn’t end well for investors. It usually means future poor performance. (8:30) Short-term sound bites make for great media but are rarely right. These market predictors are almost never held accountable if they’re wrong. (9:50) Psychology of Money by Morgan Housel tells a great story about how being lucky but lacking investment strategy can literally ruin lives. (11:28) Headlines make for great entertainment, but shouldn’t drive your strategy. Pushing the odds in your favor for success will keep winning over the long-term. (12:00) Be conservative where you need certainty so you can be aggressive where you need growth. This is how you give yourself the greatest chance of success. (12:30) No one can predict the future but you can put yourself in position to achieve success over the long term. (13:50) Private markets have gained a ton of press but they should always be integrated as just one part of your long term strategy. (14:55) A protective reserve provides the financi
Tue, January 11, 2022
The Big Picture | Brandon Averill, Justin Dyer | AWM Insights #93
Money is such an important part of our lives, impacting mental and physical health. With so much information available immediately and through so many sources, sticking to the data of what works for a good investing experience can be difficult. Zoom out and look at your big picture first. This will always help focus on what’s actually important and to ignore or block the things that don’t actually matter with a wider perspective. EPISODE HIGHLIGHTS: (1:45) Why is money even important? Why do people jump to invest before looking at the big picture? (3:20) With so much information out there, why is it so hard to filter out the bad? (4:05) The data and evidence for a good investing experience is out there. (5:23) Why do we invest? This is the first step to understand your big picture. (5:55) Everyone’s personal experience with money is different and defines how they behave in the future with their investments. (7:05) To help our clients, we reframe and guide to the long-term, to multigenerational growth of wealth. (7:45) NFT boom and Opensea. Is this a “sure thing” to invest in? (8:45) Nothing is certain in investing. No one can predict the future. If there is no risk there would be no return for the investor taking that risk. (9:30) Theranos and Elizabeth Holmes were seen as a great investment at the time. It ended with investors losing everything and Holmes convicted of fraud. (10:30) OpenSea’s valuation is very high. If you were to invest, keeping the allocation small and part of a bigger private investment portfolio is how you would do it. (12:00) Statements like “crypto is going to change the world” should trigger you caution reflex. (12:45) Be careful getting caught up in the flashy returns. Return back to what will give you the best chance of achieving long term wealth. (13:30) Not investing in private markets isn’t the right answer either. Proper allocation to private markets is where you can seek big returns, when done the right way. (14:17) At the end of the day, what are you trying to achieve. Determine your priorities and the investment decisions become simple. (15:20) Investing is to make money but many investments will do that. Next week will cover how to do it most effectively.
Tue, December 21, 2021
What Does Financial Structure Mean? | Brandon Averill, Justin Dyer | AWM Insights #92
Financial Structure is a household’s entire net worth, human capital, and tax rate evaluated in a comprehensive and holistic framework. No matter how many different accounts you have, you only have one effective tax rate . A portfolio is only one part of your Net Worth . Other assets should not be ignored. Human Capital , often the greatest asset on a personal balance sheet, should also be counted. Priorities are everything you want to achieve in life and the financial structure should be tailored to achieve those outcomes. EPISODE HIGHLIGHTS: (0:40) Markets are struggling and have finished down for three out of the last four weeks. (1:03) The Federal Reserve has pivoted to be more “hawkish” and is speeding up the end of QE and signaling faster interest rate hikes. (2:40) The Omicron variant is having less of an impact on the market as it is proving to be less deadly than previous variants. (3:25) HSBC and Wells Fargo are settling currency trades between each other on the blockchain. A great tangible benefit and use case for the blockchain. (4:05) Reddit has filed for an IPO and will go public early next year. (4:15) The Build Back Better bill currently in Congress is not going to pass before the end of the year. Joe Manchin has shut it down and will be pushed to January. (5:20) Fed Chair Jerome Powell has publicly said he can’t predict interest rates. (7:10) Financial Structure is the big picture of one net worth, one effective tax rate, and knowing the value of your human capital. (8:25) Planning is an ever present item. Waiting until the last minute means you most likely have already lost out on the opportunities. (9:00) Roth Conversions and Backdoor Roth strategies. (9:30) Mutual funds are required to pay out their capital gains in the fund. These distributions can sometimes be massive short term capital gains. (10:35) Turnover in funds, meaning they are churning their holdings through frequent buying and selling can mean a huge tax bill. (12:15) Because of the reporting, no one really sees the tax drag this causes for investors. (13:15) Tax loss harvesting is a strategy to bank losses to offset future gains while staying fully invested. (13:50) A dynamic trading system allows the opportunities to be exploited throughout the year and doesn’t wait until an arbitrary date. (14:40) Integration with tax planning, investments, financial strategy, insurance, and estate planning keeps. (15:40) Many times tax preparers don’t understand tax loss harvesting and many other financial planning strategies. (16:15) Donor Advised Funds and giving appreciated assets maximize impact for both you and the cause you care about. (17:10) Instead of selling and donating cash, gift the shares directly to the
Tue, December 14, 2021
Gambling vs Science | Brandon Averill, Justin Dyer | AWM Insights #91
Fundamentals are the science of investing. The data and evidence prove that long-term investors that stay tax-conscious win over the long term. Smart diversification, managing emotions, avoiding media pumping fear and greed, and letting markets work for you is the proven way to invest for wealth. Gambling and speculation will always be more “fun” for the risk-takers. It is also a good way to have poor returns, high taxes, and at worst, destroy your wealth. For every home run to be flaunted in the media there are hundreds of strike-outs. Risk and reward are always related. There is no free lunch. There are no shortcuts to build wealth. EPISODE HIGHLIGHTS: (0:28) News: US Inflation at highest level since 1982. Unemployment dropped to lowest level since 1969. (1:56) Starbucks employees at a location in Buffalo voted to unionize. (3:19) SEC Chair, Gary Gensler took aim at SPACs and the risks they pose to investors. (4:20) The indexes are near all-time highs which is hiding the carnage of many speculative stocks. Many are down more than 50% from their highs. (5:31) Are you a long-term investor or are you gambling to hit a home run. (6:03) There are over 6,000 different cryptocurrencies. Picking the few winners is too risky to bet your financial future on. (7:17) The fundamentals of an investment are the science and logic behind it. This drives a future value that should be your gain. (7:55) Crypto makes huge claims that are a stretch to ever be realized. (9:15) Crypto is only one use of the blockchain and it's possible to not even be the best use of the technology. (10:20) You can apply the same logic picking crypto to stock picking. (11:00) Over Allocating to too few companies or too few cryptos can unnecessarily risk your wealth. (12:00) If you have your core priorities taken care of, then you can take speculative risk. You can take chances on low percentage opportunities with massive upsides. Because if you lose it all, your financial security is not in jeopardy. (12:47) Markets have been said by some to be overvalued for the last decade. If you had acted on that information waiting your returns would be terrible. (13:20) Valuation data doesn’t correlate with forward returns. If they did, it would be easy to outperform the market. (14:20) Media never goes back to see if they were right with their predictions from the year before. Keep a look out for all these fortune tellers heading into the New Year. (15:30) Market valuations are high but that knowledge doesn’t help you with forward returns. (16:38) Speculating is fun when it comes to fantasy football, sports gambling, and casinos. Building generational wealth with science and data removes the uncertainty of hoping to get lucky. (17:45) The media loves to rile up investors predicting gloom and doom. They al
Tue, December 07, 2021
Why Winners Keep Winning in Private Markets | Brandon Averill, Justin Dyer | AWM Insights #90
To get the best returns in Private Markets you need to have an advantage. Do you have more information or uncommon expertise about the company? Can you add value to the company to improve their chances of success? Do you have the time and team to evaluate 1000s or deals a year. The best firms keep winning for the same reason Alabama dominates College Football. The best talent, coaches & players, want to go there. This success breeds more success. It is the same in venture capital. EPISODE HIGHLIGHTS: (0:28) News: Omicron and faster Fed tapering is causing volatility in the market. (1:26) Inflation has moved from being transitory to more persistent according to the Federal Reserve. . (2:56) MLB Players have been locked out by MLB Team Owners. Until an agreement is reached, the MLB 2022 season is in jeopardy.. (3:03) Money has been pouring in to Private Investments amid strong performance. (5:31) Private markets, unlike public markets, have information asymmetry which can cost novice investors a lot of money. (7:37) To get the best returns in Private Markets you need an advantage. You need to have better information or the ability to add value along with Capital. (9:51) About 60% of venture capital companies go belly up. (11:11) The winners keep winning when it comes to Venture Capital. (11:30) The best venture capital firms are like the elite College Football Teams. The best talent wants to go there and they get the best deals. It’s a self reinforcing cycle. (12:41) The best venture firms are seeing 1,000 pitches a year. They only pick a few. (13:37) Expected returns in the future - resetting your expectations (15:29) Private markets are not the most tax efficient asset class (17:25) Invest in the best in the private markets or just take your money and go right back to the public
Tue, November 30, 2021
Superpowers of Investing | Brandon Averill, Justin Dyer | AWM Insights #89
To be able to invest like a pro for the long-term you must adopt three investment philosophies: Let Data Drive Investment Decisions This means ignoring chasing the hot stock or crypto of the month and following the data that produces the best returns. Anyone that has chased COVID stocks this year like Robinhood, Peloton, or Teladoc has lost a ton of money. The same is true for those chasing the recent fund performance of Cathie Wood and ARK ETFs (tickers: ARKK, ARKF, ARKG) which have massively underperformed the market index. This same story plays out year after year in the markets and the costs to investors is painful to watch for experienced advisors. A new generation of investors gets sold the same false promise of shortcuts to wealth every market cycle. Stay Long-Term Focused Time is the greatest superpower in investing. Being patient and ignoring the short-term is always easier said than done. It allows an investor to ignore their FOMO in the greed cycle of markets and suppress their panic when the fear cycle follows. Planning early and understanding how time can greatly benefit your wealth is not easy to understand for anyone yet it is and will always be the biggest driver to wealth creation. Customized Diversification Matters Excessive concentration creates unnecessary risk for generational wealth. Investing according to priorities reduces uncertainty while creating a tailored and superior investment experience. Risk tolerance questionnaires or age based investing philosophies completely ignore what’s important to you. This type of investment advice isn’t proper planning and does not set you up to create generational wealth. EPISODE HIGHLIGHTS: (0:47) News: The Omicron variant of COVID has created uncertainty which rocked global stock markets on Friday. This is a big dose of uncertainty and markets react quickly to these type of events. (1:39) IPO stocks so far this year are below their initial listing price. This is to be expected as the data on buying IPOs is not good for investor’s returns. (3:10) Jack Dorsey has stepped down as CEO of Twitter. (3:45) Being data driven is an investing superpower. This is a principle of investing that should be a part of your philosophy. (4:14) Long-term focus is another superpower. It is natural to overly focus on the short-term. Reframing your mindset to care only about the long-term can be learned and will produce better outcomes. (5:06) You can’t solve heart disease with a weight loss pill at age 65. You achieve better results by starting at a younger age with establishing discipline. (6:57) Why is it so hard to appreciate the long-term. (7:57) A portion of your portfolio should be invested in very risky assets to grow. (8:20) Dave Ramsey telling people to invest eve
Tue, November 23, 2021
What Type of Gifts Do You Buy? | AWM Insights #88
The gifts you buy for other people define a lot about your relationship with money. Are you compensating for an insecurity? Are you showing off? Success with your money starts with your relationship with your money. What are you trying to achieve with your assets or income? Is your portfolio customized to your specific priorities and vision of success? Understanding the cash flow game creates the extraordinary opportunity to generate enough passive income to enjoy the lifestyle you desire for life. Understanding your own relationship with money is key to winning this cash flow game. EPISODE HIGHLIGHTS: (0:57) News: unemployment continues improving, Rivian has now gone public with a market value greater than Ford Motor. Staples Center becomes Crypto.com Arena. The Build Back Better Plan has passed in the house and moves to the Senate. (2:23) This holiday season is predicted to be the highest retail sales on record. (2:55) Relationship with money and the why behind what kind of gifts you give to other people. (3:58) A great book that explores the complex attitudes and emotions that people have with money is The Psychology of Money by Morgan Housel . (4:58) Success with money has very little to do with how smart you are. Many intelligent people struggle with money and saving. (5:55) “The gift is for the giver” is an old saying because there is usually an interesting why when it comes to what people give each other. (7:00) Winning the cash flow game is essential to financial success. (7:44) Simplifying the ways to generate income: human capital, intellectual capital, social capital. (8:20) After taxes you can spend it, give it or save it. It’s that simple. (8:45) “The cash flow game is making sure you can get enough into the savings and growing category so that the earnings from that, the passive income from that, can pay for the lifestyle you’ve created” -Brandon Averill. (10:10) Winning the planning aspect early sets you up for the future. (11:25) The breakdown we see is a portfolio not invested to achieve the priorities of the client. Each portfolio should be invested according to the priorities and values of the client. (14:28) Visit our website to request a free copy of Morgan Housel’s book Psychology of Money .
Tue, November 16, 2021
Ignoring Tax Planning is Expensive | Brandon Averill & Justin Dyer | AWM Insights #87
Congress is set to pass a large spending bill before the end of the year that will increase the tax bills of many. Tax planning is something every athlete deserves incorporated into their financial advice, yet few are actually getting. An advisor that is making recommendations without looking at the tax impact is costing you money every single year. This is unnecessary wasted wealth that you can never get back. Tax planning is easily the most missed opportunity and it’s up to clients to demand it. Tax loss harvesting, backdoor Roth conversions, avoiding unnecessary capital gains, accelerating, or deferring income, asset location, individual 401ks, and duty days are just some of the menus of options when it comes to managing your tax bill. If you ignore tax planning, you are choosing to pay unnecessary taxes. EPISODE HIGHLIGHTS: (0:51) News: Rivian went public at a targeted $54 billion valuation but due to strong demand debuted at a $91 billion valuation. (1:17) Pfizer has created an antiviral pill that reduces the risk of hospitalization from COVID and is pending FDA approval. (2:00) Economic data for the economy is slowing and Congress is debating Biden’s Build Back Better Plan that will increase taxes and is an increase of around $2 billion in spending. (3:55) Backdoor Roth contributions have been talked about being eliminated. This has been a great tax planning strategy over the last decade for those that took advantage. (5:17) Tax planning and investments should go hand in hand. Wall Street brokers cannot legally give tax advice. (6:05) Tax loss harvesting and how it benefits the client. (7:30) Systematic planning over the long-term adds up to significant tax savings and large account balances. (8:28) Understanding tax planning when gifting can increase the impact for the charity and save taxes for the client. (9:00) Goldman Sachs gives zero thought to tax planning. Unnecessarily realizes gains to the detriment of the client. (9:45) Separation of duties doesn’t work in the real world. Your CPA isn’t checking the work of your investment advisor. Find an auditor if you want to catch fraud. (10:54) Chase Carlson and other fraud attorneys evaluate if you are being taken advantage of. (11:34) The wealthiest families have a multi-family office that integrates tax strategies and investments. (12:18) Even if you're not ultra-wealthy, an independent RIA that integrates tax planning will be to your benefit.
Tue, November 09, 2021
Efficient Markets in Action | Brandon Averill, Justin Dyer | AWM Insights #86
Public markets are efficient, meaning they price in all public information almost instantaneously. This was proven once again this week when Peloton reported earnings and immediately dropped 25%. Then, Zillow reported they were exiting the house flipping business and promptly dropped 22%. These were unpredictable news events that were immediately incorporated into the stock price. Private investments do not have this same efficiency. Those with the right access to the best investments have a huge opportunity to create and sustain generational wealth with such an illiquid asset class. When it comes to the public markets, success is achieved by investing in a diversified and data driven way across the world, and always staying long-term oriented. EPISODE HIGHLIGHTS: (0:32) News: Braves win the World Series. Payroll number beats expectations and lifts the market higher. Very good news for the US Economy, which also brought unemployment down to 4.6%. Central banks have begun pulling back some stimulus and normalizing operations. (2:27) Earnings season is underway. Peloton, a COVID winner, dropped on weak forward guidance. (3:45) Zillow is exiting the house flipping business after losing money and is unloading their current inventory of homes. (4:55) Efficiency of markets and news is immediately priced into the stock price. (6:30) Public markets are efficient whereas private markets are not. (7:30) Company forecasts are often wrong just as the analysts that follow the stocks are often wrong. They both cannot predict the future. (8:15) Zillow, with their large amounts of data, could not predict future home prices enough to make a profit. (09:40) Investors with access to asymmetric information, like exists in the private markets, creates an opportunity to earn higher returns. Only inefficient markets can provide that. (10:20) Realtors almost always tell clients their homes will appreciate but they are just guessing. (10:42) Penn National Gaming stock crashed because of one person in the company, Dave Portnoy. (11:00) The lesson at the end of the day is that for long term investors are rewarded as the world economy continues to grow. That is the bet with the highest chance of success. (11:33) Invest across the world, in a data driven and thoughtful way. If you can do that, ignoring the short term noise, you will have success.
Tue, November 02, 2021
The Portfolio for Multi-Generational Wealth | Brandon Averill, Erik Averill, Justin Dyer |AWM Insights #85
“Shirtsleeves to shirtsleeves in three generations.” This is the expression commonly used to describe the reality that wealth is rarely sustained past the third generation. Building wealth is extremely difficult in the first place, and lack of planning for the next generation can destroy wealth in a hurry. The families that have conquered this trend and sustained wealth for 5+ generations understand the expertise of a team of dedicated individuals working together to achieve success. This allows families to create legacy and impact - generation after generation. Multi-generational wealth demands loyalty and independence from those advising them. It requires full customization and individualization. It must be integrated to be effective, because a family has only one Net Worth , and only one After-Tax Return . EPISODE HIGHLIGHTS: (1:10) Market news: Alibaba has declined 344B in value recently. Tesla is the latest US company to achieve a $1 trillion valuation. Markets have hit new highs once again this year. (2:14) UBS third quarter earnings driven higher by fees from wealthy clients. High fee products sold to their clients are great for UBS but bad for their clients. (2:50) Facebook has renamed itself to Meta. CEO Mark Zuckerberg created a new holding company called Meta Platforms, Inc which includes Facebook, Oculus, and Whatsapp. (3:15) Elon Musk now has a net worth great enough to buy every NFL, MLB, NBA, and NHL team combined. This gives perspective on pro sports value relative to the wealth creation capabilities of the biggest companies. (3:30) Mark Zuckerberg, to his credit, utilizes a family office which eliminates many conflicts of interest, customization, and integration issues that plague the big banks and wirehouses (think Goldman Sachs, Morgan Stanley, Merrill Lynch, UBS). (5:15) The problem with risk tolerance questionnaires for investors. (6:20) Individualization and customization matters when building a portfolio. Cookie cutter model portfolios do not treat people as unique. (8:17) The business model of Wall Street is to serve the masses and plug and play investors into model portfolios while avoiding liability with risk tolerance questionnaires. (10:45) What a better solution looks like to maintain multi-generational wealth. Risk should be determined according to what success looks like for each client. Not a 5 minute survey. (12:25) Those investment advisors that are not held to the fiduciary standard are incentivized to take more risk because they are not legally obligated to do what is in the best interest of the client. They only have to recommend “suitable investments” which may or may not be the best for that client. (13:35) True customization only takes place at family offices and multi-family offices. It is too expensive for anyone else to of
Tue, October 26, 2021
Why am I Investing? | Brandon Averill, Justin Dyer | AWM Insights #84
The most important question when it comes to investing is the why? You cannot give good financial advice or make good investing decisions on your own without understanding what success looks like to you. Most financial advisors miss the most important question to ask their clients because they have too many clients to spend the necessary amount of time getting to know. They then invest them into one of their model portfolios that may or may not be what they need to achieve financial success. Money is a powerful tool that can be invested to achieve priorities and create multi-generational wealth. The impact on families can live on for generations when wealth is properly stewarded. Answering the why of any investor makes for a better investing experience. Even if generational wealth is not the desired outcome. EPISODE HIGHLIGHTS: (1:05) Market news: WeWork finally going public at a $9 billion valuation. Earnings season is in full swing and Netflix has created internal drama with the newest special by Dave Chappelle. Squid Game is also drawing huge amounts of interest in its first season. (3:05) Bitcoin ETF (ticker: BITO) launched and doesn hold Bitcoin directly but rather holds futures contracts in the fund. (4:15) Why should you even invest in the first place? (5:15) Money is a tool to help you accomplish your priorities. (5:35) Anyone giving you advice how to invest without knowing what you're investing for is giving poor advice. (6:20) Your why is incredibly important. Make your wealth work for you. (7:17) Investing is not speculation. Speculation is gambling and should not be confused with investing. (8:00) Invest to at least keep up or beat inflation and this maintains or increases your purchasing power. (9:25) Two different people have their own unique wants and needs and should not have the same portfolio. This is why customized investing according to priorities and not age should be how a portfolio is constructed. (11:30) A longer time horizon allows for investing in assets that have even higher expected returns. This can lead to even greater impact over a lifetime. (12:23) “Thinking of money as a tool in this framework should provide more comfort, understanding, appreciation, focus.” -Justin (13:25) Knowing your why and the impact you want to make with your money (the tool) then guides how the portfolio is built. (16:20) What does investing for impact mean to you? (17:10) There is a huge opportunity for change and impact that could be made if investors focused on achieving priorities versus chasing short term returns and fads. (18:45) It is unfortunate the industry is still tied to a risk tolerance survey and many people aren’t given the opportunity to invest according to their priorities. (19:00) The family office model allows for true customization and the great
Tue, October 19, 2021
How Should You Build Your Portfolio? | Brandon Averill & Justin Dyer | AWM Insights #83
In the previous two episodes of AWM Insights, we covered when the best time to invest your money is and where to look for your investment advice. This week we continue by discussing how you should construct a portfolio to achieve the returns you deserve. Every investor deserves a portfolio tailored to the priorities they want to achieve. Very few are able to get that advice because they are stuck with biased and stale Wall Street solutions. Liability driven investing matches what you want to achieve in your life with the systematic based investment to best reach the outcome. Taking smart and compensated risk is necessary, but so is protecting essential needs with the highest quality assets. Systematic active investing gives you a real chance to outperform the indexes in a structured and repeatable way over the long-term. ETFs, Mutual Funds, and Separately Managed Accounts can all add customization that achieves the results that are in your best interest and designed to meet their priorities in the financial plan. EPISODE HIGHLIGHTS: (1:45) Earnings have so far exceeded expectations. This is supportive of the market even with the volatility of unemployment claims and inflation data. (2:55) OECD countries have agreed to a global minimum tax. This is not a done deal quite yet but will have a big impact on global markets. (4:00) A crypto ETF has been approved by the SEC. It is not holding Bitcoin but instead futures. This means it will not track the underlying exactly. (7:20) Independent and integrated advice reduces conflicts of interest and does not encourage selling the products of the firm. (8:40) Indexes have very strict and established rules on what they can do. When the S&P 500 had to add Tesla, the move was telegraphed to the market. Just being a passive indexer forced you to be front-run by other investors. (10:00) Blending the world of active and passive can take the best of both worlds. It allows for smarter trading so that you don’t blindly follow an index. (11:00) Favoring factors that have outperformed over the long-term can create a superior portfolio that increases returns and reduces volatility over time. (11:30) Mutual funds vs ETFs and Separately Managed Accounts can all add customization that can achieve the results that are in the clients best interest to meet their priorities in their financial plan. (14:30) Private investments can be high-risk high-reward but staying consistent to taking smart risk wins over the long term. (16:09) Tilting the odds in your favor is the key to being a good investor. Having a plan and investing based on priorities in a structured way is simpler and more effective. (17:40) The odds of finding the next Tesla before they were popular are not in your favor. It's okay to buy individual stocks but you should not expect to outperform the market over the long-term. The
Tue, October 12, 2021
When Is A Good Time To Invest? | Brandon Averill, Justin Dyer | AWM Insights #82
Whenever you have the money, it is the best time to invest. The caveat is that you must have a customized, well thought out plan that you can stick with over the long term. The market will always give you an excuse to wait. The problem is that waiting has proven to cost investors sitting on the sidelines huge amounts every year. Markets are rallying this week on an agreement to raise the debt ceiling temporarily, the COVID delta variant is declining, and Russia is agreeing to pump more oil. Does this mean you should wait until markets go down? No, because without the structure and process to get invested, you will always find a way to put off investing until next week. When markets were going down aggressively as they did in March 2020, you would have said: “I’ll just wait until they go lower.” No one rings a bell for you that the market has bottomed. Calling market bottoms and tops is purely luck. Anyone telling you differently has something to sell you. Something to keep an eye on is the release of the Pandora Papers. This is a follow-up release to the Panama Papers by the International Consortium of Investigative Journalists. It is fascinating to see hugely influential world leaders and celebrities doing whatever they can to evade taxes. A key distinction here: tax avoidance is perfectly legal and should be implemented as part of tax planning for anyone paying large amounts of taxes. Tax evasion is never worth the risk, especially when you are high profile. EPISODE HIGHLIGHTS: (4:19) Markets are rallying from the recent sell-off because some of the uncertainty over the debt ceiling has been removed. Republican and Democrat leadership have agreed to fund the government through December. (4:35) Is now a good time to invest? It’s always a good time to invest. Markets reward investors over the long term. (6:10) Wall Street has a playbook of calling you when the brokers see markets decline. They then tell you to buy the dip like they alone can predict the future. This is salesman 101 trickery at its core. The reality is your investment plan should already be fully invested. Sitting on the sidelines is harmful to your financial priorities. (8:00) Returns have been above average so far year to date. Volatility is elevated but at historically normal levels. Markets will always give you a reason to wait to get invested. They are very good at appearing like they can’t keep going up. All of the data that exists for long term investors tells us otherwise. (9:30) March 2020 and the perfect time to invest. The problem is the entire world was shutting down and uncertainty of the future of the world economy was at its highest. It only now looks like it was a no brainer with the benefit of hindsight. (10:20) The real question is, when would you feel comfortable investing? Creating a financial plan and sticking to it with a long-term philosophy is how you ach
Tue, October 05, 2021
Where Should You Get Financial Advice? | Brandon Averill, Erik Averill, Justin Dyer | AWM Insights #81
There are millions of places to find mainstream investment advice across television, books, social media, newspapers, newsletters, and friends. The problem is that this advice is almost always inappropriate for you - and often objectively wrong or misinformed. The best in the world seek only customized financial advice specific to their own situation and free from conflicts that plague Wall Street. With markets experiencing a pullback from all-time highs, it is a good time to ensure your advisor has the expertise, experience, and structure to grow and maintain your family's wealth for the long-term. EPISODE HIGHLIGHTS: (2:00) The S&P 500 is up 16% year to date, 31% over the last one-year period, and 120% total return over the last five years. Perspective matters on pullbacks and corrections. (3:30) The world’s wealthiest family, The Walton family, worth around 238 billion, owns ETFs in their top 10 holdings. You don’t have to own individual stocks to grow and sustain wealth. (3:53) Tom Brady launches his clothing line and his 21 year age gap with Mac Jones. (4:50) Credit Suisse dumping the debt of Evergrande, the Chinese real estate company in danger of defaulting on their obligations, to their private wealth clients. (6:00) The first step of investing like a pro, assembled an expert team doing what's in your best interest. (7:45) UBS and other brokers do not have the ability to give tax advice. (9:00) Conflicts of interest in financial advice and what you can do about it. (12:00) Warren Buffet and the game he is playing. When he passes he has publicly stated many times that his wealth is going into index funds. He understands how hard it is to beat the market. (13:55) The financial media does not have your best interest at heart. They know what sells advertising space and will exploit that to the fullest. (15:30) The problem with Rich Dad Poor Dad and listening to amateur advice. (17:45) What does the data tell us about expected returns at all time highs? (20:50) How do you evaluate your true risks in investing and what gives you true control and clarity in your plan? (22:15) Why we believe so strongly in doing what’s in our clients best interest.
Tue, September 28, 2021
Market Predictions and Emotional Investment Decisions | Brandon Averill, Erik Averill, Justin Dyer | AWM Insights #80
Last week had the largest market down day of 2021, yet the markets finished slightly up on the week. What can and should you expect from the market? Markets moving up and down is normal and should be expected. As an investor, you will live through many rough market days. You will experience many fear and greed cycles. The key to weathering these storms is creating an investment game plan and sticking to it. You shouldn’t panic when the market is down 2%. Patience pays off in sports and in investing - you don’t bench your best player because they strike out once or twice. Emotions cause bad decision making, but staying rational can be easier said than done. It is why the plan is so important, because reacting can destroy your returns. EPISODE HIGHLIGHTS: 1:18 The news you should know: US households' net worth hit record highs and the largest increase in real estate holdings ever. 1:54 Congress looks primed to pass tax increases on corporations, individuals, and estates. The capital gains rate is slated to move higher and also the top tax rate. Tax minimization strategies are also being targeted for removal including the backdoor Roth IRA. 3:35 Evergrande, a real estate company in China, is in danger of defaulting on their debt. This creates uncertainty which causes volatility in the markets. When a company as large as Evergrande defaults it can cause shockwaves that impact other companies and markets. 5:30 Market volatility is a normal and healthy part of financial markets. If markets only went up and there was little to no risk then you would not be rewarded in the form of higher expected returns. Risk and return are always related. It is a basic foundation of investing. 11:00 No one is surprised when a hitter strikes out. It's a natural part of baseball and no one panics when it happens. This is no different than markets and the selloffs, corrections, and recoveries that occur every year. 17:00 Risk aversion is an investor bias of losses hurting more than gains. Sticking to your investment plan and controlling emotions allows you to capture the returns you deserve. 18:00 Herd mentality and why it feels good to be doing what everyone else is doing. If you follow the herd instead of your own investment plan, you will damage your wealth. 21:00 Be careful where you get your advice. There is no need to feel insecure like you should know how to invest. CNBC and other financial media are preying on your emotions to drive their advertising revenue. Professionals that give advice only in your best interest would be able to help you focus on what matters for only you. <stron
Tue, September 21, 2021
What Should You Do During Market Volatility | Brandon Averill, Justin Dyer | AWM Insights #79
With recent market dips, a common question that arises is: what causes market volatility? The answer is a complex set of circumstances determined by many market decisions, but the real question lies in what you as an investor should do in times of market volatility. Many headlines will prod a doom and fearful response, but what does the evidence show? In this week’s episode, Brandon and Justin discuss the many different factors that can cause market volatility and the best approach to getting the returns you deserve, tuning out the noise in temporary market downturns, and investing for decades with a portfolio structure built to meet your priorities. EPISODE HIGHLIGHTS (00:33) The news you should know: mixed economic signals before next Fed meeting, Biden’s proposed tax plan, Microsoft’s share buyback program, Federer’s IPO, Amazon offers college tuition at select schools for employees. (5:59) What’s going on in the market today? (7:29) Complexities of market volatility? (9:58) Guessing how many jellybeans are in the jar (11:46) The perils of market timing (14:23) You might get it right once or twice, but is it a repeatable process? (16:16) The good news is that you can participate in the greatest wealth building tool ever created (17:54) Measuring success in decades
Tue, September 14, 2021
The Diamond Hands Myth | Erik Averill, Brandon Averill, Justin Dyer | AWM Insights #78
Is picking individual stocks a good investment strategy? Yes, if you like not being compensated for a lot of risk…No, if you want to have an actual investment strategy. While a case could be made for individual stock selection 50 years ago, in today’s information age, any edge investors may have had decades ago has been eliminated. In this episode, Erik, Justin, and Brandon highlight the fallacies around having “ diamond hands ,” and being able to consistently pick the best performing stocks. EPISODE HIGHLIGHTS 1:02: The news you should know: El Salvador now recognizes Bitcoin as legal tender, but Bitcoin has not performed as well as expected since then. 02:25: Markets have been a bit rocky as many investors get cautious around additional market highs. The surge in the Delta variant could also be priced into investor hesitation. 03:02: It’s not out of the ordinary for markets to see corrections – it’s actually healthy. What is abnormal is perpetual all-time highs. 04:28: It’s still commonplace for investors to pursue finding the best individual companies to invest in. Wall Street has made a killing off selling which company stock is “hot.” 05:25: While individual stock selection has cemented itself as the default investment strategy for most investors, it is a horrible strategy when looking at the risk you’re taking. 06:16: Individual stock selection was easier 50 years ago when investors could gain an edge by digging through financial statements that were not as easily available to all participants. 08:40: Everyone wants to pick a home run, and the lottery fallacy says that if I get one selection right, I’ll be compensated for the losses I incurred waiting on my “home-run pitch.” 12:28: If I play the individual stock selection game, what I’m really saying is I know something about this one company that no one else knows. 14:48: There’s no real information advantage in the public markets, but there is certainly an edge to be had in the private markets. 18:39: Even with private investments, we still need to stick to the fundamentals. 20:06: If we can’t predict the future, then having a strategy that’s not predicated on predicting the future (individual stock selection) is essential. I have to be confident in my decision-making philosophy and stick to it.
Tue, August 31, 2021
Does More Risk Always Mean More Return? | Erik Averill, Justin Dyer | AWM Insights #77
Following our deep dive into risk on last week’s episode, we received a listener question asking if risk and return are always perfectly related. Absolutely not. Simply taking on more risk doesn’t lead to more success. There are different types of risks that are important to understand before introducing added risk into your portfolio. Erik and Justin continue the conversation this week to explain the differences in risk and the importance of making sure you’re compensated for the type of risk that you take on. EPISODE HIGHLIGHTS (1:30) The news you should know: Federal Reserve meeting, Rivian is going public, and social media stars who move markets. (6:24) While risk and return are related, not all risks are well compensated (7:50) You can never know 100% of the risk (8:56) The two important questions to ask (10:44) Taking calculated risk (12:45) Participating in owning companies over the long-term to capture the market premium (14:23) Why smaller companies generally outperform versus large companies (16:49) The evidence of well compensated risk
Tue, August 24, 2021
Risk Defined | AWM Insights #76 | Erik Averill, Justin Dyer | AWM Insights #76
Risk might be the most used word in finance. We hear it all the time, but many have no idea how to define or quantify it. The reality is that “risk” is an umbrella term with different types of risk folded underneath it. Though many will define risk in terms of tolerance, looking at it this way can stifle your long-term growth opportunities. Instead, it can be better to view risk as the permanent loss of money. How should you view risk in the framework of this definition? In this episode, Erik and Justin define risk, and more importantly discuss how you should view it within the context of your life priorities. EPISODE HIGHLIGHTS 1:04 News you should know: China purchases a 1% stake in TikTok’s parent company, and TikTok was the most downloaded app last year. Adidas sells Reebok to Authentic Brands, which owns Sports Illustrated and the licensing rights to Shaq’s name, image, and likeness. 3:03 Amazon continues to disrupt the market by opening good old fashioned department stores. 4:26 True risk is the permanent loss of money that you can’t use in the future to achieve your life priorities. This definition is different from how risk is traditionally defined by advisors. 5:06 Most of the financial world will define risk in terms of tolerance; can you sleep at night when markets go down? This measure of risk can stifle performance by keeping people from investing in assets that have higher growth over the long-term. 6:29 Risk and return are related. If I expect to earn more, I should also expect to take on more risk. 8:43 Risk also encompasses regulatory decisions. Governments can make decisions that permanently affect industries; cryptocurrency being a great example. 10:38 If you’re taking a concentrated risk in an individual stock or cryptocurrency, you better get compensated for it. Does my return justify my risk? 13:00 You can cherry-pick examples of individual stocks that have performed very well over the past decade, but what are the true odds of you finding the needle in the haystack? What’s the cost of picking the wrong one? 16:39 Your life priorities should inform your investment allocation. Essential needs should be invested conservatively, while long-term priorities can be invested more aggressively. 19:45 Liquidity risk is a measure of how easily you can have access to your money. You should demand a premium or higher return on investments that are less liquid. Investments that are less liquid pose an additional risk, which you should be compensated for. 22:14 Risk is unpredictable, we know events like 2008 can happen, but we certainly don’t know when they will happen. Having a protective reserve that includes your spending needs is essential. This is how you prepare for risk. 22:42 Sitting on the sidelines and not participating in the stock market is also a r
Tue, August 17, 2021
Tuning out the noise of the “All-Time High” | Erik Averill, Brandon Averill, Justin Dyer | AWM Insights #75
Everyday, thousands of investors tune into their favorite business news channels and hear pundits discuss trends in the markets. They see flashy tickers at the bottom of their screen and listen to famous people in finance give their outlook on what the future holds. While dramatic and entertaining, most of what they listen to is erroneous. Our favorite business news channels are in business to make a profit, and the more eyeball’s they can get on the screen, the more they profit. In this episode, Erik , Justin , and Brandon highlight why all-time highs are not as important as we think they are. They discuss how having an actual strategy is a much better predictor of investment success, and how trying to predict the future is a fool’s game. EPISODE HIGHLIGHTS: (00:16) The news you should know: Markets are at an all-time high, the S&P 500 which is an index that captures the 500 largest companies in the U.S. is up over 100% from the low 15 months ago. (00:52) Airbnb’s revenue is up substantially compared to where it was during the peak of the pandemic, but its stock hasn’t performed as its revenue says it should. Yet another example of the unpredictability of a stock’s performance, and why fortune-telling is a bad strategy. (01:29) Is it a good time to invest when the market is at all-time highs? (02:38) Stop listening to your favorite business news channels. They make money by getting eyeballs on the screen; not by being advisors. In reality, market highs are a common event. (04:26) Just because the market is at an all-time high, doesn’t necessarily mean that stocks are too expensive to buy. If investors believe that the market will perform better in the future than performance today, then a higher price is justified, especially if companies continue to earn and profit. (07:03) Again, our favorite business news channels are businesses themselves. They don’t have an intimate understanding of your unique situation. (08:26) Those with a plan catered to their individual priorities win. Trying to time the market is a fool’s game. (12:21) Focus on what you can control: managing taxes, mapping your spending, having a diverse lineup of investments, and most importantly, having a strong understanding of your priorities. (13:33) Markets are risky. They can move up and down swiftly and dramatically. This is the price you pay to participate. (16:13) Let’s call a spade a spade - individual stock picking is gambling. (17:38) You have two elevators, one is attached by one cable and the other is attached by five cables. Which one do you want to be on in the event of an earthquake? Obviously, the one with five cables. In the same way, you should have a wide range of U.S. and International s
Tue, August 10, 2021
Passive Income: Only for Real Estate Tycoons? | Erik Averill, Brandon Averill, Justin Dyer | AWM Insights #74
You see it all over the news and social media: wealthy people talking about how they generate monthly income without ever having to work. Purchase a home or rental property, then open your mailbox every month and collect a check. Rinse and repeat. Do you really need to become a real estate tycoon to build wealth? Is it really that easy? Of course not. In this episode, Erik, Justin, and Brandon highlight how to view passive income, and its role in building wealth. They discuss viewing it as a means to an end - the end being financial freedom. At the end of the day, wealth is what you take home after taxes/expenses, so it's important to have passive income conform to your priorities, and not the other way around. EPISODE HIGHLIGHTS (0:38) The news you should know: Good July jobs report, but it's more important to look at the trend; (1:37) Rihanna is now a Billionaire. How celebrities and are taking agency over their earnings; (3:21) Pepsi gets rid of Tropicana, and rebalances their portfolio of drinks. They objectively evaluate their drink lineup, which provides a good model for how people should evaluate their investment lineup. (4:46) Being financially free is the end goal. Being able to live life on your terms is what's important. Passive income shouldn’t be an end in itself. (6:52) Passive income v. Capital Appreciation. Judging a winner depends on net of cost return. (9:41) There's no bank teller in your home or rental property that can deposit cash on demand. (10:35) What you pay for an investment matters. Costs erode returns. (12:18) Risk and return are related. Does my return justify the risk? (14:29) Generational wealth is never built on a one-size-fits-all approach. Your priorities should inform your passive income allocation, not the other way around. (16:11) Rockefeller family case study. How they have built wealth through seven generations. Hint: It wasn't because they put all their money in rental properties.
Tue, August 03, 2021
Amateur vs Pro: The Importance of Asset Allocation | Erik Averill, Brandon Averill, Justin Dyer Insights #73
In your investment portfolio, you have the choice of making the amateur move – listening to the mainstream financial pundits who want you to feel FOMO over the latest stock picking craze – or the pro move of looking at how the best in the world do what they do, which is also backed by decades of research. We started this series a few weeks ago by focusing on overall financial structure and followed up last week with how to think about portfolio construction, and the result of that is the topic for this week – your asset allocation. Erik , Justin and Brandon define what asset allocation is, the complexity of asset classes, and how to avoid making the amateur investment moves. EPISODE HIGHLIGHTS (00:30) The news you should know: US stock market doubles, Robinhood goes public, paid vaccinations, drop in poverty, how much are Olympic medals worth? (3:57) What is asset allocation? Model portfolios? (6:35) Adding human capital into the mix (9:23) The complexity of assets (11:30) Amateurs vs Pros (12:40) “It's really unfortunate, because you do have the Robinhood's of the world, the big brokerage houses that we all know, and they're so focused on marketing and generating this activity, and playing on emotions, it's really unfortunate. Because the education out there, the buy, the sell, the Jim Cramer's, they're all trying to get you to focus on the tool, and the tool's not what's going to make you successful, the tactic. It's more about stepping back and looking at the whole.” – Brandon Averill (14:56) “That's the whole goal here, is to make sure your assets, your overall net worth, your total net worth, is structured in a way, is built in a way to support your priorities.” – Justin Dyer (16:01) “Am I allowing [mainstream voices] to get my emotions riled up, to use my FOMO against me, to extract dollars out of my pocket as an amateur? Or, do I want to take a step back, and do I want to look at the best in the world at what they do? Because that's who you are as an audience. You're a professional athlete, you're a founder, you're a business owner, you're a wealthy individual, who has gotten that way by being a pro.” – Erik Averill (17:24) How are you measuring investment performance?
Wed, July 28, 2021
The Toolbox of Portfolio Construction | Erik Averill, Justin Dyer | AWM Insights #72
One of the most important aspects of reaching your financial priorities over the long term is portfolio construction. Just as important as putting the right players in the right positions on the field is the importance of understanding and utilizing the full toolbox for building your customized portfolio that takes into account all the complexities of your specific situation. In this week’s episode, Erik and Justin discuss the basic building blocks of portfolios, avoiding amateur mistakes, and why your portfolio should be customized to you and your priorities – not some cookie-cutter model. EPISODE HIGHLIGHTS (00:44) The news you should know: Delta variant, Olympics kick off, Taleb thinks Bitcoin is worthless (2:44) The building blocks of portfolios (7:48) A customized approach (8:21) Constructing the right lineup and avoiding amateur mistakes (11:27) What we’ve learned from endowment models (14:36) Is there a CFA constructing my portfolio? (15:03) Are you getting comprehensive advice?
Tue, July 20, 2021
Human Capital Realized – Now What? | Brandon Averill, Justin Dyer | AWM Insights #71
We believe that the greatest driver of your net worth is your human capital. But what about when you reach the phase in your life when you’ve converted all or the majority of your human capital into resources? What are some of the considerations you should be making in relation to your overall financial structure? This week, Brandon and Justin discuss what to do when you’ve realized all of your human capital including the moves you should be making, tax implications to consider, setting up your priorities for life, and why in the long run financial structure matters more than individual investments. EPISODE HIGHLIGHTS (00:41) The News You Should Know: Delta variant, no spectators at the Olympics, Robinhood valuation, index funds are 50, earnings seasons is here again (2:12) When your human capital has been converted to resources, what are some of the things you should be considering? (5:27) Minimizing taxes, charitable giving, and setting your priorities (7:21) A better strategy than using a Monte Carlo simulation (8:17) Matching assets with priorities (11:11) This is a process not an event (13:56) Your financial structure matters more than the individual investments that you choose (15:21) Financial structure should be customized to you and your priorities
Tue, July 13, 2021
Illiquidity Premiums in Real Estate and Private Equity | Erik Averill, Brandon Averill | AWM Insights #70
With the all-time market highs that we’re seeing despite fears of inflation, we’re also continuing to see the popularity of real estate investing and venture capital private equity. But whether you just dip your toe in or dive in headfirst to these kinds of investments – are you getting the returns you deserve? When investing in these spaces, they require more patient capital that can’t be pulled out very quickly. This is known as illiquid assets and can sometimes get a negative rap. However, we think illiquidity can be a great thing as long as you’re being compensated for it. This concept – known as an illiquidity premium – is the focus of Erik and Brandon’s discussion today where they discuss what it is, why it can be a good thing for investors, and the opportunity costs to consider of having your assets tied up in illiquidity. EPISODE HIGHLIGHTS (00:24) The news you should know: MLB All-Star Game, All-time market highs (2:14) What is the illiquidity premium and what does it apply to? (3:12) Illiquidity premiums in real estate and venture capital (4:46) How should investors look at illiquidity? (5:48) What are the opportunity costs of illiquidity? (8:29) What are interval funds? (10:19) Elevator analogy (11:16) What does risk mean to you?
Tue, July 06, 2021
The Greatest Driver of Wealth Creation | Erik Averill, Justin Dyer | AWM Insights #69
In the past year, we’ve seen a boom in entrepreneurship – with more businesses being created in 2020 than any other year in history, companies going public, and as of July 1st, the Mets paid Bobby Bonilla another $1M and we saw that now NCAA athletes are able to make money off their name, image, and likeness. What do all of these have in common? They all tie back to the greatest driver of your wealth: Human Capital. In this week’s episode, Erik and Justin discuss how to invest in yourself, control what you can control, and leverage the 3 pillars of Human Capital over the course of your career with the aim of attaining your financial goals and increasing your overall net worth. EPISODE HIGHLIGHTS (00:46) The News You Should Know: Bobby Bonilla Day, ByteDance platforms to reach 4M users, LegalZoom IPO, and NCAA NIL. (4:06) What is Human Capital? (5:03) The return on your Human Capital (8:23) The 3 pillars of Human Capital (11:09) Should you try to find the next Tesla? (14:23) The “Aha Moment” professional athletes have (17:07) “What makes me valuable?”
Wed, June 30, 2021
Hire the Architect: Building Your Financial Structure | Erik Averill, Brandon Averill | AWM Insights #68
With markets continuing their unpredictable ebbs and flows, one important piece of news emerged in a ProPublica article that reported Paypal founder Peter Thiel turned $2,000 in his Roth IRA in 1999 to now more than $5 billion. Its stories like this that highlight the fundamental importance of financial structure. We mention financial structure ad nauseum here at AWM, but what exactly do we mean when we say that? In this week’s episode, two of AWM’s co-founders, Erik and Brandon , discuss this topic and the framework of growing your wealth through sound financial architecture. EPISODE HIGHLIGHTS (00:32) The importance of financial structure - returns are only a part of your structure (00:58) All the market news you need to know Back to all time market high – so hard to predict which way market will go in short term Biden’s bipartisan infrastructure bill Peter Thiel’s Roth IRA going from $2000 to $5 billion (2:43) What do we mean when we say financial structure? (3:13) “What the wealthy understand is that your financial structure is really what matters.” -Brandon Averill (3:44) Even the smartest only succeed about 15% of the time (4:16) Financial Structure: Taking advantage to all the opportunities that are available to you and don’t increase your risk (4:50) Identify the outcomes you’d like (6:33) How financial structure is like building a home “When you’re building a custom home, you actually never start with, ‘What pieces of furniture are we going to put in the house?’” – Erik Averill (7:49) The actual definition of investing success (8:22) It starts with the architecture “The first thing you do is you hire an architect and say, ‘All right, what is the master plan of the home that we want to build?’” – Erik Averill (9:30) What are your advisor’s motivations? (10:54) Would you gamble in Vegas with a 15% success chance? (11:30) What the world’s biggest Wall Street firms can’t tell you (12:34) Nassim Taleb’s book “ Skin in the Game ” (13:56) The real purpose of money (14:26) Don’t put your earnings at risk (15:24) “ Winning the Loser’s Game ” by Charles Ellis and “ Goals Based Wealth Management ” by Jean Brunel.
Tue, June 22, 2021
What Is The Fed and Why Should I Care? | Erik Averill, Brandon Averill, Justin Dyer | AWM Insights #67
This week we’re tackling the topic of the Federal Reserve, Inflation, and why these are important to you as an investor. It seems like this topic has come up out of nowhere in the last couple months, and we’re actually now seeing the markets react. After the Federal Reserve signaled that the central bank could start to raise interest rates to try and tame inflation earlier than they had originally projected, we saw the global stock market consolidate and have its worst week since October. As a result, voices in mainstream financial media have suggested many different moves to make in your portfolios. But, should you listen? Further, as an investor, should you care about potential rising inflation or interest rates? And how might the Fed’s moves impact you? Brandon, Erik and Justin discuss these questions and more in this week’s episode. EPISODE HIGHLIGHTS (1:00) The market news you need to know: The Fed signaling, Timber rates drop, crypto warnings (2:56) What exactly is the Fed? “We go to banks to get loans, whether that be a commercial loan or a private loan or a mortgage to buy a house. Well, where did the banks go?” – Justin Dyer (3:42) Why the Fed was created (4:45) Why does the Fed fluctuate interest rates? How does that impact inflation? (6:44) The balancing act of the Fed’s dual mandate (8:13) With potential rising interest rates, how should I react as an investor? “The worst thing that you could do is panic, take your money, throw it, dig a hole in the backyard and put it in the ground or leave it even in cash right now, where cash is yielding next to nothing for your long-term priorities.” – Brandon Averill (11:30) Structuring around uncertainty (13:36) Are there certain types of investments that do better in an inflationary period? Should we start to predict that and move our portfolios there? “We're harping on what the fed might do. The fed hasn't done anything yet. And so we're really going to make decisions based upon something that we think might happen? I think that's where you just really get yourself into trouble.” – Brandon Averill (16:14) Matching the cost of your priorities with the timeframe that you want to achieve them. (17:21) The bottom line
Tue, June 15, 2021
Is Inflation Here to Stay? | Brandon Averill, Justin Dyer | AWM Insights #66
The most recent Consumer Price Index (CPI) report shows a continued rise in inflation – the fastest pace of higher prices since 2008. So, while it’s safe to say we’re seeing some inflation as the economy continues to recover from the impacts of COVID, the big question to ask is if inflation is here to stay? In this week’s episode, AWM’s managing partner, Brandon Averill, and CIO, Justin Dyer discuss the signs of transitory inflation and some of the best ways to build your portfolio to protect against periods of rapidly rising inflation. EPISODE HIGHLIGHTS The market news you need to know (00:48) Is inflation here to stay? (2:30) What is transitory inflation? (3:21) Why it’s impossible to buy a bicycle right now (4:26) What Brandon would say if he was a conspiracy theorist (8:29) Some of the best ways to prepare for inflation (10:10) In-N-Out burgers and the importance of participating in the ownership of the market (11:07) Why deflation can be disastrous for the health of the economy (13:04) Portfolio building that helps to hedge against rising inflation (15:07) How to cut through the noise of the financial media (16:38)
Tue, June 08, 2021
How Does Inflation Impact Investment Portfolios? | Brandon Averill & Justin Dyer | AWM Insights #65
Recent reports have shown jobless claims falling to new pandemic lows and wages growing, but there are also some indicators that prices might be ticking up as well – potential signs of inflation. The Consumer Price Index (CPI) rose by 4.2% from a year ago, which is the fastest rise since September 2008. With the updated report being released later this week, many investors are watching to see how the Fed will respond. But how should you respond to the potential of rising inflation? Does it always signal bad news for the individual investor? Is rising inflation always bad? On this week’s episode, Brandon and Justin discuss what inflation is, how it’s measured, and its potential impacts on your portfolio. EPISODE HIGHLIGHTS Brandon and Justin discuss the latest market news (00:36) What is inflation? How does it impact us and our investment goals? (1:58) Consumer Price Index (CPI) vs Personal Consumption Expenditures (PCE) (3:13) “Some amount of inflation is actually good. It drives economic growth and development and it prevents people from just sitting on their money.” -Justin Dyer Inflation vs Deflation (4:23) Hyperinflation: When inflation becomes damaging (4:36) The current debate – is inflation here to stay or temporary? (5:29) “And the big debate in the marketplace is: okay, there is inflation, but is it going to be persistent? Or is this just a temporary spike in inflations that’s a result of the sugar high from money being printed to try and solve and deal with the problems from COVID?” – Justin Dyer The arguments from both sides (7:51) How we prepare and protect our clients against rising inflation (8:36) “We don’t have to predict inflation. We just have to be prepared for it.” – Brandon Averill Is inflation a bad thing for investments? (12:54) The bottom line (16:10) Read: How Does Inflation Impact Investors?
Tue, June 01, 2021
Is Real Estate Investing Better Than Stocks or Gold? | Erik Averill & Justin Dyer | AWM Insights #64
Real estate markets around the country are booming – home values are skyrocketing, demand is high, inventory in many places is low, and many are wondering if they should be getting in to real estate investing. We’re frequently asked about this form of investing from our clients, and many wonder if this is a “safer” form of long-term investing than the stock market. In a recent Gallup poll, the majority of investors surveyed believed that real estate is actually a better long-term investment opportunity than stocks, gold, and any type of savings account. Erik and Justin discuss this topic in this week’s episode and tackle the most frequently asked questions we receive, and some of the biggest things people can miss when entering into this type of investing. EPISODE HIGHLIGHTS Recent Market News – Amazon buys MGM, US Treasury on Crypto, NYT set to buy The Athletic? (00:56) A majority of investors believe real estate investing is a better long-term investment than gold or stocks (3:24) What kind of real estate investments? (4:32) Should I think of my primary residence as an investment? (5:20) Is real estate investing “safer” than investing in the stock market? (9:20) What is a “carry”? (12:04) Risk vs Return in real estate (12:56) How leverage factors in (15:23) You are competing against professionals (20:34)
Tue, May 25, 2021
Jumping Into The Deep End? Learning How To Invest | Brandon Averill, Justin Dyer, Zach Miller | AWM Insights #63
There’s been plenty of conversations online, in the media, and in locker rooms about which stocks to buy and why crypto is a sure bet, but how do you sift through the FOMO and educate yourself enough to form your own wealth plan? One of the most asked questions our team gets is how to actually go about getting educated on investing – how to set learning goals, available resources to tap into, and more – so this week, Brandon and Justin are joined by Super Bowl champ turned advisor Zach Miller to discuss this topic in depth. Episode Highlights The big events happening in the markets (00:59) Should you just open a Robinhood account and start trading? (1:49) The first question to ask (2:28) What is investing? (3:00) “Investing is taking your hard earned capital, usually from your human capital, those hours, the effort you've put in on the field, off the field, in the boardroom, starting your company, whatever the case may be, converting that into financial capital and putting it into the markets so the market can use it in its most efficient way to further grow companies and the economy, that is investing” - Justin Dyer Day trading vs Investing (3:32) “Why are you investing? Are you actually investing for a reason? Are you just trying to get returns? Because if you’re just trying to get returns, you’re going to be taking a lot of risks that maybe you don’t know, and don’t understand.” -Zach Miller (6:25) Financial FOMO talk in the locker rooms Playing catch at a tailgate vs playing in the NFL (7:02) The resources to learn how to invest (7:45) Minimizing the FOMO (9:11) Investing for athletes (11:06) “Why should I expect to have any additional insight into the future of Apple than the other 50 analysts who are covering that individual stock?” -Justin Dyer (12:38) Who are you playing against? (13:57)
Tue, May 18, 2021
Tesla, Crypto, Inflation & Investing Like a Pro | Erik Averill, Brandon Averill, Justin Dyer | AWM Insights #62
Last week, three main stories sent shockwaves through the markets stoking anxiety for investors going forward. Elon Musk shocked the crypto world announcing Tesla would not accept Bitcoin for the purchase of their vehicles. Colonial Pipeline — operator of the nation's largest fuel pipeline network experienced a cyber-attack that sharply drove up the cost of gas nationwide. U.S. consumer prices jumped to the fastest pace since 2008 stoking fears of rampant inflation in the future. Listen in to this week’s episode as we breakdown the implications for your portfolio and how to bulletproof yourself from the amateur mistakes being made in the markets.
Tue, May 11, 2021
Do You Know What Returns You Should Expect? | Brandon Averill, Justin Dyer | AWM Insights #61
At times investing can seem like a black box. And today, it may feel like you are the only missing out on astronomical returns. Yet, nothing lasts forever. It is important to remind yourself for every Crypto speculator who hit the lottery, there are thousands of other tickets that never hit. The good news is that you can don’t need to bet on the lottery for financial success. You simply need to understand, implement, and stay disciplined to what delivers returns time and time again. Listen in as we break down the building blocks of returns and how to build a portfolio based on evidence not luck. EPISODE HIGHLIGHTS ( 03:08 ): The building blocks of investment returns ( 09:01 ): What leads to out performance ( 13:32 ): The business model of venture capital
Tue, May 04, 2021
Should You Keep Investing in What’s Winning Now? | Erik Averill, Justin Dyer | AWM Insights #60
Investment returns continue to soar higher across the world in both the public and private markets. Should your future investments go into what has been doing the best recently? While this seems like a prudent approach, the famous disclosure, “Past performance does not guarantee future results” that is plastered everywhere offers a strong warning. Listen in as we answer how the current performance should impact your future decisions and how to Invest Like a Pro. Key Highlights ( 02:35 ): Market Performance Overview Year to Date ( 05:51 ): What the disclosure, past performance does not guarantee future results mean? ( 07:36 ): Performance sells ( 11:19 ): Why invest in fixed income? ( 14:41 ): What the evidence says drives returns ( 19:22 ): Why valuations matter
Tue, April 27, 2021
Biden’s Capital Gains Tax Increase? What Can You Control? | Erik Averill, Brandon Averill, Justin Dyer | AWM Insights #59
Last week, President Joe Biden revealed his proposal to increase the capital gains tax on the wealthy, potentially forcing them to pay up to 43% on investment gains. The sticker shock is real. Yet, we believe taxes are not the only risks to investors. It is the failure to control what you can control and making risky decisions that, at best, are hopes and dreams. Listen in as we discuss what you can control throughout the investment process and avoid the biggest mistakes we are seeing investors make across the public markets, real estate, and crypto. Key Highlights ( 03:05 ):The most important question when investing ( 06:37 ): The lottery and Dogecoin ( 08:37 ): Foundational principles of every successful investment ( 15:20 ): Do you want to be Famous or Wealthy? Resources 10 Keys To Investing Like a Pro What’s Happening In The Markets Dogecoin army’s campaign to drive crypto to $1 was a bust Top Combined Capital Gains Tax Rates Would Average 48 Percent Under Biden’s Tax Plan Senate Republicans propose $568 billion infrastructure plan to counter Biden First-time claims for unemployment insurance pandemic-era low .
Tue, April 20, 2021
Market Timing? When to Get In or Out | Erik Averill, Brandon Averill, Justin Dyer | AWM Insights #58
Crypto, real estate and the public stock market continue to roar upward. Can it last forever? Are we close to a bubble? Should you think about getting out? Or should you invest more? Making the wrong decision will severely impact your returns and history shows it is extremely difficult to make up lost ground. Listen in as we discuss what the professional investors know and how to avoid being the fool. Download the 10 Keys To Investing Like a Pro at awmcap.co/insights58 Key Highlights: ( 05:38 ) Revisiting March 2020 Correction ( 08:50 ) The True Value of An Advisor ( 12:52 ) How To Know If You Are Gambling or Investing ( 13:49 ) The Greater Fool Theory ( 17:17 ) Out Performance in Private Markets Resources The Greater Fool Theory Explained What’s Happening In The Markets Stocks End Week With Fresh Records Coinbase goes public with a nearly $100 billion valuation Bitcoin stumbles on Turkey’s central bank ban on cryptocurrencies Not a joke anymore: Dogecoin, the cryptocurrency created as a spoof, sees its market value top $40B Bernie Madoff, Architect of Largest Ponzi Scheme in History, Dead a
Tue, April 13, 2021
Missing Significant Tax Savings? Pro Strategies: After-Tax Investing | Erik Averill, Brandon Averill, Justin Dyer | AWM Insights #57
Most people don't like to pay taxes and try to find every loophole there is. But when it comes to investing, most investors are paying taxes they don't have to. As an investor, you care about one thing: your after-tax return. Because you have one net worth, and you have one effective tax rate. And you only get to spend, grow, or give after-tax money. Listen in as we discuss the most significant tax savings strategies that research has shown to add 2.57% of annualized returns . Key Highlights 02:52 President Biden’s Proposed Corporate Tax Plan 05:08 Why Investors Overpay in Taxes 06:06 How Your Financial Advisor is Hurting Your Returns 08:15 Gross Returns vs After-Tax Returns 09:45 Asset Location 11:09 Turnover 11:54 Tax-loss Harvesting 14:54 Research shows potential 2.57% of additional annualized returns Resources <a href="http://trk.klclick1.com/ls/click?upn=OiWeBgvZ8v721GqiRlPhNENRlDRU5qOv-2F5B2UUnwP2-2FADsabOTE7cgW22kcQxrC7oJrFcPga1rnoN7t1w6XZHjojj39ZGI1Y4DlPxTDkyel3afIpKCI-2B5RbNwPumZgWn-2BQq1R8yLfL4vAl5MvoGmuT-2BcFNHyq-2FgrmuFXZ-2B-2BUhxY4L0eNGWt1qkNTr84KB5WQVwT1k43XrGt6qRsWpS5MCL1I4cwAORGsY-2FBKocsQyaUPkymQHde4wNJz-2F9IsiCjB6wgG9MqI7w1UnQd-2F-2FCuTUWeZuUaLqkKXl0NZWrW4wrvwUGfWQfLcEyGAsInxyNWUHRUhb81MbcdJrhMLxI3PsIVgyluGA4PeBZSzPJ64aXs-3Db-BT_ClsfYCpV-2BnuFen1y8WZ
Tue, April 06, 2021
Key #1 to Investing Like a Pro | Erik Averill, Brandon Averill, Justin Dyer | AWM Insights #56
The S&P 500 hits a record high, Bitcoin continues to climb, real estate is exploding, and yet the questions of higher taxes, inflation and a bubble loom. Headlines seem to elicit either fears of missing out or fears of inevitable doom. You have worked hard for your money and rightfully so, want to make sure you are making the best decisions. Listen in as we discuss the #1 Key to Investing like a Pro and what the most recent headlines mean to you. Bonus Resource: Download 10 Keys to Investing Like a Pro at awmcap.co/insights56 Episode Highlights ( 02:25 ) Should You Invest In IPOs? ( 06:52 ): The Media’s Business Model ( 09:34 ): We Want To Buy Your Next Cup of Coffee ( 10:26 ): Why Investing In What You Know Can Be Dangerous Advice
Tue, March 30, 2021
Invest Like a Pro | Erik Averill, Justin Dyer | AWM Insights #55
Can hiring skilled active managers help you outperform the market? The premise of active management is that with enough skill, one can consistently outperform the market, or the benchmark on a risk-adjusted basis. Active managers boast their strategies can deliver. What does the evidence say? For the 11th consecutive one-year period, the majority (60%) of Active Large Cap funds underperformed the S&P 500. The long-term stats are even worse, 70%+ underperformed over 10 years and 85%+ over 20 years. This is pervasive across all public asset classes and markets. The verdict is clear, relatively few active managers add real value. The evidence supports that markets seem to be very efficient, are unpredictable, and are hard to beat through individual stock picking and market timing. But it doesn't mean you can't beat the market. At AWM, we believe portfolios can be designed and managed that can outperform the market without having to out guess it. Listen as Erik and Justin discuss how to avoid the traps of active managers and implement what you can do to capture the returns you deserve. Timestamps (00:54) One year since the Covid market bottom, drop in unemployment numbers, and other investment and financial news from the week (2:08) Tax implications of cryptocurrency (4:01) How important are professional active managers in the public markets? (4:58) Looking at the data (10:02) Can you figure out who will outperform in public markets ahead of time? (11:19) Should we all just move to passive investment? (15:23) A better option than paying for active management (16:33) What are value drivers in the world of investing? (17:36) The importance of portfolio management rules (18:36) Why you need an independent advisor – not Wall Street. More resources at awmcap.co/insights55
Tue, March 23, 2021
Beeple’s NFT Sells for $69 Million – Should You Get In? | Brandon Averill, Justin Dyer | AWM Insights #54
In this episode, Justin and Brandon discuss the week in finance and investment news including the $1.9 trillion stimulus that recently started getting divvied out, a “status quo” Fed meeting, and new inflation worries riding on the tails of a slight interest rate jump. However, the big news this past week – and our main discussion for the episode – is of the digital artist Beeple selling his work The First 5,000 Days as an NFT (non-fungible token) at Christie’s for $69.3 million. Christie’s reported 64% of the bidders for this digital piece of art were under the age of 40. The NFT excitement has hit new highs and we’ve had clients asking about whether they should incorporate them into their portfolios. Justin and Brandon discuss what exactly an NFT is, the arguments from crypto maximalists, and the biggest questions to consider before getting into NFTs, Bitcoin, and other cryptocurrency. Episode Highlights (2:13) How are we helping our clients implement their desire to be in the NFT space? HBO’s Last Week Tonight’s John Oliver describes NFTs as “Everything you don’t understand about money combined with everything you don’t understand about computers.” (3:17) What is an NFT? (4:13) Beeple’s NFT The First 5000 Days sells for $69 million (5:31) Should you be a crypto maximalist? (7:02) The valuation formula (9:13) The two reactions to Beeple’s NFT sale (9:56) Questions to consider before getting into NFTs and cryptocurrency (13:24) Should you just stick your head in the sand? (15:11) Bitcoin’s fork (18:14) Getting your priorities in place More info at awmcap.co/insights54
Tue, March 16, 2021
Capturing Outsized Returns in Private Markets | Brandon Averill, Erik Averill, Justin Dyer | AWM Insights #53
In this episode, we take a break from the usual discussions of financial and investment news over the past week to take a deeper dive into private markets. With all the excitement over the past year around individual stock picking, the entrance of new forms of cryptocurrency and NFTs (non-fungible tokens), we thought it’d be good to spend some time on private markets because we think they are where you can capture some of the highest drivers of returns. Justin, Erik, and Brandon discuss what private markets are and why they typically capture some of the highest returns, whether skill is a factor in private markets, and getting access to the best deals. Episode Highlights (00:12) Going deeper into the private markets (1:38) The additional risks that come with private market investing (4:07) Are public markets more attributable to luck or skill? (4:40) Out performance in the private markets (5:09) “Not all venture, not all private equity, is created equal.” – Brandon Averill (7:17) Due diligence questions to ask (9:18) How do we actually get access to the top 25%? (9:48) The building block considerations (13:01) Understanding your finance goals (15:24) Putting it all together in a holistic integrated plan (15:44) What factors should be in place before you consider entering private markets? (19:52) Types of private markets More resources at awmcap.co/insights53
Tue, March 09, 2021
Should You Invest in Dave Portnoy’s BUZZ ETF? | Brandon Averill, Erik Averill, Justin Dyer | AWM Insights #52
The most recent jobs report was released last Friday with data looking far more positive than previously predicted, which seems to suggest the economy is recovering. However, as we’ve discussed before , the economy and stock market are not connected. So, while the jobs report pointed to good news, the NASDAQ dropped four out of five trading days last week with big companies like Tesla, Apple and Netflix taking a downturn. In the midst of market downturns, Dave Portnoy of Barstool Sports announced the launch of BUZZ ETF, which uses AI to track popular stocks, and has encouraged people to buy in. Is this technology and methodology new? In our world of media personalities like Portnoy telling you how and where to invest your money – who should you trust? In this week’s episode, Brandon , Justin and Erik break down the financial and investment news from the past week, dissect BUZZ ETF, and discuss how to set up a long-term financial framework that works. EPISODE HIGHLIGHTS (1:55) Why the Dave Portnoy ETF news made Brandon smile (3:34) Why you should take your source into consideration when it comes to investment advice (4:14) Is Portnoy doing the same thing he said he was fighting against? (5:09) Trading on “Momentum” (8:24) Should likelihood of success factor in investment decisions? (10:21) Are celebrity endorsed products special? (12:20) How to reorient in the midst of the marketing/advertising machine information age (13:39) What research says about how often the stock market “performs” (14:41) Headline stocks like Tesla, Apple and Netflix take a downturn (16:22) Why we don’t just sharpshoot specific companies (18:02) What are the sources of return ? RESOURCES https://www.dimensional.com/us-en/insights/tuning-out-the-noise https://www.mydimensional.com/video/2294/independent-objective-advice https://www.mydimensional.com/video/2437/the-value-of-advice
Tue, March 02, 2021
Cutting Through the Investment FOMO | AWM Insights | Financial and Investment News
Are there days you feel like everyone is making money, except for you? The stories of friends turned day traders, the insane rise of the NBA’s Top Shop NFT (non-fungible tokens) craze and of course, Bitcoin skyrocketing can leave even the most seasoned investor with a bit of FOMO. Open Twitter, Reddit or YouTube and everyone is spewing advice on what to invest in next. In this information age, there is practically an infinite number of places and people giving financial advice. As Warren Buffett famously says, “It’s only when the tide goes out that you learn who has been swimming naked.” Everyone appears to be an expert until they’re not. How do you know who to trust? We breakdown the answers in this week’s podcast. Episode Highlights ( 02:33 ): Where are you getting your advice? What are their incentives? ( 04:32 ): Study of where people go to for their investment advice ( 08:32 ): Questions you should ask before accepting advice ( 15:50 ): How to conduct real due diligence on investment advisors ( 22:04 ): Advice every investor deserves
Tue, February 23, 2021
How To Practically Think About Risk and Return | AWM Insights | Financial and Investment News
It’s been another eventful week in the markets with a stronger than expected earnings season, Bitcoin continuing to reach new highs despite China testing their own digital currency called the e-yuan, and a SPAC bonanza . As mentioned last week , Erik , Brandon and Justin spend the majority of this episode discussing how to think about risk, return and allocating capital over the long-term including a framework of how to practically think about risk and return, how to approach long-term investing like a pro, and why ultimately your outcomes matter more than participating in the latest investment fad. Episode Highlights (2:04) How to practically think about risk and return (2:46) The basic valuation formula (3:57) Valuing uncertainty (6:23) The building blocks of risk (7:19) Equities (9:13) Municipal bonds (12:08) Interest rates impact (16:33) Will we return to normal at some point? (17:13) Resource: Josh Brown, The Reformed Broker (18:24) Engineered risk (19:16) Manager skill
Tue, February 16, 2021
What Fantasy Sports Can Teach You About Investing | AWM Insights | Financial and Investment News
While every front office executive surely doesn’t look like Brad Pitt in Moneyball, sports are now driven by analytics. Why? Teams are trying to figure out a way to predict who is going to be successful inside the structure of the given game. How to construct a portfolio, i.e. a team of players that's going to produce wins that results in profits for the company (team). Teams are investing millions of dollars into players for a desired return. Analytics removes the guesswork. Players are chosen based on data not emotion. The data explains what “drives return.” Juxtapose that with fantasy sports. Fans fill their fantasy teams based on familiarity, gut feel and likability. There's a big difference between you running your fantasy team and the front office of the Seahawks. It’s amateur versus professional. The professional relies on the analytics, the evidence, the drivers of return. Sound familiar? Listen in as we breakdown the pro moves surrounding Bitcoin, day trading and the markets. Episode Highlights ( 2:14 ): How Many Traders Make Money? ( 5:0 2): Where do returns really come from? ( 7:05 ): Fantasy Sports & Investing ( 10:23 ): Why we invest. ( 14:11 ): Keys to being a successful investor More resources at AWMInsights.com
Tue, February 09, 2021
Market Highs, GameStop’s Historic Drop, How To Win the Stock Market Game | AWM Insights | Financial and Investment News
Last week we saw the S&P 500 close with its best week since November 2020. We also saw GameStop plunge 80.4%. How can these two things exist at the same time? Is the market broken? Is it too risky? To the contrary, the stock market is still and will most likely always be one of the greatest ways to grow generational wealth. However, not everyone will succeed. Those who approach investing as amateurs are most likely to meet the fate of the gambler headed to Vegas. The good news, the house has taught us how to win. Today, Brandon, Erik & Justin layout the fundamentals of how to build your wealth. They specifically discuss stacking the deck in your favor so that YOUR house always wins. Episode Highlights ( 03:20 ): The economy is not the market. ( 04:16 ): Is the market broken? ( 05:57 ): The fundamentals of building wealth. ( 09:51 ):What is the stock market? ( 13:46 ): No such thing as a free trade. ( 16:27 ): Passive Income and Equity. ( 18:21 ): Ownership is the key to wealth. ( 19:26 ): Is the market a casino? ( 20:20 ): Probability of stock market returns. (<a href="https://www.rev.com/transcript-editor/Edit?token=BcM1SWI-78yYVrJ1vQBDeNIz9fdlP
Tue, February 02, 2021
Gamestop, Robinhood & Crypto | AWM Insights | Financial and Investment News
There is only one topic we can possibly talk about this week. It has set the investing world ablaze. It's GameStop, AMC, Robinhood, meme stocks, hedge funds, short squeezes, and of course good versus evil - retail versus Wall Street. On today’s Insights podcast, Erik, Brandon and Justin cover everything you need to know ranging from, “is this a once-in-a-lifetime opportunity?” to “how the best investors in the world are responding” and everything in between. The investment world has been changed forever. Listen to today’s episode to understand why. Episode Highlights ( 00:59 ): What is a hedge fund? ( 02:32 ): What is a short? ( 04:49 ): What are options? ( 07:25 ): How the Gamestop saga started. ( 10:05 ): Why we are wired to do everything wrong in investing. ( 12:02 ): Trading versus investing. ( 12:59 ): Are you a pro or an amateur? It applies to both trading & investing. ( 17:01 ): Investing versus speculating. ( 20:46 ): What’s a short-squeeze? ( 26:29 ): Is it ever appro
Tue, January 26, 2021
Biden’s Executive Orders, ESG Investing & Your Portfolio | AWM Insights | Financial and Investment News
President Biden wasted no time making international news. With the third executive order of his new administration, President Joe Biden put the US back into the Paris Agreement. President Biden also pledge $2 Trillion toward creating a clean energy future. In tandem, Christina Figueres, the creator the Paris Agreement joins the board of Impossible Foods. With companies and governments focusing on climate change how should that impact the way you invest? Research shows the answer could mean higher returns with less risk. Sound too good to be true? Listen in on this week’s AWM Insights, as Erik, Brandon and Justin dive into what is ESG Investing, how it can potentially drive higher returns and what Biden’s future plans may mean to your portfolio. Episode Highlights (03:49): Justin defines ESG Investing (06:34): Erik discusses how, where, and what we invest in goes far beyond financial returns. (10:12): Research shows there's no financial trade-off in returns and actually demonstrates lower downside risk when implementing ESG Investing. (12:56): Do you have a purpose of how we're deploying your family's capital? (17:04): The advice you deserve. Evidence based.
Tue, January 19, 2021
Will Biden’s $1.9 Trillion Stimulus Plan Impact My Portfolio? | AWM Insights | Financial and Investment News
After yet another week packed with events including president-elect Biden rolling out a $1.9 trillion stimulus package, big tech bans, and Bitcoin hitting an all-time high and then losing almost a third of its value shortly thereafter – Erik, Brandon and Justin cut through the noise to help you navigate through the most recent financial and investment news. This week, they discuss the potential impact of the stimulus plan and a Democratic-controlled government on the markets, the dangers of holding individual companies or countries, and the benefits of taking a long-term, evidence-backed approach to building multi-generational wealth. Episode Highlights Unpacking the week’s events (00:01) What might the stimulus plan do to my investments? (1:25) “Multi-generational wealth requires discipline and long-term thinking to allow that compounding effect to take hold.” – Justin Dyer What would you have done in January 2020 if you had the magic crystal ball? (3:41) How long do you sit on the sidelines? (5:18) Warnings against trying to pick individual stocks or countries (6:23) Bitcoin and FOMO (7:23) Focus on what you can control (8:04) The three most important things to focus on in investing (9:20) The dangers of chasing returns (10:53) Which country was the top performer in 2020? (11:48) When to take measured risks (13:48) “Why do you invest? Are you investing to grow your wealth, or are you investing for entertainment?” – Brandon Averill Is a united government bad for the stock market? (14:56) “In a time when you feel like there is a lot of uncertainty, you know what is really risky and dangerous? Holding an individual company.” – Erik Averill
Tue, January 12, 2021
Is Your Portfolio Safe? Capitol Chaos, The Blue Wave & All Time Highs | AWM Insights | Financial and Investment News
Already in the first few weeks of 2021, we’ve seen: Bitcoin cross the $40k mark, President-elect Biden promise $2k stimulus checks, Elon Musk has become the richest man on the planet while one of the other richest men in the world – Jack Ma – has apparently gone missing, the Democrats win the Senate run off in Georgia, and rioters stormed the US Capitol. And is the midst of these events, the markets marched higher. In this week’s episode, AWM co-founders Erik Averill and Brandon Averill along with Chief Investment Officer Justin Dyer discuss last week’s events and financial news and how we could be seeing unpredictable and even tumultuous events in the news while the stock market continues to climb. Episode Highlights Is 2021 the Hunger Games? (00:09) Why stock markets continue to climb (1:12) Looking at historic traumatic events’ impacts (2:26) Why you can’t predict what markets will do (3:12) How to be a pro in volatile markets (4:13) Why 2021 predictions are useless (5:53) How investors should be thinking about individual equities and Bitcoin (7:10) Don’t rely on emotion (10:08) Elon Musk’s big bet with Tesla (11:12) “We know the winners of today are not the winners of tomorrow.” – Erik Averill (12:59) Determining your priorities (15:02) The best generator of returns in your lifetime (16:06)
Tue, January 05, 2021
Bitcoin, Georgia Senate, Stimulus Checks and 2021 Markets | AWM Insights | Financial and Investment News
As we close the books on one of the wildest years for the financial markets to date and head into 2021, how do we approach this new year in light of the volatility of last year’s markets? The S&P dropped 33.9% then ended the year up 18.3%, Small caps out-performed the S&P ending up 20%, and Bitcoin finished up 304% after seeing a -52.4% decline during the year. What lessons should we take from last year that should impact our investment decisions moving forward? In this week’s episode, AWM Capital co-founders Erik Averill, CFP®, CPWA®, Brandon Averill, CFP®, CPWA®, CIPM, are joined again by Chief Investment Officer Justin Dyer, CFA®, CFP® to discuss the biggest stories in the public markets and private market opportunities of the week. Episode Highlights 2020 market volatility replay (1:36) How should 2020 markets impact your investment decisions moving forward? (2:17) Potential impacts of the Georgia Senate race and stimulus checks (2:39) Setting your own timelines (6:18) The dangers of misaligned priorities (7:56) The rewards of small caps (8:51) The potential impacts of missing just a few days in the markets (10:28) Are the rewards of Bitcoin worth the risks? (10:52) One of the biggest mistakes investors can make (14:38) Looking out for your best interests (15:18) What are the ways to optimize your portfolio the maximize your returns that are evidence backed? (15:42) Right-sizing your risk exposure (16:09) How should 2020 markets impact future decisions? (16:51)
Tue, December 22, 2020
Should I Invest in Crypto? | AWM Insights | Financial and Investment News
As the dust of 2020 begins to settle and we round the corner to the end of the year, we can see just how wild it was. More than 40 weeks since COVID-19 has started, financial markets dropped by more than 30% and currently are up around 17-20%. However, there’s been one asset class that’s currently up over 200% - cryptocurrency. With more than $11.5 billion in Bitcoin purchased in the last 90 days and Wall Street firms jumping in - is now the time to invest? This week, Erik, Brandon and Justin discuss the pros and cons of cryptocurrency and the major questions you should consider before adding it to your portfolio. Episode Highlights Valuing Cryptocurrency – is this a currency replacement? (1:23) The assumptions on Cryptocurrency (2:24) $11.5 billion in Bitcoin purchased in the last 90 days (4:02) The change in institutional money entering into cryptocurrency now (5:13) Should we invest in speculation? (6:40) What circumstances should someone consider entering the cryptocurrency market? (7:41) Bitcoin corrections over the years (8:44) How do you set up a risk/reward spectrum for cryptocurrency? (9:38) Repeating conversations on Bitcoin (10:31) How the correlation of assets lower risk allocation (11:35) The danger of chasing returns – know why you’re buying (15:36)
Tue, December 15, 2020
How an Unprofitable Company Went Public with a $60 Billion Market Cap | AWM Insights | Financial and Investment News
Some of the biggest financial and investment news from the last week includes DoorDash – a food delivery service – reached a $60 billion market cap, even though the company isn’t currently profitable. Will it get to profitability? Why are IPOs like this and AirBnB ending up with such unexpectedly huge valuations? This week, Brandon Averill and Justin Dyer discuss these high valuations, break down the 3 categories of market returns, and outline why now could actually be one of the most dangerous times for a new investor just starting out. Episode Highlights How to be a good investor (1:09) Watch where your information is coming from (3:04) "If something is possible to know, you're better off not being very smart because smart people fool themselves into thinking they know, while average people are more likely to say, I don't know and up end up closer to reality." Psychology of Money by Morgan Housel Should you buy Tesla? AirBnb? (4:52) Skill vs Luck in investing (5:21) The 3 categories of market returns (5:38) Why this is a dangerous time for investors just starting out (8:07)
Tue, December 08, 2020
COVID Vaccines and Long-Term Investing | AWM Insights | Financial and Investment News
AWM Insights Presented by AWM Capital COVID Vaccines and Long-Term Investing For more insights, sign up for our newsletter at awminsights.com AWM Capital: IG | LinkedIn | Facebook | AWMCap.com Erik Averill: LinkedIn Brandon Averill: LinkedIn Justin Dyer: LinkedIn In this week’s episode, Erik Averill, Brandon Averill, and Justin Dyer discuss the biggest financial news of the past week and highlight the biggest takeaways you should know. We begin by highlighting more hopeful news from last week – this time out of the UK, as they become the first country to approve a COVID-19 vaccination with it rolling out this week and through the end of the month. With additional vaccines expected to begin distribution around the world, a recent report showing a drop in unemployment, and continued conversations on a potential additional stimulus package in the US, the big question is: how does this impact portfolios in the short and long term? Episode Highlights What the drop in unemployment claims misses in regards to the jobs report (1:17) Are economic stimulus packages good for the markets? (2:52) Deciding between two bad options? Control what you can control (4:22) “So I would summarize it really as remaining diversified, not trying to predict how the market's going to react to certain things like adding more stimulus over the long term. Because it truly is, like Brandon said, and we've said time and time again, a fool's errand.” “The core principles of having a successful investment experience is understanding the long-term nature of your investment strategy” (6:28) The importance of financial structure – understanding your priorities (7:52) Updating plans in real time as a long-term investor (9:50) The questions to ask about specific assert classes (10:30) “You have to invest in the markets as they are. You can’t invest in the markets as you want them to be.” (11:10) Liability matching (11:53) The most important question to be asking in the current economic climate (15:02)
Tue, December 01, 2020
Black Friday Market Impact |AWM Insights | Financial and Investment News
AWM Insights Presented by AWM Capital Black Friday Market Impact For more insights, sign up for our newsletter at awminsights.com AWM Capital: IG | LinkedIn | Facebook | AWMCap.com Erik Averill: LinkedIn Brandon Averill: LinkedIn Justin Dyer: LinkedIn Brandon Averill, Erik Averill, and Justin Dyer discuss the rising stock market even in a global pandemic, and long term investing, with a plan for whatever may come your way 0:34 Dow 30,000 milestone and other milestones in the stock market 3:55 How expectations should go into making decisions on the investment portfolio 6:16 You are not investing all of your money at the market high. It is a long process that takes time Justin Dyer:”You gotta think about the long term aspect that ties into the financial structure and focusing on the outcome.” 8:43 Brandon Averill: “There is a lot of different things that we’re focused on from a tax perspective right now...we certainly don’t have any more clarity on what's gonna happen.” Make sure asset location is in place. Make sure you are doing your Tax-Loss harvesting. Run the projections. 10:11 Justin Dyer: “It’s controlling what you can control.” Have a plan in place for any potential market environment that may come your way. For more insights, sign up for our newsletter at awminsights.com Subscribe to AWM Insights presented by AWM Capital on Apple, Spotify, Tune-In, Stitcher or at clnsmedia.com
Tue, November 24, 2020
Fool's Errand | AWM Insights | Financial & Investment News
AWM Insights Presented by AWM Capital A Fool’s Errand Why you should always be planning financially for something like COVID For more insights, sign up for our newsletter at awminsights.com AWM Capital: IG | LinkedIn | Facebook | AWMCap.com Erik Averill: LinkedIn Brandon Averill: LinkedIn Justin Dyer: LinkedIn The markets have begun to level out with conflicting forces from the government taking shape. Brandon Averill, Erik Averill and Justin Dyer get you caught up on everything happening within the markets and why you should never overreact. Plus, why you should always be planning financially for something like a global pandemic. 00:30 A transition from positive markets to some mixed reviews because of the disagreement between the Fed and the Treasury. 1:36 The impact we’re seeing in the markets with the announcement of COVID vaccines being released. Brandon Averill: “We see some corrections like the cloud computing index and the cloud companies get absolutely crushed on news of a vaccine, but then the timeline for the vaccine comes out and everything corrects back the other way.” 2:20 Justin Dyer: “Trying to predict which way markets are gonna go is a fool's errand.” 3:30 Amazon’s latest news also has long term ramifications for the commercial real estate business. 4:05 Tesla seems like the no-brain winner as they are finally joining the S&P 500. Brandon Averill: “They’re going to be the largest company to join the S&P 500 in history.” 6:45 The importance of global diversification in investments. 10:29 The fundamentals of professional investors: “What are the drivers of returns, what are the sources of returns and how do we allocate our plans to help us achieve outcomes we want based off of those investments.” 12:10 Financial structure trumps the portfolio. Even though it’s an industry leveraged for competition within the portfolio, it should be about the outcomes you are trying to achieve as an individual. For more insights, sign up for our newsletter at awminsights.com Subscribe to AWM Insights presented by AWM Capital on Apple, Spotify, Tune-In, Stitcher or at clnsmedia.com
Tue, November 17, 2020
Luck Masquerading as Skill | AWM Insights | Financial & Investment News
AWM Insights Presented by AWM Capital Luck Masquerading as Skill And the art of controlling what you can control when it comes to investments in your portfolio For more insights, sign up for our newsletter at awminsights.com AWM Capital: IG | LinkedIn | Facebook | AWMCap.com Erik Averill: LinkedIn Brandon Averill: LinkedIn Justin Dyer: LinkedIn With everything going on in the world right now, the markets somehow keep going up. Brandon Averill, Erik Averill and Justin Dyer talk about the relationship of risk and return, how fast a bit of information could change the markets, and to make sure that you have clarity around your plan. 1:11 Even in the midst of surge in COVID cases and potential lawsuits surrounding the election, the markets are still reacting positively. Dyer: “Markets are really looking out six, nine, probably even twelve months and beyond that in some cases. That’s a good thing, that’s how investors should be operating, we don’t invest in the short term.” 3:44 Risk and return are related, volatility comes more consistent, markets are relatively efficient. It's about outcomes not returns. 5:11 An average Joe approach vs the technological approach in terms of tax harvesting and not just doing it at the end of the year but doing it throughout the year. 8:13 The question on investment in certain stocks it’s important to know when to buy and of course when to sell. Erik Averill: "In a moment's notice of a piece of information of potential news, markets and individual companies are being reacted to quickly." 11:52 Make sure that you have clarity around your plan. How do you make sure that you have the highest after tax return? For more insights, sign up for our newsletter at awminsights.com Subscribe to AWM Insights presented by AWM Capital on Apple, Spotify, Tune-In, Stitcher or at clnsmedia.com
Tue, November 10, 2020
Election Impacts on Portfolio | AWM Insights | Financial & Investment News
AWM Insights Presented by AWM Capital Election Impacts on PortfolioHow to not overreact to the overabundance of noise For more insights, sign up for our newsletter at awminsights.com AWM Capital: IG | LinkedIn | Facebook | AWMCap.com Erik Averill: LinkedIn Brandon Averill: LinkedIn Justin Dyer: LinkedIn With the election behind us what are the immediate moves we should make to ensure portfolio viability in 2021? Erik and Brandon Averill walk through what to know in the midst of the cacophony of noise around the election and how to build to your best possible portfolio outcome. 1:30 How are markets reacting to the Presidential election? 3:17 Why are markets reacting positively if Joe Biden looks to be the President-elect? There was a fear that if Joe Biden was elected, taxes would go through the roof and the economy would generally be negatively impacted. 6:46 What are the key tenets during a noisy period that we should stick to when it comes to long term investment plans? 9:35 Brandon Averill: “Financial structure beats the portfolio every time.” For more insights, sign up for our newsletter at awminsights.com Subscribe to AWM Insights presented by AWM Capital on Apple, Spotify, Tune-In, Stitcher or at clnsmedia.com
Tue, November 03, 2020
A Tax Boost for Your Portfolio | AWM Insights | Financial and Investment News
AWM Insights Presented by AWM Capital A Tax Boost for your PortfolioGuest: Alan Trice , Head of Advisory Services, Gurtin Municipal Bond Management. Making money off your investment portfolio is only a part of the puzzle, what are your portfolio's tax implications? It's paramount to ensure you fold a tax plan along with investment strategies into your portfolio. On this front, municipal bonds is a fixed investment that will also help your tax strategy. On this week's episode you'll learn the ins and outs of the muni bond industry For more insights, sign up for our newsletter at awminsights.com AWM Capital: IG | LinkedIn | Facebook | AWMCap.com Erik Averill: LinkedIn Brandon Averill: LinkedIn Justin Dyer: LinkedIn 00:18 “It doesn’t matter how much you make it’s about how much you keep.” What matters most to your portfolio is not your gross, it’s your net. 1:07 How important is tax planning when it comes to your portfolio? Here’s an example of what Californians are paying at tax time. 2:45 Fixed income in general fits into a portfolio for two purposes: 1- To provide steady and consistent income 2- Balance in a portfolio: it’s there for safety and diversification 3:36 Municipal Bonds are extremely tax efficient: almost all munis are completely exempt from the federal income tax rate. 5:33 What’s unique about municipal bonds compared to equities and other fixed income markets? 6:26 80% of the municipal bond market is in the retail space. 7:58 Munis are really part of a highly diverse market, only around 30% of the municipal market is general obligation debt. 10:15 Average Joe’s vs. the Pros: What’s the advice in getting in the municipal bond market “This is a pretty misunderstood market. Generally would not recommend individual investors invested directly on their own in this market.” Register for the free webinar on how to optimize your portfolio in the most tax efficient way: AWMWebinar.com For more insights, sign up for our newsletter at awminsights.com Subscribe to AWM Insights presented by AWM Capital on Apple, Spotify, Tune-In, Stitcher or at clnsmedia.com
Tue, October 27, 2020
Focusing on the Process | AWM Insights | Financial and Investment News
AWM Insights Presented by AWM Capital Focusing on the Process For more insights, sign up for our newsletter at awminsights.com AWM Capital: IG | LinkedIn | Facebook | AWMCap.com Erik Averill: LinkedIn Brandon Averill: LinkedIn Justin Dyer: LinkedIn Another great reminder that not all private market opportunities are without substantial risk. Plus, the electric car boom is approaching and how to make sense of all of the noise surrounding the election and the impact the outcome will have on your taxable assets. 00:55 Why Brandon might have to burn his “Bummer” t-shirt, as the Hummer is going electric! 1:34 Quibi seemed to be on a great financial trajectory and had all kinds of talent, they decided to shut down. Brandon talks about the market implications for the closing of Quibi. 2:56 We’re also seeing new economic data that’s just being released as we ended Q3. The important takeaways from the data including great news for the economic rebound. 5:30 In Average Joes vs. Pros: How should you react to the differing tax policies based on the Presidential election? 6:10 History tells us you can’t correlate performance of financial markets with the party holding presidency. 6:52 How to avoid the knee-jerk short term reactions that will hurt your portfolio. Register for the free webinar on how to optimize your portfolio in the most tax efficient way: AWMWebinar.com For more insights, sign up for our newsletter at awminsights.com Subscribe to AWM Insights presented by AWM Capital on Apple, Spotify, Tune-In, Stitcher or at clnsmedia.com
Mon, October 19, 2020
An Absolute Must Have in Your Portfolio | Dave Plecha | AWM Insights Financial & Investment News
An Absolute Must Have in Your Portfolio AWM Insights Presented by AWM Capital Guest: Dave Plecha , Global Head of Fixed Income at Dimensional Fund Advisors For more insights, sign up for our newsletter at awminsights.com AWM Capital: IG | LinkedIn | Facebook | AWMCap.com Erik Averill: LinkedIn Brandon Averill: LinkedIn Justin Dyer: LinkedIn The importance of folding Municipal Bonds into your portfolio has been a common discussion on AWM Insights, this week Dave Plecha, the Global Head of Fixed Income at Dimensional Fund Advisors, joins the show to provide expert analysis on Municipal Bonds to further the discussion. There’s a tremendous opportunity based on the cash flow available and tax free nature of Municipal Bonds. 1:27 - 3:20 Where do Municipal Bonds fit for Dave Plecha in a broadly diversified portfolio? Stocks are the area to grow your portfolio, however the second component of a portfolio should be in minimizing risk. Municipal Bonds satisfy both in terms of growth, but also minimizes risk and is extremely helpful in terms of taxes. 3:25 - 6:10 Why are not all Municipal Bonds created equal? There are two types of Municipal Bonds: Term and Credit 6:20 What are the differences between Municipal Bonds between states and what are the taxable implications on income made from Municipal Bonds. Key takeaway: There’s a tremendous opportunity based on the cash flow available off of Municipal Bonds. Register for the free webinar on how to optimize your portfolio in the most tax efficient way: AWMWebinar.com For more insights, sign up for our newsletter at awminsights.com Subscribe to AWM Insights presented by AWM Capital on Apple, Spotify, Tune-In, Stitcher or at clnsmedia.com
Tue, October 13, 2020
Avoiding the Investment Noise | AWM Insights | Financial & Investment News
Avoiding the Investment Noise AWM Insights Presented by AWM Capital For more insights, sign up for our newsletter at awminsights.com AWM Capital: IG | LinkedIn | Facebook | AWMCap.com Erik Averill: LinkedIn Brandon Averill: LinkedIn Justin Dyer: LinkedIn Avoid the noise during earning season! The financial media only draws on quarter over quarter numbers, which is not a great indicator of long term gains or success. Plus, beyond making the right investments, understanding the tax component of your investments is most important. :15 - :44 The latest news on the Stimulus Package and the impact and volatility of the market because of the unknowns surrounding the stimulus package. :54 - 2:12 The House Judiciary committee released a 450-page report on the 16th month investigation into the tech industry and the recommendations made by the government on the state of the competition in the digital economy. Plus the energy sector and Honda pulling out of Formula 1 to focus on the electric car market. 2:22 - 3:31 There will be no shortage of news that the financial media will be covering during earning season, so it's important to avoid the noise because it's far too short term to focus on. 3:40 - 4:40 Average Joe’s vs. Pros: Peloton is a great example: "This is typically what we see in earning season, is trying to anticipate the future, 'What is popular in our network right now, should I invest in that.'" Would the Pro take advantage of this earning season because the volatility might be the perfect time? 4:42 Justin Dyer, AWM Capital, Chief Investment Officer: "The quarter over quarter stuff is just noise and there are all these anecdotal statements over earning season." 6:20 Be tax aware: "After tax returns are what truly matters, that's what people are going to spend at the end of the day, or give away." 8:21 Key takeaway: Regardless of whoever wins the election: Trump or Biden there are going to be critical changes you will need to make to your portfolio based on taxs. Register for the free webinar on how to optimize your portfolio in the most tax efficient way: AWMWebinar.com For more insights, sign up for our newsletter at awminsights.com Subscribe to AWM Insights presented by AW
Tue, October 06, 2020
Hims for Us? | AWM Insights | Financial & Investment News
Hims for Us? AWM Insights Presented by AWM Capital For more insights, sign up for our newsletter at awminsights.com AWM Capital: IG | LinkedIn | Facebook | AWMCap.com Erik Averill: LinkedIn Brandon Averill: LinkedIn Justin Dyer: LinkedIn How has President Donald Trump contracting COVID-19 impacted the markets? Plus, the most important investment strategy you'll need is a tax strategy. :45 - 1:25 The latest in investment news: Two software companies: Palantir and Asana both went public. In addition, Hims is doing a reverse merger into a SPAC that's backed by Oak Tree. 1:25 - 2:26 Why the markets are a bit shaky and unpredictable at the moment, beyond just President Donald Trump testing positive for COVID-19. Plus what is the latest on the pandemic economic recovery? 2:40 - 4:03 Average Joe’s vs. Pros: Should I be looking at buying Municipal bonds if I'm looking to limit risk? 4:08 Key takeaway: Capturing high expected returns? It can get exciting, but ultimately it's all about your after tax returns in the public markets. So make sure you have a tax strategy as much as you have an investment strategy. For more insights, sign up for our newsletter at awminsights.com Subscribe to AWM Insights presented by AWM Capital on Apple, Spotify, Tune-In, Stitcher or at clnsmedia.com
Tue, September 29, 2020
Investing in Tik Tok US | AWM Insights | Erik Averill, Brandon Averill & Justin Dyer
Investing in Tik Tok US? AWM Insights Presented by AWM Capital For more insights, sign up for our newsletter at awminsights.com AWM Capital: IG | LinkedIn | Facebook | AWMCap.com Erik Averill: LinkedIn Brandon Averill: LinkedIn Justin Dyer: LinkedIn Investment in Tik Tok US is starting to make headlines; Erik, Brandon and Justin give you The Average Joes vs. Pros on Tik Tok impact in public + private markets. :40 - 1:16 Apple’s app store charges are back in the news. Spotify, Fortnight’s Epic Games and Tinder have all partnered with the non-profit coalition called the Coalition of App Fairness to bring legal action against Apple to see if they can bring down their charges. 1:34 - 2:50 The latest legal standing for Tik Tok in the United States. President Trump being asked to defend his status on Tik Tok to a US District Court. 3:02 - 5:30 Average Joe’s vs. Pros: What does the Tik Tok news mean for investors? Should you go buy Oracle and Walmart stock with their investment to Tik Tok US? 5:31 - 8:28 What does the Tik Tok news mean for the private markets? 8:42 Recapping the news on Tik Tok and the impact it will have on the public and private markets. Judge says U.S. must defend or delay TikTok app store ban by Friday Subscribe to AWM Insights presented by AWM Capital on Apple, Spotify, Tune-In, Stitcher or at clnsmedia.com
Tue, September 22, 2020
A Period of Rising Inflation | AWM Insights | Financial & Investment News
A Period of Rising Inflation AWM Insights Presented by AWM Capital For more insights, sign up for our newsletter at awminsights.com AWM Capital: IG | LinkedIn | Facebook | AWMCap.com Erik Averill: LinkedIn Brandon Averill: LinkedIn Justin Dyer: LinkedIn Last week, we discussed the Federal Reserve’s recent meetings where they signaled a willingness to allow a rise in inflation over the next 10-20 years. We received a lot of good feedback and follow up questions, and as a result are following up in a part two this week where we can address a few of the implications for investors. Our managing partner, Brandon Averill, is joined again by our Chief Investment Officer, Justin Dyer to discuss: • With the Fed signaling that they would likely allow inflation to rise over the next 10-20 years, are we as investors happy about that? • Would a higher than normal rise in inflation impact our investment strategies for our clients? Would it dictate a change in our portfolios? • Could inflation change investment performance over time? Are there ways to protect or adjust for that? • Are there any adjustments that are needed to allow for inflation? • What are Treasury Inflation-Protected Securities (TIPS)? Subscribe to AWM Insights presented by AWM Capital on Apple, Spotify, Tune-In, Stitcher or at clnsmedia.com
Tue, September 15, 2020
Important Inflation News for Investors | AWM Insights | Financial & Investment News
Important Inflation News for Investors AWM Insights Presented by AWM Capital For more insights, sign up for our newsletter at awminsights.com AWM Capital: IG | LinkedIn | Facebook | AWMCap.com Erik Averill: LinkedIn Brandon Averill: LinkedIn Justin Dyer: LinkedIn You might be familiar with the terms “inflation” and “deflation,” but do you know how they positively and negatively impact us as investors? About 2 weeks ago, the Federal Reserve held a virtual conference where they said they would be willing to let inflation run higher over a certain period of time to make up for lower inflation we’ve experienced in the recent past. So, over the next 10 years they could target a higher inflation rate than has previously been seen. To understand how this might impact us as investors, Brandon Averill, managing partner of AWM Capital, is joined again by Justin Dyer, AWM’s Chief Investment Officer, to discuss inflation and the implications it has on investments. Key Topics: What exactly is inflation? What does a quart of milk have to do with how inflation is measured? Why is inflation important to investors? What happens with slow inflation? What is typically considered the ideal inflation rate for the U.S. economy? What is the Consumer Price Index (CPI) and what does it impact? What is the Personal Consumption Expenditure (PCE) and what does it impact? Why has inflation been in the news recently? Resources: Investopedia has some great resources on Price Level , Basket of Goods , and Purchasing Power Also, be sure to read Dimensional Fund Advisors great article on Inflation’s Impact on Investors For more insights, sign up for our newsletter at awminsights.com Subscribe to AWM Insights presented by AWM Capital on Apple, Spotify, Tune-In, Stitcher or at clnsmedia.com
Tue, September 08, 2020
Trump or Biden For Investment Returns | AWM Insights | Financial & Investment News
Trump or Biden For Investment Returns? AWM Insights Presented by AWM Capital For more insights, sign up for our newsletter at awminsights.com AWM Capital: IG | LinkedIn | Facebook | AWMCap.com Erik Averill: LinkedIn Brandon Averill: LinkedIn Justin Dyer: LinkedIn Are certain presidential candidates better for the stock market? If so, is there a “correct” party to vote for to improve the chances of stronger returns? We often hear political pundits offering advice or predictions around presidential election season, and suggest that the answer to both of these questions is unequivocally “yes.” There are certainly many ways political candidates impact our country, and because of that, it is extremely important we exercise our right to vote. However, as we wade through to the real issues – should a candidate’s impact on the stock market be one of them? In this week’s episode of AWM Insights, Brandon & Erik, armed with more than 80 years of data, break down this question – and the answer might surprise you. Discussed questions and topics include: How do presidential elections impact investment returns? Which 2 presidents have seen the best S&P returns while in office? Which presidents experienced negative S&P returns during their terms? Is it true my political party is better for the stock market? What drives the stock market? How is the stock market different than the economy? How might the two candidates’ tax proposals impact my finances? Are there any ways to curb those impacts? Do tax rates matter to stock markets? RESOURCES To see the data discussed during this episode, CLICK HERE For more insights, sign up for our newsletter at awminsights.com Subscribe to AWM Insights presented by AWM Capital on Apple, Spotify, Tune-In, Stitcher or at clnsmedia.com
Tue, September 01, 2020
Finding The Next IPO Unicorn? | Brandon Averill, Justin Dyer | AWM Insights #26
With an estimated $44 billion worth of startups like Snowflake , Unity Software , JFrog , Sumo Logic and Amwell going from private to public right now, is it time to try and strike it rich by investing in the next unicorn company during its initial public investment (IPO) phase? If you only got your investment advice from the mainstream media, you might assume that this is the best way to create massive wealth, but as you might have guessed, it’s not quite that simple. The private to public or - IPO - step in the lifecycle of a business is incredibly important. And when companies go public, they often garner massive media coverage. However, is this the best time to invest in a company across the board? The data might surprise you. In this week’s episode of AWM Insights , Brandon Averill , Managing Partner at AWM Capital, is joined by Justin Dyer , our Chief Investment Officer, to discuss how and when companies typically create the most value. Topics and questions covered include: Do IPOs favor the investor? Are they a good investment on their own? Why do companies decide to go public? ·What exactly is a unicorn company, and what stage in a company’s lifecycle is generally considered to be the ideal time to invest? ·When does most of the value creation for a company occur? What is a direct listing and how is it different from a traditional IPO? Are direct listings similar to SPACs? (For more on SPACs see our previous episode HERE )
Tue, August 25, 2020
Do Valuations Matter Anymore? | Erik Averill, Brandon Averill | AWM Insights #25
Last Tuesday, the S&P 500 hit a record high after a sudden and unprecedented decline in the earlier months of the year. Much of the growth has been attributed to 5 big tech stocks, which we covered on a recent episode . As we’ve seen these 5 big tech stocks diverge, it’s made many investors ask if valuations even matter anymore? While these companies are enjoying their highest valuations ever, we see examples like Apple where their stock price has roughly tripled since early 2019, but so too has its Price to Earnings (PE) ratio. In this week’s episode, Erik and Brandon discuss this recent rise and more, including: What’s behind the recent all-time high of the S&P 500 What is a Price to Earnings (PE) ratio and why does it matter? What are the implications of Apple’s stock price and PE ratio rise? Do valuations even matter anymore? Can valuations be used as a tool for market timing? What is recency bias? The importance of understanding what kind of investor you are and your goals for wealth creation
Tue, August 18, 2020
Is Biden Or Trump Better For Your Investment Returns? | Erik Averill, Brandon Averill | AWM Insights #24
Are certain presidential candidates better for the stock market? If so, is there a “correct” party to vote for to improve the chances of stronger returns? We often hear political pundits offering advice or predictions around presidential election season, and suggest that the answer to both of these questions is unequivocally “yes.” There are certainly many ways political candidates impact our country, and because of that, it is extremely important we exercise our right to vote. However, as we wade through to the real issues – should a candidate’s impact on the stock market be one of them? In this week’s episode of AWM Insights, Brandon & Erik, armed with more than 80 years of data, break down this question – and the answer might surprise you. Discussed questions and topics include: How do presidential elections impact investment returns? Which 2 presidents have seen the best S&P returns while in office? Which presidents experienced negative S&P returns during their terms? Is it true my political party is better for the stock market? What drives the stock market? How is the stock market different than the economy? How might the two candidates’ tax proposals impact my finances? Are there any ways to curb those impacts? Do tax rates matter to stock markets?
Tue, August 11, 2020
Should You Invest In A SPAC? | Erik Averill, Brandon Averill | AWM Insights #23
Recently in the headlines, we’ve seen a lot of attention around SPACs (special purpose acquisition company) due to some big names in the investing world doubling down on them this year. So far in 2020, 60 of the 95 IPOs in the US have come from these SPACs and they’ve raised $24 billion further cementing them as the preferred method for going public this year. So what exactly are SPACs and should you be investing in them? These special purpose acquisition companies are essentially shell companies that raise money from public markets to buy a private company. They have some very interesting characteristics to them that provide some advantages such as lower cost and some flexibility, and disadvantages like the fact that you’re essentially putting all your trust in the management team of the SPAC. In this week’s episode, Brandon and Erik discuss SPACs and cover questions and topics like: What is a SPAC? How do they work? What are some of their unique characteristics? What are their advantages and disadvantages? Are they considered a good investment? What is behind their recent surge in popularity? What should you consider before investing in a SPAC? Should you expect similar returns with SPACs that you’d see in the private markets? Ultimately, we would say ignorance is not bliss in investing, but a danger. Like any other single entity investing, we recommend our clients do their research and discuss with their financial professional about how it might fit in their investment portfolio.
Tue, August 04, 2020
Tech Stocks Are The Highest Performers – Should You Get In? | Erik Averill, Brandon Averill | AWM Insights #22
Most economic news continues to point to things not looking great – including a 2nd quarter contraction of US GDP by an annual rate of 32.9%. However, the stock market still seems to have some positive moves. What’s behind the majority of the returns in the public stock market? Tech companies like Apple, Microsoft, and Google. In fact, the disparity in the S&P 500 is from the 5 largest companies, which have accounted for all the growth, but the remaining 495 have been producing negative returns. Does that mean now is the time to invest in these companies? In this episode, Brandon & Erik discuss this and more including: What is contributing to the majority of returns in the US stock market? If the 5 biggest companies are driving all growth in the S&P 500, why even consider investing in the other 495 companies – let alone international options? What are the risks of investing in individual equities if I’m trying to grow wealth in a long-term, risk-adjusted way? Is there ever a situation where you might recommend taking concentrated risk? Where would an investor have the best change of growing wealth through concentrated investments?
Tue, July 28, 2020
Where Does Gold Fit In Your Portfolio? | Erik Averill, Brandon Averill | AWM Insights #21
Gold is a topic that tends to pop up anytime there’s uncertainty in the market or conversations of where the economy is headed. We’ve seen gold hit all-time highs over the past week joined with increased nervousness of the pending stimulus package in congress and upcoming elections. This has resulted in more voices who recommend investing in gold as a safe alternative to a volatile market. In this episode Brandon and Erik discuss some of the arguments made for investing in gold and potential alternatives for long term investors. Topics discussed include: How should we think about gold? Where/how does gold fit in an investment plan? How to think about investments Why we don’t include gold in our investment portfolios How has gold performed historically as an asset class? Should I purchase physical gold in case things go bad? Is gold a safe hedge against a volatile market? What’s a better way to provide some protection if you’re worried about the economy over the short term?
Tue, July 21, 2020
Is A Market Crash Inevitable? | Erik Averill, Brandon Averill | AWM Insights #20
With a looming election this fall, an ongoing global pandemic, and companies declaring bankruptcy left and right; there is currently no shortage of speculation framed as certain advice everywhere you look. Mainstream media pundits and social media influencers alike are quick to share the latest stock tip, advice on market timing, speculations on bankrupting companies, or even urge you to exit the markets entirely and wait until they calm back down. While it is entirely likely there will be market impacts from the upcoming presidential debates and election, COVID-19 vaccine trials, and whether or not the government adopts an additional stimulus plan – the full effect of those impacts and even how they play together are entirely speculative. The truth remains that no one has a crystal ball. So what should you do in the midst of all the noise? Don’t abandon your plan. In this week’s episode, Brandon and Erik address some of these speculations and cover other topics and questions like: Was Peter Schiff correct when he recently said that a market crash is inevitable? How to avoid FOMO (fear of missing out) in the current market climate The greatest dangers investors face The difference between being an investor and a speculator Understanding how to participate well in public markets Why the mainstream media is not the best source of financial advice What advice can you give on having confidence in my investment plan? How can I wade through all of the speculation that I’m receiving the economy, stock market, and investing?
Tue, July 14, 2020
Why Taxes Matter To Your Investments | Erik Averill, Brandon Averill | AWM Insights #19
One of the most important distinctions we like to make with our clients is that our primary job is not only investing. We re-center our clients’ definition of success by asking them if simply investing is the goal or if it’s actually to increase their net-worth after taxes and expenses? The answer is always: net worth. Investing is really just a means to an end. Our primary job, and the ultimate value we deliver, is in increasing our clients’ entire net worth. Unfortunately, the act of investing is typically the sole focus of retail financial advice. The average broker and financial advisor will spin their wheels trying to sell their investment strategies in the public markets, yet this is rarely the main driver of wealth. Most investors miss out on other financial moves to grow and keep wealth including tax planning strategies that can produce double digit returns on their net worth. This week, Erik and Brandon discuss some of these strategies and why they should be important to you covering topics like: Why should I consider taxes in my investment conversations? Why aren’t more financial advisors talking about this integration of investing and tax planning? What are conversations I should have with my financial advisor to keep the returns from taxes that I deserve? What are some other ways to manage, defer, and reduce taxes when it comes to your investment plan? Are there ways a 1099 employee can reduce taxes? Why those in the highest tax bracket might want to consider asset location and tax-loss harvesting in their tax strategy plan
Tue, July 07, 2020
What You Should Know About Earnings Season | Erik Averill, Brandon Averill | AWM Insights #18
As you see in the major media and financial publications, earnings season is coming soon, but what does that mean for the typical investor? Articles and TV segments abound with the results and guidance of some of the best analysts in the business on their predictions of how some of the top companies are doing, but does that mean that you should be acting on those claims? Put simply, “earnings season” is the time in which most of the major publicly traded companies release their quarterly earnings reports. As a result of these reports, more updated information is then available to the public followed by market adjustments. What makes this upcoming earnings season of particular interest for many is the fact that it’s following the best quarter since 1987. In this week’s episode, Brandon and Erik discuss earnings season and cover topics and questions like: What exactly is earnings season and why do people get excited about it? How earnings season can highlight the difference between the stock market and the economy (for more on this, see episode 11: Stock Market vs Economy) How and why earnings season causes market adjustments Why some of the best analysts in the world still can’t predict future outcomes based on earnings season information What should I know about earnings season? Should I take any steps to prepare or react to it? What’s the best way to secure long-term, positive financial results?
Tue, June 30, 2020
Gambling Or Investing – Which Game Are You Playing? | Erik Averill, Brandon Averill | AWM Insights #17
Over the last couple weeks, we've seen the return with a vengeance of volatility in the markets with some of the biggest highs and lows in history all within a short time span. With these swings, we're starting to see non-investor voices give investing advice that really boils down to gambling. The message from these media personalities is loud and clear: now is the time for people to become active investors. Is there room for this type of investing? The answer revolves around your current situation and your long-term goals. In this episode, Erik & Brandon give some helpful thoughts on how to view this concept and address topics and questions including: Why Shaq’s free throw record relates to investing The myth of entertainment-based trading Should we pay attention to what the media is telling us? How much credence should we give to news sites advice on the investment decisions we should be making? Day trading vs long-term investing How the active investing we're seeing in mainstream conversations is similar to sports gambling How do we most effectively grow our wealth over the long-term? How do you stay disciplined over the long term and not fall for the get rich quick gimmicks?
Tue, June 23, 2020
Should COVID-19 Change Our Investment Decisions? | Erik Averill, Brandon Averill | AWM Insights #16
With a spike in Coronavirus cases around the country, we continue to see multiple industries getting shaken including airlines, cruise ships, and travel destinations. Alternatively, we see the top tech companies (Google, Facebook, Microsoft, Apple, and Amazon) combined currently represent more than 20% of the S&P 500, which makes sense with more people than ever relying on technology to work and stay connected. As we continue to allocate investments, many are wondering if we should try to make concentrated bets on how the Coronavirus might continue to impact different parts of the economy. However, the main thing to keep in mind is that no one has a crystal ball - no one can see the future. So, typically the best way to prepare for times like these is diversification of your allocations. We've seen throughout history similar trends with different industries rising and falling, and investors who aren't diversified can unknowingly expose themselves to more risk than they intend. In this episode, Erik & Brandon discuss this idea and address topics like: What is the home bias? How diversification can protect against unintended risk and help to capture opportunity What can we learn from history and data in terms of portfolio diversification? What is success? How do we most effectively grow our wealth over the long-term?
Tue, June 16, 2020
Should I Try To Day Trade? | Erik Averill, Brandon Averill | AWM Insights #15
The market has continued to bring surprises. In the last couple months we've seen one of the quickest recessions to one of the quickest recoveries then suddenly last week we saw a -6% down day in the market. In tandem with this market volatility, we've also seen many big name companies declare bankruptcy followed by their stock prices skyrocketing. In their wake have been more voices who have adopted a day trading approach claiming now is the time to buy these companies pretty much across the board. This can cause us as investors to question what is going on in the short term, and ask if we should lean into this day trading approach. However, we also know that the disciplined approach is going to continue to be to cut out the noise, control what we can control, and stick to the plan for the long term. This week, Brandon & Erik discuss these news items and address the following questions and topics: Is now the time to buy a specific company's stock that I've heard about in the news? How concerned should I be about short-term market fluctuations? Is there ever a time to consider more of a day trader approach? If I have a pool of money that I'm okay to take more risk with, what are some of my options to consider? What options are available besides stock picking on public markets? What do you guys see is the best approach for long-term wealth creation and success?
Tue, June 09, 2020
The Upside Of Ownership | Erik Averill, Brandon Averill | AWM Insights #14
On last week's episode, we started our conversation on the idea of ownership by defining risk and discussing some of the rewards that come along with the different types of risk you can take. Ultimately, this can be described as the upside of ownership. This week, we'll continue with part two where we'll explore the fundamentals of ownership and cover topics and questions like: What exactly are the fundamentals of ownership? How do we define ownership when it comes to investing? What does it mean and what are the implications to owning stock? Why could equity be preferred over being a bond holder? Is all equity created equal? Is now the time to invest in a specific company?
Tue, June 02, 2020
How To Get The Highest Returns | Erik Averill, Brandon Averill | AWM Insights #13
What should we be doing with our money right now? Over the last few weeks, we've covered topics that we've been asked about from our clients on real estate, private markets, and more. We've also been asked if now is a good time to consider cryptocurrency. However, these might be the wrong questions, at least in starting the conversation. Instead, we should start with our overall money goals - what do you want your money to do for you? The answer to this question helps us to determine an appropriate level of risk to work toward achieving the returns that would help us accomplish our money goals. In this episode, Erik and Brandon discuss this idea and cover topics and questions like: How do you actually define investment risk? What is the framework for determining how much risk you can handle? Why saying you want all the return but none of the risk does not work. Understanding the relationship between risk and return. Cutting out unnecessary risk. The impact of diversification on risk.
Tue, May 26, 2020
Characteristics Of A Long-Term Investor | Erik Averill, Brandon Averill | AWM Insights #12
We've said that trying to predict markets is a dangerous game to play, so now that the country begins to open up - how do we answer the frequently asked question of what the market will do over the coming months? We typically start our response by revisiting why our clients are invested in the public markets in the first place. The answer should not be to try to make a significant return within the short-term - 12 or 18 months - but is most often the goal of generating wealth over the long-term. As humans, we tend to shy away from uncertainty and instead have a tendency to lean toward people who confidently declare certainty about what will happen in the future. That's why it can be easy to find "experts" who claim they've figured it out or try to predict what will happen in the immediate future. However, the data repeatedly shows that this is a fool's game. The reality is that no one has a crystal ball on what the market will do through the rest of the year. In this episode, Brandon and Erik discuss this idea and cover: The characteristics of a long-term investor vs a day-to-day market timer Some of the core principles to help make sure to capture the long-term market potential returns The importance of a globally diversified portfolio What the backbone of most plans should typically be based around
Tue, May 19, 2020
Stock Market Vs Economy | Erik Averill, Brandon Averill | AWM Insights #11
In recent weeks, we've seen a lot about how the stock market seems to be rallying, but the economy is doing poorly. As a result, we've received a lot of questions about how there can be a disconnect between those two entities. However, when the stock market is mentioned, many refer to the S&P 500, which only makes up only 44% of the U.S. economy. Whereas, when we discuss the actual economy, it encompasses all goods and services being produced. Likewise, stock market data is a prediction of how those companies might do in the future, whereas economic data is data about the past. How can you navigate all this information? And how does it connect together? In this week's episode, Brandon and Erik address these questions and cover: A definition of both the stock market and the economy The information and data available about each one What - if any - information can be utilized between one to inform decisions about the other The distinctions between the two including how one can be doing well while the other suffers
Tue, May 12, 2020
Private Market Investing Like A Pro | Erik Averill, Brandon Averill | AWM Insights #10
Much of the initial emotion toward fluctuating markets has softened and our clients have begun asking great questions like "Should I invest in oil? Or real estate?" which we have been addressing the past few weeks in our Insights podcasts. This week, we wanted to focus our attention on some of the ways we do like to think about taking concentrated risks - specifically in the private markets. We've continually said that we believe in the public markets. However, for some of our clients who have solved for safety through a diverse investment in the public market, we begin recommending looking into private markets, which often may provide over sized returns, but carry much more risk. In this episode, Brandon and Erik dive into this idea and cover topics like: Are there ways to take advantage of the fluctuating markets we've seen in recent months? When would be a good time to start a conversation with my financial professional about investing in the private markets? Why do some get over sized returns in private markets? How important is it to invest with someone who has had experience in these up and down markets? What resources are there where I can learn more on venture capital investing?
Tue, May 05, 2020
Should I Stay In Or Jump Out Of The Markets During Uncertain Times? | Erik Averill, Brandon Averill | AWM Insights #9
While many states in the U.S. are beginning to relax social distancing practices, the future is still uncertain with some still wondering if there will continue to be drastic market fluctuations. This has sparked many to wonder whether they should stay in the markets at all in the face of potentially more downturns? Why not just return to the markets once they begin to normalize again? While market fluctuations can certainly be unsettling, trying to jump out of the markets before a potential downturn and then get back in when the markets have normalized has many issues - namely that there is no guarantee that the speculations will end up as predicted. Taking the most recent example, in March we experienced the fastest bear market in history with stocks falling more than 30%. Later that same month, we experienced the largest three-day surge in the Dow Jones Industrial Average since 1931 followed by the best monthly performance in April for the Dow Jones and S&P 500 since 1987. Had you jumped out of the market at the outset of the downturn, you may have missed out on the potential market recovery that occurred directly after. In this week's episode, Brandon & Erik discuss these questions and give some insight on a better approach that focuses more on long-term wealth creation rather than short-term gains.
Tue, April 28, 2020
Should I Invest In Real Estate? | Erik Averill, Brandon Averill | AWM Insights #8
Real estate is a topic that a lot of people have interest in - often from being home owners themselves. There is wide exposure to the idea of investing through real estate in tv shows, books, webinars and more. One question we've been frequently asked by our clients is if this current time is providing a unique opportunity to invest in real estate in the midst of market uncertainty. The ultimate answer is it mostly depends on your situation - we are massive supporters of real estate, but only within the right context and the right plan. More often than not, the devil is in the details. Our clients receive numerous real estate pitches, but you have to understand all the details of the deal to accurately determine if it makes sense for you without an emotional attachment to the vision of the project. In this episode, Brandon and Erik look at what it takes to approach investing in real estate like a pro, and address some of the most frequent topics and questions we receive including: What are the best ways to approach real estate without an emotional attachment to investment decisions? What are the most beneficial sectors of real estate when considering investments? Should I think of my home as an investment? Is flipping homes a viable option? What cautions people should take when entering this area of investing Public vs private sector real estate investing How to have a conversation with your advisor to explore if this is a viable and wise investment within the context of your risk tolerance and portfolio diversity Listen at the link below, and if you'd like to hear more about the template we've created on how we analyze real estate investments - please feel free to reach out to us.
Tue, April 21, 2020
Should I Invest In Oil? | Erik Averill, Brandon Averill | AWM Insights #7
After another week of wild financial markets, we saw another historic first yesterday where the price of oil actually went negative. Does this mean you should run out to your local gas station and have them pay you to store gas? Well, no - but it does drive home an important point: You can't predict the future. At the end of the day, trying to outguess the public markets is a great sales pitch but in reality is just not in the best interest of clients. So should this new development in oil markets make you change up your overall investment strategy? Listen to this week's episode for Erik and Brandon's commentary on this event and their thoughts on the following questions that we've received over the last few days: What impact does this oil price dip have on me as an investor? Is now the time to invest in oil? Is there a way to time public markets like oil to capitalize on dips like the one we're seeing now? What are some approaches to consider when making a concentrated risk? Why making informed decisions in the private markets might be your best bet
Tue, April 14, 2020
What Is Asset Location? | Erik Averill, Brandon Averill | AWM Insights #6
In a time where it can feel like a lot of things are out of our control, there are still some things you can do that add tremendous value to your portfolio. Last week, we discussed one of the methods - tax-loss harvesting - and we'll continue this week by looking at asset location. At its core, asset location is essentially a method of managing multiple accounts as one single portfolio. Research has shown with this practice that you can add .5% to .85% to your after-tax return, which over a 30 year period can be up to an additional 15% after-tax return. Some investments in your portfolio - like bonds - pay you interest. If this is held in a taxable account, it will be taxed annually at a fairly high rate depending on your tax bracket. This ultimately hurts your take home return, so we utilize asset location to ensure those assets are not taxed annually and instead other assets likes stocks are the ones held in your taxable accounts. This is a highly-specialized tactic that gets the most mileage from being utilized with our clients that are in the highest tax bracket with high levels of complexity. Listen for more details and answers to questions including: What is asset location? How does asset location work? How can this practice save money over the long-term? Who most benefits from this practice? How can I tell if my portfolio is utilizing asset location?
Tue, April 07, 2020
What Is Tax-Loss Harvesting? | Erik Averill, Brandon Averill | AWM Insights #5
The last month has been a wild ride in the financial markets. At one point, we were down 34% and then all the sudden we have seen a quick rebound where - as of today (April 7) - the S&P is up 24.7% from its 52 week low that had been set on March 23rd. As we mentioned last week, what can happen during these times of flux is that people can tend to rely on asking important questions to the wrong people about what to do with their money. We have seen issues where people have put their trust in experience ("I have lived through this before") rather than expertise ("I'm educated, certified, and experienced in this issue"). In today's episode, we highlight another tactic that can prove beneficial for some called Tax-Loss Harvesting. Topics covered include: The importance of expertise over experience What is tax-loss harvesting, and what should I know about it? The two main benefits of tax-loss harvesting When does tax-loss harvesting matter? Who should be benefiting from this practice? Are there times you should not employ this tactic? Is it helpful to have multiple investment advisors? Other strategies that can be utilized during this time
Tue, March 31, 2020
Is This The Bottom? | Erik Averill, Brandon Averill | AWM Insights #4
The financial market upheaval that has accompanied the COVID-19 epidemic has been a teachable moment for investors. The S&P had been down 34% and investors wondered if it would ever stop falling. People were asking if they should take their money out of the markets - another form of trying to time it. Then, in 3 days, the market bounced back 17%, which was the biggest 3-day gain since 1931. As of March 31st, markets have reclaimed nearly 50% of the decline that happened. So then, can we confidently claim that this is the bottom? Does it even matter if we can know or not? There are plenty of voices online and in the media who are ready to tell you who to buy and who to sell, but the questions you should be asking are: Who should we trust with our financial advice? Who is actually qualified to give that advice? Listen to this week's episode to hear Erik and Brandon discuss these topics and more.
Tue, March 24, 2020
Staying The Course During A Downturn | Erik Averill, Brandon Averill | AWM Insights #3
In times of uncertainty, it's human nature to try and control things - specifically within investing. Some of the most frequently asked questions we've received from our clients are: "Should I be reacting right now to try and stop the bleeding?" or "What are ways to utilize this market downturn to turn a seemingly bad financial situation into a good one?" We've also consistently been asked "Is this downturn different then all previous ones?" Ben Carlson compiles some important stats in his recent blog post noting that while the U.S. stock market is currently down roughly 32% from all-time highs, that the market falling even up to 40-50% from previous all-time highs has been a fairly common pattern all the way back to the 1920s. So what should you be doing during this downturn? And what should you be expecting your wealth advisor to be doing during this time? Are there any mitigating steps your advisor should be taking right now that will help to keep your portfolio diverse and set you up for the best possible outcome in the future? Brandon and Erik discuss these questions and more in this week's episode.
Tue, March 17, 2020
What Is Rebalancing? | Erik Averill, Brandon Averill | AWM Insights #2
Welcome back to another edition of AWM Insights. With all the recent public market volatility, we've been highlighting the importance of our long-term investment strategy. Since 1928, there have been 24 bear markets. A unique trait they have all shared is that every one in U.S. history has then led to new all-time highs. However, while it's important to stay patient and stick to the plan - we also don't want to just "do nothing" during this time. In this week's episode, Erik and Brandon begin their discussions on smart financial strategies that we utilize during these market downturns to add tremendous value to portfolios. First, we breakdown the value of Rebalancing and cover items such as: What is rebalancing Why is it so valuable? When should you rebalance? What are the potential pitfalls?
Tue, March 10, 2020
Navigating Financial Markets In Global Crises | Erik Averill, Brandon Averill | AWM Insights #1
Welcome to our new bonus series: AWM Insights! In these mini episodes, we will hear from the AWM team on different topics and resources relevant to our community in 5-7 minute episodes. For our first episode, there is an easy segue with the news of the Covid-19 virus and its impact on global markets. This has been a concern from a human level and a health level - however, our strategy remains the same as it relates to navigating the fluctuating markets. Listen in for more from two of our founders, Erik and Brandon.

AWM Insights Financial and Investment News

Strategic Tax Planning: Maximizing Wealth Beyond Tax Season | AWM Insights #195

Decoding Crypto's Comeback: Navigating Blockchain, Bitcoin ETFs, and Strategies| AWM Insights #194

Economic Trends and Market Insights | AWM Insights #193

Real Estate in the Multi-Generational Wealth Formula | AWM Insights #192

Building a Winning Portfolio | AWM Insights #191

Investing Beyond Elections | AWM Insights #190

Clarifying Misconceptions: The Real Impact of Elections on Markets | AWM Insights #189

Investing Through Elections with Evidence-Based Strategies | AWM Insights #188

Navigating Market Uncertainty and Elections in 2024| AWM Insights #187

A Year of Surprises and Resilience | AWM Insights #186

Reflecting on Your Financial Structure | AWM Insights #185

Measuring Your Financial Success | AWM Insights #184

Scheduling Your Financial Success | AWM Insights #183

Intentionally Personalizing Your Portfolio | AWM Insights #182

Building a Winning Plan | AWM Insights #181

Giving Thanks for Progress | AWM Insights #180

Discipline and Consistency in Moving Markets | AWM Insights #179

How Do Higher Interest Rates Impact Your Investments? | AWM Insights #178

Taking the Guesswork out of Investing | AWM Insights #177

Building a Thoughtful and Productive Financial Framework | AWM Insights #176

The Power of Consistency and Commitment | AWM Insights #175

The Science and Art of Investing | AWM Insights #174

The Multi-Dimensional Framework of a Family Office | AWM Insights #173

Focusing on What You Can Control | AWM Insights #172

Finding the Right Steward for Your Wealth | AWM Insights #171

The Essentials of Wealth and Risk Management | AWM Insights #170

Gathering, Preserving, and Expanding Your Wealth | AWM Insights #169

Magnifying the Impact of Your Wealth | AWM Insights #168

Keeping Investment Returns in Your Pocket | AWM Insights #167

How to Think About Income – The Types, Sources, and Tax Implications of Each | AWM Insights #166

Maximizing Your Physical, Intellectual, & Social Capital | AWM Insights #165

Expanding and Protecting Your Sources of Wealth | AWM Insights #164

Riding the Public Market Rollercoaster | AWM Insights #163

Putting Your Cash to Work | AWM Insights #162

How to Evaluate your Portfolio’s Performance | AWM Insights #161

The Importance of Behavioral Finance | AWM Insights #160

Patience and Persistence in the Markets | AWM Insights #159

The Importance of Consistency and Repeatability in Venture | AWM Insights #158

How to Build a Best-in-Class Venture Portfolio | AWM Insights #157

Selecting the Best Opportunities in the Private Markets | AWM Insights #156

How do we build our Venture Portfolio? | AWM Insights #155

Accessing the Private Markets | AWM Insights #154

Private Market Basics | AWM Insights #153

The Multigenerational Mindset | AWM Insights #152

The US Dollar and Economy | AWM Insights #151

The AI Wave and How It Impacts Your Portfolio | AWM Insights #150

The Basics of Private Market Investing | AWM Insights #149

Building Resilient Portfolios | AWM Insights #148

How Doing the Simple Things Wrong Can Be Disastrous | AWM Insights #147

Rewarded Factors and Outperforming the Market | AWM Insights #146

The Logic Behind Your Stock Holdings | AWM Insights #145

Focusing on What Matters and Tailoring Your Portfolio | AWM Insights #144

The Importance of Protecting What You Need and Risking What You Can | AWM Insights #143

How Robust Planning is Positioning Your Portfolio for Success | AWM Insights #142

Happy 30th Anniversary to Efficient Investing! | AWM Insights #141

Financial Statements and What Really Matters | AWM Insights #140

2023 Kick-off | AWM Insights #139

Year End Review: 2022 | AWM Insights #138

FTX, Inflation, and Navigating Hype Cycles | AWM Insights #137

Is a Recession Coming? | Insights #136

Two Simple Principles to Investing Success | Insights #135

Why Your Portfolio Can Beat the Competition | AWM Insights #134

How Your Portfolio Is Built To Win During Bad Markets | AWM Insights #133

1,982% Return: Are You Willing to Do What It Takes? | AWM Insights #132

Is A Recession Looming? | AWM Insights #131

Is The Market Healthy? | AWM Insights #130

What Rising Rates Mean For You | AWM Insights #129

Guide to Generational Wealth | AWM Insights #128

Aligning Impact and Intent | AWM Insights #127

What Protection Do I Need? | AWM Insights #126

Building a Family Focused Investment Plan | AWM Insights #125

One Net Worth and One Tax Rate | AWM Insights #124

Do You Need a Family Office? | AWM Insights #123

Is Ultra-High Net Worth Advice Different? | AWM Insights #122

What Can You Control In Investing? | AWM Insights #121

Emotions and Investing | AWM Insights #120

The Only Free Lunch | AWM Insights #119

Factors of Returns | AWM Insights #118

Pursue the Better Investing Experience | AWM Insights #117