Podcast appearances and mentions of tom romano

Tom Romano taught writing and English methods in USU's English Department from 1991-1995 and consulted with the statewide Utah Writing Project for many years. A 17-year career of high school teaching led to his first book, Clearing the Way: Working with Teenage Writers (1987).

Mark Hoffmann and Tom Romano talk about Las Vegas hotels that are raising resort fees and restaurants are raising their prices for the Super Bowl, American Airlines is cutting hundreds of call center positions. Charlies says flying cars, drones and other traffic is about to compete with airplanes.

This week on the Travel Guys... We have the latest news, tips to make you a smarter traveler, questions from the mailbag, and look ahead to 2024. Mark Hoffman and Tom Romano.

Welcome to the series finale! After more than six years, we are concluding the Unfiltered Finance podcast. It has been our sincere pleasure to inform both our investors, and financial advisors with this offering. Joining our host Tom Romano, for this proverbial curtain call, is Casey Dylan, Consultant from Story Market Services & the original host of Unfiltered Finance. We'll be recalling some of our favorite memories, and discussing what this podcast has meant to the progression of our respective careers. If you have any questions or would like more information, reach out to us at https://symmetrypartners.com/contact-us/ You can also find us on LinkedIn, Facebook, YouTube, and Instagram. As always, we remain invested in your goals. Symmetry Partners, LLC, is an investment advisory firm registered with the Securities and Exchange Commission. The firm only transacts business in states where it is properly registered, excluded or exempted from registration requirements. Registration of an investment adviser does not imply any specific level of skill or training and does not constitute an endorsement of the firm by the Commission. No one should assume that future performance of any specific investment, investment strategy, product or non-investment related content made reference to directly or indirectly in this material will be profitable. As with any investment strategy, there is the possibility of profitability as well as loss. Due to various factors, including changing market conditions and/or applicable laws, the content may not be reflective of current opinions or positions.   Please note the material is provided for educational and background use only. Moreover, you should not assume that any discussion or information contained in this material serves as the receipt of, or as a substitute for, personalized investment advice. 

Travel News. Frequent Flyer programs. TSA Security Items. Which gift carts are best? Hosted by Mark Hoffmann and Tom Romano.

Rising oil prices have animated market participant's fears of reinvigorated inflation pressures, increasing the chances that the Federal Reserve will impose more interest rate hikes. Join Casey Dylan, CIMA®, Investment Communications Strategist (Consultant), and Tom Romano our Head of Strategic Relationships & Product Development, for a detailed recap of some notable market events from Q3 of this year. If you have any questions or would like more information, reach out to us at https://symmetrypartners.com/contact-us/ You can also find us on LinkedIn, Facebook, YouTube, and Instagram. As always, we remain invested in your goals. Symmetry Partners, LLC, is an investment advisory firm registered with the Securities and Exchange Commission. The firm only transacts business in states where it is properly registered, excluded or exempted from registration requirements. Registration of an investment adviser does not imply any specific level of skill or training and does not constitute an endorsement of the firm by the Commission. No one should assume that future performance of any specific investment, investment strategy, product or non-investment related content made reference to directly or indirectly in this material will be profitable. As with any investment strategy, there is the possibility of profitability as well as loss. Due to various factors, including changing market conditions and/or applicable laws, the content may not be reflective of current opinions or positions.   Please note the material is provided for educational and background use only. Moreover, you should not assume that any discussion or information contained in this material serves as the receipt of, or as a substitute for, personalized investment advice. 

Markets were off to one of the best start in decades during the first half of 2023—then came the third quarter. The Federal Reserve resumed increasing rates, bringing them to a 22-year high at the Federal Open Market Committee (FOMC) meeting at the end of July. This led to ongoing elevated interest rates through August, pushing bond yields higher and challenging lofty equity valuations. In this episode, Casey Dylan, CIMA®, Investment Communications Strategist (Consultant), and Tom Romano our Head of Strategic Relationships & Product Development, will provide timely insights, and analysis, on market activity from around the world this financial quarter. We will also discuss what this could mean for long-term term investors. If you have any questions or would like more information, reach out to us at https://symmetrypartners.com/contact-us/ You can also find us on LinkedIn, Facebook, YouTube, and Instagram. As always, we remain invested in your goals. Symmetry Partners, LLC, is an investment advisory firm registered with the Securities and Exchange Commission. The firm only transacts business in states where it is properly registered, excluded or exempted from registration requirements. Registration of an investment adviser does not imply any specific level of skill or training and does not constitute an endorsement of the firm by the Commission. No one should assume that future performance of any specific investment, investment strategy, product or non-investment related content made reference to directly or indirectly in this material will be profitable. As with any investment strategy, there is the possibility of profitability as well as loss. Due to various factors, including changing market conditions and/or applicable laws, the content may not be reflective of current opinions or positions.   Please note the material is provided for educational and background use only. Moreover, you should not assume that any discussion or information contained in this material serves as the receipt of, or as a substitute for, personalized investment advice. 

This week, we work to define evidence-based investing, and explain some of the potential benefits of using this strategy. In part one of this two-part episode, our own Tom Romano, Head of Strategic Relationships and Product Development, is joined by Dr. John B. McDermott, Executive Director of Investments, for a historical retrospective on this fastidious investment approach. If you have any questions or would like more information, reach out to us at https://symmetrypartners.com/contact-us/ You can also find us on LinkedIn, Facebook, YouTube, and Instagram. As always, we remain invested in your goals. Symmetry Partners, LLC, is an investment advisory firm registered with the Securities and Exchange Commission. The firm only transacts business in states where it is properly registered, excluded or exempted from registration requirements. Registration of an investment adviser does not imply any specific level of skill or training and does not constitute an endorsement of the firm by the Commission. No one should assume that future performance of any specific investment, investment strategy, product or non-investment related content made reference to directly or indirectly in this material will be profitable. As with any investment strategy, there is the possibility of profitability as well as loss. Due to various factors, including changing market conditions and/or applicable laws, the content may not be reflective of current opinions or positions.   Please note the material is provided for educational and background use only. Moreover, you should not assume that any discussion or information contained in this material serves as the receipt of, or as a substitute for, personalized investment advice.     

In this final installment discussing Q2 of 2023, we dive into current events, and their potential effects on the Stock Market. Our hosts, Tom Romano, Head of Strategic Relationships & Product Development and Casey Dylan, CIMA®, Consultant sit down for a discussion of the "magnificent seven" growth stock winners, the current state of inflation, interest rates, heavily tilted tech stocks, changes among international markets, and the recent repeal of the Black Sea grain deal by Russia.  Click here to watch the full Quarter-in-Perspective on YouTube. If you have any questions or would like more information, reach out to us at https://symmetrypartners.com/contact-us/ You can also find us on Facebook, YouTube, Twitter, and LinkedIn. As always, we remain invested in your goals. Symmetry Partners, LLC, is an investment advisory firm registered with the Securities and Exchange Commission. The firm only transacts business in states where it is properly registered, excluded or exempted from registration requirements. Registration of an investment adviser does not imply any specific level of skill or training and does not constitute an endorsement of the firm by the Commission. No one should assume that future performance of any specific investment, investment strategy, product or non-investment related content made reference to directly or indirectly in this material will be profitable. As with any investment strategy, there is the possibility of profitability as well as loss. Due to various factors, including changing market conditions and/or applicable laws, the content may not be reflective of current opinions or positions.   Please note the material is provided for educational and background use only. Moreover, you should not assume that any discussion or information contained in this material serves as the receipt of, or as a substitute for, personalized investment advice. 

Despite a somewhat lackluster April and May, equities markets ended one of the better first halves of a year in quite some time by the end of June. The Nasdaq, S&P 500, and Dow were up 32.32%, 16.89%, and 4.94% for the year, respectively. It was the Nasdaq's best first half of a year since 1983, primarily due to growth in tech stocks driven by the surge in artificial intelligence. In this first of two parts, we discuss quarterly returns for Q2 2023. Casey Dylan, CIMA®, Consultant, and Tom Romano, Head of Strategic Relationships and Product Development, will provide timely insights and analysis on what happened in markets and economies around the world in the second quarter and what this means for long-term term investors. Click here to watch the full Quarter-in-Perspective on YouTube. If you have any questions or would like more information, reach out to us at https://symmetrypartners.com/contact-us/ You can also find us on Facebook, YouTube, Twitter, and LinkedIn. As always, we remain invested in your goals. Symmetry Partners, LLC, is an investment advisory firm registered with the Securities and Exchange Commission. The firm only transacts business in states where it is properly registered, excluded or exempted from registration requirements. Registration of an investment adviser does not imply any specific level of skill or training and does not constitute an endorsement of the firm by the Commission. No one should assume that future performance of any specific investment, investment strategy, product or non-investment related content made reference to directly or indirectly in this material will be profitable. As with any investment strategy, there is the possibility of profitability as well as loss. Due to various factors, including changing market conditions and/or applicable laws, the content may not be reflective of current opinions or positions.   Please note the material is provided for educational and background use only. Moreover, you should not assume that any discussion or information contained in this material serves as the receipt of, or as a substitute for, personalized investment advice. 

Today we conclude our discussion on women investors from AdvisorFest 2023. Symmetry's Andrea Loin, Associate Director of Marketing, leads a discussion along with financial advisors Diana Bacon, CFP®, CDFA®, MBA, and Joyce Bloomquist, CDFA® of Apella Wealth, on some of the critical factors, and life experiences, that should be incorporated into a woman's financial plan. If you have any questions or would like more information, reach out to us at https://symmetrypartners.com/contact-us/ You can also find us on Facebook, YouTube, Twitter, and LinkedIn. As always, we remain invested in your goals. Symmetry Partners, LLC, is an investment advisory firm registered with the Securities and Exchange Commission. The firm only transacts business in states where it is properly registered, excluded or exempted from registration requirements. Registration of an investment adviser does not imply any specific level of skill or training and does not constitute an endorsement of the firm by the Commission. No one should assume that future performance of any specific investment, investment strategy, product or non-investment related content made reference to directly or indirectly in this material will be profitable. As with any investment strategy, there is the possibility of profitability as well as loss. Due to various factors, including changing market conditions and/or applicable laws, the content may not be reflective of current opinions or positions.   Please note the material is provided for educational and background use only. Moreover, you should not assume that any discussion or information contained in this material serves as the receipt of, or as a substitute for, personalized investment advice. Symmetry Partners and Apella Wealth are affiliated entities.   Transcript:   00;00;00;00 - 00;00;37;05 Unknown Hello and welcome back to Unfiltered Finance. I'm Tom Romano. Your host today, Andrea Line, assistant director of marketing, concludes our discussion on women investors with Dianna Bacon and Joyce Blomquist Financial Advisors with a paella wealth. You'll find some sage advice here for women who are working to assert their financial independence and plan for the future. Enjoy. If I'm an advisor working with several women investors, what are some tips that you could give them to starting that initial and being that that advisor? 00;00;37;05 - 00;01;00;06 Unknown You set it right there. Don't be condescending. What kind of tips would you give to an advisor working with this demographic, say, you know, joint? I mean, it's hard, right? Because you could be a male advisor trying to reach out to the women's group. Absolutely. So but you're probably less likely to join the women's community groups. That might be awkward, but definitely if you're a female advisor, get involved in the community with some of the community groups. 00;01;00;06 - 00;01;16;28 Unknown Even if you're a male advisor and you want to reach out to the women's group and help out, you know, it doesn't have to necessarily be all women's group. There's going to be women who are participating in these community groups. I say branch out in your community and see what kind of groups are related to investments, and maybe that's a good start. 00;01;16;29 - 00;01;37;16 Unknown Webinars. I mean, we have our webinar that we've been doing periodically, and I think we've gotten a really great group of people and they're not all women. We have a lot of men that join our groups too. So I think if you're you're spreading the word out there, you might be casting a wide net too to both groups, but you know, everyone's listening. 00;01;37;16 - 00;01;58;19 Unknown And so maybe it's not just a niche of just women, but they're part of that group can see that there is some understanding and they don't feel intimidated to come in and talk to you. And I think that's what's most important is that making them feel comfortable, because I know that even when I see married couples come in to our offices, you can tell right away the women's fair, the woman is very quiet. 00;01;58;20 - 00;02;17;13 Unknown Maybe the man's taking over the whole meeting. You can tell immediately really who has been doing the finances there. So really try to communicate with that spouse in that meeting and say, hey, you're part of this. What do you have? What's your input on this? But and then, you know, sometimes they're surprised and they they look at me like, oh, gosh, I really don't participate in this. 00;02;17;13 - 00;02;42;21 Unknown I'm just here to listen. But making them feel part of the conversation is so key. And pulling on one of the threads that Joyce touched on. One of the best things to do, particularly if you want to go into this, you're worried about sounding condescending because we know most advisors are men. Depending on what portion of the industry you're looking at, it's either, you know, 23% are women, 18% are women. 00;02;42;23 - 00;03;09;14 Unknown CFP, CFA. So make sure you're talking with them and not to them. Don't talk at them, pull them into the conversation. The best way to find out what their knowledge level is is to be having the conversation going through the accounts. They're going through a tax return, walking them through some of it. They might know, some of it they might not. 00;03;09;16 - 00;03;31;05 Unknown But if you're in a real true conversation, you're using your listening skills, you're keeping your mouth shut a good bit and letting them speak, that that's the first way to get into this area. I couldn't agree more. And people love stories, right? They love to know that you've been through the same things that maybe they have. It makes you real. 00;03;31;05 - 00;03;47;20 Unknown They mentioned a divorce. Hey, you know, I went through a divorce. Sorry to hear that. You did, too. Immediately they connect with you. Maybe that's a story that can relate to them. They know you've had that real life experience. And so they can really relate to that situation and and maybe open up a little bit more towards you. 00;03;47;22 - 00;04;07;11 Unknown Yeah, women are emotional. We make decisions on emotions. And I personally, when I picked my financial advisor, it was a connection I had. It wasn't, you know, they, they listened to me, Diana, They, they heard me. And I was not educated before. I didn't always work in this industry and I wasn't educated, but they didn't make me feel uneducated. 00;04;07;12 - 00;04;25;24 Unknown I don't know everything, so I don't want you to make me feel bad for not knowing everything. So when I met with a financial advisor the first time, that was exactly what it was. It was emotional connection. You know, this is somebody you're telling things you may not tell anyone else in your life. You know, monetary stuff is still taboo, you know, And I wanted a connection. 00;04;25;24 - 00;04;53;24 Unknown So you're totally right there. One of the things there's a lot of inequalities, right, that are still out there. How do you address those? There's gender specific issues, the pay gap, the career breaks, the caregiving responsibilities in that financial plan. So how do you take that? Because there was a stat that I read, it kind of made me sick to my stomach, but it was on average women experience an $80,000 lifetime pay gap when compared to men. 00;04;53;25 - 00;05;18;03 Unknown That's various factors that are, you know, controlled by controlling that. But there is a huge gap. How do you account for that in your financial plan for them? Do you account for that or do we just go by their plan and specific to them? Anyone working with women, if you're working with any marginalized group and in some areas women are marginalized, you need to address those specific issues with that group. 00;05;18;03 - 00;05;45;23 Unknown I am a strong believer that an advisor you have to not deal with gender generalities, but that client. So and I'm going to stay on that marginalize. If you are working with a woman of queer woman. Now that pay group gap has just expanded to women of color. Again, that gap has expanded less opportunities. We can we can put on our rose colored glasses and pretend like that doesn't happen, but it absolutely does. 00;05;45;23 - 00;06;10;13 Unknown And we know because we hear it from our friends, we see it with our clients, it's happening in real time. So not only do you want to look at that decreased salary, likely decrease raises, you want to adjust for that in any long term cash flow. Also increase spending. Mothers are more likely to help their adult children financially. 00;06;10;15 - 00;06;40;19 Unknown They're more likely to be burdened with. Not that it's a burden, but it is on time and resources with caring for parents, which means less time to work, less flexibility. And sometimes you cost on them, especially with the mother, because we know that aging women retire with less assets. I mean, all these statistics are so disheartening. I mean, I get to an area when you're like, I want to read anymore, I want to stick my head in the sand. 00;06;40;22 - 00;07;04;18 Unknown Yeah, you're right, Diane. At 95% of women at some point will be their families. Primary financial decision maker. We have we live longer. Our longevity is there. Many times we will outlive our husbands and be alone. These aren't just divorces. These are. This is widowhood. Later in life, many reasons why at some point in our lives we will be the primary financial decision maker. 00;07;04;20 - 00;07;26;17 Unknown These are important things to talk about. And in the long term plan, I have children health care costs that go along with having children. Your body changes and your health care costs increase. Do you do you incorporate that into the plan? Woman is going to have a family. I know it's not necessarily as big of an issue as you know before, but health care costs are going to be huge for for females. 00;07;26;18 - 00;07;52;21 Unknown Yeah, there's going to be an extra health care cost. Do you include that? Do you think of that in the plan? One thing I do in it is that a personal hard subject, but when I am working with a younger professional single woman, I ask what her fertility plans are. Oh, cause I am seeing a great deal of women. 00;07;52;21 - 00;08;26;06 Unknown Now you say I make great money. I don't. I don't need a partner. You're absolutely right. There have been single mothers since the beginning of time, and a will always happen. But that means you have to have a plan, adoption, you know, whatever they're going to do. Financial. Now you are the only caregiver for that child. So now we have more stress on life insurance. 00;08;26;09 - 00;08;59;21 Unknown You know, estate planning, guardianship. So it's not just the, you know, the increased costs. I have teenagers. Yes, I know that. Braces and broken ankles and broken wrist and yeah, all of that. So we do have those increased cost, but it's also I see more single women than men deciding on their parenthood as single people in the financial side of that is huge. 00;08;59;21 - 00;09;25;16 Unknown And that is an area where we're not only affecting the lives and providing value for that woman, but also for her future children and ensuring their security. Yeah, that makes perfect sense. Any other? I appreciate you both jumping on. And couple of times we've referenced the series that Diana and Joyce are both a part of at Capella. It's the Financial Independence for Women series. 00;09;25;16 - 00;09;45;12 Unknown You can find it on our Web site at Palo Health.com if you're interested. You know, take a listen. They have some great topics on there that are not just for women, but that will definitely help drive home some some great points. So take a look and take a listen. And I do appreciate you both jumping on as we conclude. 00;09;45;12 - 00;10;08;05 Unknown We hope that you as advisors have gain valuable insights into working with women investors by recognizing their unique perspectives, addressing their specific needs, and fostering that inclusive environment that we talked about. You can create a future where women investors thrive and they contribute to the growth and stability of the global economy and hopefully shrink some of those statistics that we started out with in the beginning of this, this webinar. 00;10;08;05 - 00;10;31;10 Unknown So if you have any questions, we can take a few questions for Joyce and Diana right now. I wanted to make one quick comment. Andrea. You had said that women make decisions emotionally. That's actually not been my experience. Oh, women do cling on to their fear much more than men, so that might stop them from taking first steps. 00;10;31;17 - 00;10;57;18 Unknown But I find women to be very pragmatic. And for advisors who are going to be working with women, expect the why? Why am I doing this? Why is that? V There I find that as women become educated and on their finances, they're happy to dig in, but they want to know why and they want every pass to be explained to them so that they know they're getting value for that dollar. 00;10;57;19 - 00;11;28;06 Unknown I've always found women extremely pragmatic. Yeah, that makes sense. I'm detail oriented. I want to know the down in the weeds information. Yeah, that makes perfect sense. So yeah. So make sure make sure you're ready to answer those questions, especially the single moms. Yep. And they know how to balance time and and figure out every little loophole they can to do their time and manage it well. 00;11;28;06 - 00;11;51;11 Unknown So while I do appreciate both Diana and Joyce joining us today and look forward to working with you all more in the future, thank you very much for joining us today. If you're a financial professional and you'd like to learn more, check the link in this episode's description to view all of the presentation from Advisor Fest 2023. As always, you can listen to all of our past episodes anywhere you get your podcasts. 00;11;51;18 - 00;12;18;15 Unknown Thank you very much and we'll see you soon. Cemetery Partners LLC is an investment advisor firm registered with the Securities and Exchange Commission. The firm only transacts business in states where it is properly registered or excluded or exempted from registration requirements. Registration of an investment advisor does not imply any specific level of skill or training and does not constitute an endorsement of the firm by the Commission. 00;12;18;17 - 00;12;48;14 Unknown No one should assume that future performance of any specific investment investment strategy, product or non investment related content made reference to directly or indirectly in this material will be profitable. As with any investment strategy, there is the possibility of profitability as well as loss due to various factors, including changing market conditions and or applicable laws. The content may not be reflective of current opinions or positions. 00;12;48;16 - 00;13;10;06 Unknown Please note the material is provided for educational and background use only. Moreover, you should not assume that any discussion or information contained in this material serves as the receipt of or is a substitute for personalized investment advice. Symmetry Partners and APL Wealth are affiliated entities.  

Two weeks ago, we held another successful week of AdvisorFest - an annual, week-long live-streaming event where we cover some of the most pressing issues Financial Advisors are presently facing. This year, we decided to host a live panel discussion about the experiences women have when creating long-term financial plans, and asserting an equal amount of authority in the handling of their household finances.  Our very own Andrea Loin, Associate Director of Marketing, led a discussion along with financial advisors Diana Bacon, CFP®, CDFA®, MBA, and Joyce Bloomquist, CDFA®, of Apella Wealth. You'll find some genuinely moving stories of challenges faced, and overcome by women investors here. We hope you find this episode to be insightful. Enjoy. If you have any questions or would like more information, reach out to us at https://symmetrypartners.com/contact-us/ You can also find us on Facebook, YouTube, Twitter, and LinkedIn. As always, we remain invested in your goals. Symmetry Partners, LLC, is an investment advisory firm registered with the Securities and Exchange Commission. The firm only transacts business in states where it is properly registered, excluded or exempted from registration requirements. Registration of an investment adviser does not imply any specific level of skill or training and does not constitute an endorsement of the firm by the Commission. No one should assume that future performance of any specific investment, investment strategy, product or non-investment related content made reference to directly or indirectly in this material will be profitable. As with any investment strategy, there is the possibility of profitability as well as loss. Due to various factors, including changing market conditions and/or applicable laws, the content may not be reflective of current opinions or positions.   Please note the material is provided for educational and background use only. Moreover, you should not assume that any discussion or information contained in this material serves as the receipt of, or as a substitute for, personalized investment advice.   Transcript: 00:00:07:01 - 00:00:37:17 Speaker 1 Hello and welcome back to Unfiltered Finance. I'm your host, Tom Romano. Two weeks ago, we held another successful week of Advisor Fest, an annual week long live streaming event where we cover some of the most pressing issues financial advisors are facing today. In part one of this special episode on Women investors, our very own Andrea Loin associate director of marketing, leads a discussion along with financial advisers Diana Bacon and Joyce Blomquist of Apollo Wealth will discuss some cautionary tales that can help investors learn which mistakes to avoid on their financial journey. 00:00:37:19 - 00:00:41:09 Speaker 1 We hope you find this episode to be insightful. Enjoy. 00:00:41:11 - 00:01:06:15 Speaker 2 Welcome everyone to the final session of our third Annual Advisor fest. Empowering Women Investors Navigating Financial Success Together. We're thrilled to have you here today as we embark on a journey to explore empowerment of women in the world of investing. During this webinar, we want to shed light on the unique perspectives and experiences of women investors and provide practical insights on how to effectively engage and support this growing demographic. 00:01:06:16 - 00:01:30:05 Speaker 2 Graphic It's important that we promote awareness and understanding of the specific challenges and opportunities faced by women investors in doing this, we hope to foster an inclusive environment and equip advisors like yourselves with the knowledge and tools to better serve women investors, which will ultimately lead to their financial success and empowerment. I have with me two financial advisors that work with Capella wealth, one of our sister firms. 00:01:30:05 - 00:01:44:08 Speaker 2 We have Diana Bacon. She's a CFP and a CDPHE and she has years of experience working in this very wonderful demographic. And we've Joyce Bloomquist, who is a cafe as well, also an advisor with Pell Wealth. Welcome. 00:01:44:09 - 00:01:47:00 Speaker 3 Thank you. Glad to be here today. 00:01:47:01 - 00:02:07:21 Speaker 2 Thank you for joining us. I read a statistic in doing research for this whole thing that really it surprised me because I'm a woman. I work in an investment firm. So I just assume I know all there is to know, but I don't. So about 39% of women have no retirement strategy. That seems like a very high number to me. 00:02:07:21 - 00:02:29:11 Speaker 2 So I looked it up and I was like, So what percentage of men don't have a retirement strategy? And it's only 25%. So there's a big gap there. It was shocking to me. And then I just assumed, right, we're in the 2023. Things should be the same for everybody, but they're not. And so coming together to discuss how do we to we do we grow that number or actually shrink that number down to be less. 00:02:29:11 - 00:02:46:17 Speaker 2 We want more women to have a plan for retirement. So, Diana, what are some strategies that you have that you use when addressing women investors with the challenges that are faced by them? How do you give them tools and tips and tricks to help them close that gap? 00:02:46:21 - 00:03:19:05 Speaker 3 Women in general, and you know, this is not some little niche. This is a huge market segment. We are 51% of the population To say women are all like X is very decent, enormous. However, we do see continuing themes over and over. The first is women. And we were raised this way, especially in the Western world. Well, actually, I would say while we're global globally, we never put ourselves first. 00:03:19:05 - 00:03:42:02 Speaker 3 And when I hear the statistic of the number of women who don't have a retirement plan, what do you have to do to have a retirement plan? You have to save. You have to invest. You have to be thoughtful of yourself. Make sure you either have that income stream or the assets to support you. And so the first thing that I work with a client is to change their money mindset. 00:03:42:04 - 00:03:48:22 Speaker 3 They need to put themselves first. I'm going to use the S-word. We got to be selfish. 00:03:49:00 - 00:03:53:12 Speaker 2 And that's really hard. Especially especially for me. I would have a hard time doing that. 00:03:53:14 - 00:04:12:17 Speaker 3 And it is. Yeah, yeah. I mean, think about it. Like having to say, I'm going to give my adult kids less as they're launching in life, but I want to do all this for them. I love them. You know, I have nurtured them, but I'm going to do less for them because I have to do for me for that. 00:04:12:17 - 00:04:32:05 Speaker 3 You know, I want to save for their college so they don't have to go through the things I did. All those things are prioritizing yourself. That is extremely difficult for women. So they got to start in that word, start to be selfish, and then get away with the H word shame. 00:04:32:10 - 00:04:46:18 Speaker 4 That is such a good point. I love it because I'm in this open space now. My kids are 20 and 22 and they see when do we let them go and be adults and when do we start saving like we should for. 00:04:46:18 - 00:05:01:11 Speaker 3 Ourselves that say And so many women start off because we have some credit card debt or paid too much on our car loan or, you know, just all these things that come up and we just put that shame on ourselves and then we don't deal with our finances. 00:05:01:13 - 00:05:19:10 Speaker 2 I like that you put the shame part of that and getting rid of the shame because I think being selfish is hard enough. But then you start to feel bad when you start to look at things. For me, it was matching my 41k, right? I'm like, Well, that takes away from money coming into the family. And and then I started realizing, No, it doesn't. 00:05:19:12 - 00:05:27:00 Speaker 2 It helps the long run. I'm doing it for me. I have to watch out for myself. So taking the shame out of it, that's probably harder than being selfish, to be honest. 00:05:27:02 - 00:05:32:18 Speaker 4 Yeah, We're caregivers, right? That's where we're moms, first and foremost. And it's hard to let that go. Yep. 00:05:32:21 - 00:05:51:13 Speaker 2 Caregivers is a good thing. Diana, your you did a webinar recently on closing that career, the career change and how to approach that career change. And I thought it was a great webinar. Not a lot of women think about that when they're leaving the workforce. I left for a couple of years, went back and not a lot of women think about what happens when you go back. 00:05:51:13 - 00:06:04:12 Speaker 2 And I think your webinar really opened up, you know, how to get back into the game and then how to be, again, selfish, how to focus on you to put yourself in a better space in life, in a better spot when you're trying to get back into the game. 00:06:04:14 - 00:06:32:12 Speaker 3 That's another area to that employment because so many women are underemployed to better support the family. Mm hmm. And the shame of saying, No, I want to do this. I want to have more of my earnings, particularly if, say, maybe your marriage or partnership isn't as steady and strong. The first thing when people are like, oh, I'm taking it, or when women are thinking about getting divorced, I'm like, Get a job or get a better job right now. 00:06:32:14 - 00:06:33:15 Speaker 4 Don't wait. 00:06:33:17 - 00:06:36:02 Speaker 3 Don't wait. Do it right now. 00:06:36:04 - 00:06:53:06 Speaker 2 See how that goes back to that, that shame and that self. Right. And be something I would find hard to do. But my husband is that I am what he calls the breadwinner of the family. And he tells all of his friends about it. And for me, that when I started to take on more, I felt like I was letting my family down. 00:06:53:12 - 00:07:09:06 Speaker 2 Right. You have to make that choice. And I realized I wasn't financially. I was helping my family, my 41k is growing, our family's growing, his 41k is growing. We're all working together. But I had to focus on me and make sure that I did that side of it, too. You actually hit on a great topic, Diana, and Joyce. 00:07:09:06 - 00:07:33:08 Speaker 2 I'm going to I'm going to start with you on this one. But a lot of the marriages might not be as solid, right? So I was divorced young and didn't even know that there was an option for me as far as financial planning goes. But can you explain how you would approach addressing the potential impact of divorce or even what would a heart a change in a lot of part of a big part of your life on a woman's financial situation? 00:07:33:10 - 00:07:48:12 Speaker 2 What makes it unique and different for that? Because I didn't even know what a CDF was until about five years ago and realizing that as someone who went through divorce, I could have had someone helping me too because I didn't realize what I was going through was unique. 00:07:48:14 - 00:08:09:02 Speaker 4 Right. And I have some input on that. You know, I've been through a divorce, too, and I think some of the things that are hard to wrap your arms around are when you're starting, you're kind of going from being with a partner to being by yourself. I mean, I think Diana's first point out of, you know, get back to work if you can and if it's possible, you know, we we want that to be the ultimate goal for the person. 00:08:09:04 - 00:08:26:07 Speaker 4 Why? It might not seem like you're making much at the time. I mean, maybe you got daycare costs and all that and maybe a lot of that money's going to their daycare costs and there's things in your mind or maybe you're saying, why am I even doing this? I mean, when I'm actually take it home isn't much after I pay all these people, but you're participating in Social Security. 00:08:26:07 - 00:08:53:19 Speaker 4 So that's important. You probably get your own health care. That's important, and that might make all the difference in the world by stepping into the workforce. At that point, you got to start accumulating those things for yourself. At this point when you go from where to me. And so that's something to really consider. Might not seem like you're bringing home that much, but you are benefiting from the benefits from the workplace, maybe for one K, maybe some free matching as little as you can contribute to the plan. 00:08:54:00 - 00:09:01:20 Speaker 4 There might be some pre matching that you need to consider as all these things are so important to get started back to you when you're going through that process. 00:09:01:23 - 00:09:24:07 Speaker 2 Makes perfect sense. And as an advisor, how do you educate not just women going through these these life changes, but how do you educate women on things that they need to know about their financial, about their finances, about that for one K, about going back to work? And though you think you're not making an impact with what you're making because it may be less than you want to at the time, how do you educate them? 00:09:24:07 - 00:09:35:01 Speaker 2 What are their tools and resources out there for them? Are there ways that you approach it that are different than you would, you know, approach a normal planning client? Are there tools of resources for them? 00:09:35:03 - 00:09:59:21 Speaker 3 I found that women are not educated when we're growing up on money matters the same way that men are. So first is getting the basics and we have the Internet now. So Internet and podcasts are wonderful. So it's like learning a new language. You have to just start jump in. There's a certain lingo to it, so you need to pick that up. 00:10:00:03 - 00:10:31:07 Speaker 3 So starting to listen to podcasts, you might not understand much. The first few try a bunch of them buying a new pair of jeans. You got to make sure it's a fit, you know, try ones. Once you hear things over and over again, will start to click, go on financial websites, read, you know, nerdwallet, Wikipedia, you know, all of these things where you can just start to learn the lingo and then talk to your friends. 00:10:31:09 - 00:11:13:21 Speaker 3 Men are talking to each other about money. We need, again, a sage word shame. Women don't want to talk about money. They don't want to make. They don't want to feel bad that they don't know something. But many women have found that financial services providers can be a little condescending. And that and that's a real struggle. And once you've been spoken down to getting that courage up again, to put yourself out there and ask questions and feel like someone's going to think you're you're not intelligent because you don't know, but how would you know if you never learned it or or. 00:11:13:21 - 00:11:27:23 Speaker 4 If you weren't married? And maybe the husband had it with his responsibility to take care of the finances. And maybe now you're by yourself, You're maybe you're divorced, or maybe you're widowed, and now it's all on you. So where do I start over with all this? 00:11:28:01 - 00:11:48:16 Speaker 3 Yeah. I've sat down with widows who are like, I don't even know where our checkbook is. I don't know how the, like, bill gets paid. I mean, all of these things where they really put it off on someone else, I will say, being involved in your finances, looking at your tax return, a lot of people don't even look at that. 00:11:48:16 - 00:12:10:17 Speaker 3 Look at your tax return. And I am absolutely biased. I will admit it. I'm a financial advisor. I am a certified financial planner. And I think working with a planner as early as you find one that suits you is really a big step in that. 00:12:10:19 - 00:12:28:00 Speaker 1 Thank you very much for joining us today. If you're a financial professional and you'd like to learn more, check the link in this episode's description to view all of the presentations from Advisor Fest 2023. As always, you can listen to all of our past episodes anywhere you get your podcasts. Thank you very much and we'll see you soon. 00:12:28:01 - 00:12:52:19 Speaker 5 Cemetery Partners LLC is an investment advisor firm registered with the Securities and Exchange Commission. The firm only transacts business in states where it is properly registered or excluded or exempted from registration requirements. Registration of an investment advisor does not imply any specific level of skill or training and does not constitute an endorsement of the firm by the Commission. 00:12:52:21 - 00:13:22:18 Speaker 5 No one should assume that future performance of any specific investment, investment strategy, product or non investment related content made reference to directly or indirectly in this material will be profitable. As with any investment strategy, there is the possibility of profitability as well as loss due to various factors, including changing market conditions and or applicable laws. The content may not be reflective of current opinions or positions. 00:13:22:20 - 00:13:38:13 Speaker 5 Please note the material is provided for educational and background use only. Moreover, you should not assume that any discussion or information contained in this material serves as the receipt of or is a substitute for personalized investment advice.    

Financial Advisors don't work for free. Depending on how their practice is structured, investors will be charged an assortment of fees for a financial advisor's services. In this episode of Unfiltered Finance, we are joined by JT Lavery, Symmetry's Associate Director of National Sales, to discuss how fees are structured and how advisors can work to be transparent with their clientele. If you have any questions or would like more information, reach out to us at https://symmetrypartners.com/contact-us/ You can also find us on Facebook, YouTube, Twitter, and LinkedIn. As always, we remain invested in your goals. Symmetry Partners, LLC, is an investment advisory firm registered with the Securities and Exchange Commission. The firm only transacts business in states where it is properly registered, excluded or exempted from registration requirements. Registration of an investment adviser does not imply any specific level of skill or training and does not constitute an endorsement of the firm by the Commission. No one should assume that future performance of any specific investment, investment strategy, product or non-investment related content made reference to directly or indirectly in this material will be profitable. As with any investment strategy, there is the possibility of profitability as well as loss. Due to various factors, including changing market conditions and/or applicable laws, the content may not be reflective of current opinions or positions.   Please note the material is provided for educational and background use only. Moreover, you should not assume that any discussion or information contained in this material serves as the receipt of, or as a substitute for, personalized investment advice. 0 00:00:06.970 --> 00:00:10.520 Hello and welcome to Unfiltered Finance. This is your host, Tom Romano. 1 00:00:10.520 --> 00:00:13.640 And thank you all for joining us for, uh, this edition. 2 00:00:13.930 --> 00:00:16.320 Today we're gonna talk about something that I think, uh, 3 00:00:16.620 --> 00:00:21.160 weighs on a lot of investors' minds. Um, there, there tends to be, uh, 4 00:00:21.400 --> 00:00:24.320 somewhat of a lack of transparency on this topic in the industry. 5 00:00:24.320 --> 00:00:28.400 And the topic is, is fees and all fees associated with investing. 6 00:00:28.460 --> 00:00:32.400 We have the perfect guest for us here today. Uh, JT Lavery, uh, 7 00:00:32.400 --> 00:00:34.040 longtime coworker and friend of mine. 8 00:00:34.070 --> 00:00:37.320 He's the Associate Director of National Sales at Symmetry Partners. Jt, 9 00:00:37.320 --> 00:00:38.440 thanks for joining us here, 10 00:00:38.740 --> 00:00:40.560 Tom. Thanks for having me. Appreciate it. So, 11 00:00:40.740 --> 00:00:43.280 Jt, tell us a little bit about, about your background, um, 12 00:00:43.310 --> 00:00:44.600 working with advisors. 13 00:00:44.870 --> 00:00:48.000 I've been working with advisors, Tom, for about 23 years now, kind of in, 14 00:00:48.000 --> 00:00:51.920 in different facets. Uh, I started off on the service side of things at a, at a, 15 00:00:51.940 --> 00:00:55.720 at a major mutual fund company up in Boston, answering phones and, and, 16 00:00:55.860 --> 00:00:58.080 you know, trying to solve problems. And I, you know, 17 00:00:58.080 --> 00:01:02.160 transitioned over to the sales side, uh, a few years after that. So I have a, 18 00:01:02.160 --> 00:01:05.880 you know, pretty good background working with advisors that were more on the, 19 00:01:05.880 --> 00:01:07.240 uh, commission side of things, 20 00:01:07.380 --> 00:01:10.640 as well as advisors that are on the fee-based side of things. For 21 00:01:10.640 --> 00:01:14.160 Our listeners, um, describe the difference between the two because I, 22 00:01:14.240 --> 00:01:18.000 I think a lot of folks out there don't know if they're paying fees or 23 00:01:18.000 --> 00:01:18.700 commissions, and, 24 00:01:18.700 --> 00:01:22.760 and I've heard many times talking to investors that they don't think they pay 25 00:01:22.920 --> 00:01:23.630 anything. Mm-hmm. 26 00:01:23.630 --> 00:01:26.120 Yeah. So, uh, you know, commissions are paid out, uh, by, 27 00:01:26.120 --> 00:01:27.240 let's say a mutual fund company. 28 00:01:27.390 --> 00:01:30.680 They will pay out a commission to the advisor who sells that particular mutual 29 00:01:30.710 --> 00:01:32.080 fund to, uh, to their client. 30 00:01:32.460 --> 00:01:36.400 And it's could be paid out in a very various of different ways. Um, you know, 31 00:01:36.400 --> 00:01:39.240 if it's a shares, it'll be an upfront sales charge, B shares, 32 00:01:39.240 --> 00:01:40.760 which don't even think is even a thing anymore. 33 00:01:40.760 --> 00:01:43.760 It was a contingent deferred sales charge. There was no upfront sales charge, 34 00:01:43.980 --> 00:01:46.680 but it was a declining sales charge As time goes on and you, 35 00:01:46.700 --> 00:01:49.120 and you were to sell that particular holding, you know, the, 36 00:01:49.120 --> 00:01:53.120 the sales charge would be reduced. And then you also had c shares that were, 37 00:01:53.140 --> 00:01:56.280 you know, about a 1%, you know, uh, uh, trail that would, uh, 38 00:01:56.350 --> 00:01:57.800 that would pay out to the advisors. 39 00:01:57.800 --> 00:02:00.520 And those are paid through various fees that are within the mutual funds that 40 00:02:00.520 --> 00:02:03.040 the mutual fund companies, uh, structure around, you know, 41 00:02:03.040 --> 00:02:05.520 marketing of their particular products as well as, um, 42 00:02:05.540 --> 00:02:06.920 as selling those particular products, 43 00:02:06.930 --> 00:02:10.200 verse the fee side of things where it's advisors are just simply charging a fee 44 00:02:10.200 --> 00:02:13.640 for their advice. They're advising their clients on what they should be doing. 45 00:02:14.180 --> 00:02:17.240 Um, there's often, there's more than just, um, more advice, 46 00:02:17.310 --> 00:02:20.400 more than just advice that goes into it. It's, you know, financial planning, 47 00:02:20.680 --> 00:02:23.040 holistic planning and things like that. But it's generally a, 48 00:02:23.120 --> 00:02:25.760 a fee that's fully disclosed that they, that they pay. 49 00:02:26.300 --> 00:02:29.560 And the way most advisors will structure their fees, 50 00:02:29.590 --> 00:02:32.440 they'll structure 'em in such a manner that the more money you have, uh, 51 00:02:32.440 --> 00:02:34.840 you'll start to see those fees actually go down. So 52 00:02:34.840 --> 00:02:37.360 What I'm hearing you say, it sounds like, and I think the, 53 00:02:37.460 --> 00:02:39.800 you said contingent deferred sales charge, right? 54 00:02:39.860 --> 00:02:43.280 If if you're earning a commission, that is a, it's a sales charge, correct? 55 00:02:43.370 --> 00:02:48.040 Right. Whereas, uh, fee for advice is exactly that, 56 00:02:48.240 --> 00:02:51.480 right? It's a fee for, for giving advice so that it's not necessarily a, 57 00:02:52.040 --> 00:02:53.600 a sales charge. Um, 58 00:02:53.660 --> 00:02:56.200 why do you think it's important for investors to know the difference between the 59 00:02:56.200 --> 00:02:56.760 two? Well, 60 00:02:56.760 --> 00:02:59.440 It's important for them to know the difference. It's, 61 00:02:59.440 --> 00:03:02.040 I think it's just important for them to know what they're, what they're getting. 62 00:03:02.090 --> 00:03:05.040 First of all, commissions. You can say that there's, you know, 63 00:03:05.280 --> 00:03:08.120 conflicts of interest perhaps. Are they getting sold something that, 64 00:03:08.230 --> 00:03:10.880 that has a higher commission that, that, you know, 65 00:03:10.880 --> 00:03:14.040 the advisor's gonna get paid more money on, you know, verse, you know, 66 00:03:14.040 --> 00:03:14.873 they always say, you know, 67 00:03:15.000 --> 00:03:19.000 a fee-based advisor usually will generally sort of align themselves with the 68 00:03:19.000 --> 00:03:22.040 client, let's say, on the, on the same side of the table, so to speak. They're, 69 00:03:22.040 --> 00:03:25.400 they're, they're going in as a team, we're here to, you know, you got your, 70 00:03:25.420 --> 00:03:27.120 you want to get from point A to point B, 71 00:03:27.210 --> 00:03:28.800 let's figure out the best way to do that, 72 00:03:28.800 --> 00:03:31.680 and then we'll put you in the appropriate investments. And, you know, 73 00:03:31.680 --> 00:03:34.040 because they're not, you know, getting any commissions, you know, 74 00:03:34.040 --> 00:03:35.680 generally speaking, there's a, I think, 75 00:03:35.760 --> 00:03:39.240 a certain comfort level knowing that the investment solution's gonna be right 76 00:03:39.240 --> 00:03:39.780 for them. 77 00:03:39.780 --> 00:03:42.360 No, that, that's a really great explanation. And you know, this, 78 00:03:42.510 --> 00:03:45.160 this podcast where, where our advocates of, 79 00:03:45.220 --> 00:03:47.200 of financial advisors and financial advice, 80 00:03:47.200 --> 00:03:51.400 I've said many times before that I always get asked, you know, what's a, 81 00:03:51.400 --> 00:03:54.520 what's a great stock tip? What's a great tip? What's some advice for investing? 82 00:03:54.520 --> 00:03:57.520 And my advice is always work with a, a fee advisor, 83 00:03:58.030 --> 00:04:00.200 because that advice is extremely valuable. 84 00:04:00.470 --> 00:04:05.280 What are you seeing the average on the fee based side average advisory fees in 85 00:04:05.280 --> 00:04:09.360 the industry? What should investors, what should they know about advisory fees? 86 00:04:09.580 --> 00:04:10.720 Um, just generally? Yeah, generally, 87 00:04:10.720 --> 00:04:13.280 Generally speaking, I would, I would say that the, you know, 88 00:04:13.280 --> 00:04:18.160 the average fee probably comes in around 1%. Um, you know, we see, you know, 89 00:04:18.160 --> 00:04:20.160 just on our, on ourt here at Symmetry, 90 00:04:20.240 --> 00:04:23.360 I think the average advisory fee is somewhere around 97 basis points, 91 00:04:23.380 --> 00:04:24.280 if I'm not mistaken. 92 00:04:24.460 --> 00:04:29.120 And so we'll see advisors charge as little as maybe 60 or 50 basis points, 93 00:04:29.420 --> 00:04:34.280 and we'll see advisors charge, you know, as, as high as 125 basis points. 94 00:04:34.430 --> 00:04:37.760 It's hard to say what's right. It's, what it comes down to is, you know, 95 00:04:37.760 --> 00:04:39.960 your comfort level and what you're getting for those services. 96 00:04:40.350 --> 00:04:44.000 Some advisors will, uh, will charge, let's say lower basis points, 97 00:04:44.060 --> 00:04:47.120 but they'll also charge on top of that for other services, like, let's say, 98 00:04:47.120 --> 00:04:48.320 financial planning. Okay. 99 00:04:48.320 --> 00:04:52.680 Whereas some advisors will charge 125 basis points and let's say maybe financial 100 00:04:52.840 --> 00:04:56.040 planning's included in that. And so it's always good to know, you know, 101 00:04:56.260 --> 00:04:57.520 you know, not only what you're paying, 102 00:04:57.540 --> 00:05:00.960 but also what you're getting for that particular price or that fee that you're 103 00:05:00.960 --> 00:05:01.360 paying. Okay. 104 00:05:01.360 --> 00:05:03.920 So these are a couple things that I kind of want to dive into a little bit. 105 00:05:03.920 --> 00:05:05.840 First and foremost, I think, you know, 106 00:05:05.840 --> 00:05:10.360 it's not fair to talk about price and fees without talking about value, right? 107 00:05:10.360 --> 00:05:10.740 Right. 108 00:05:10.740 --> 00:05:15.600 And so I think that you are going to see varying degrees of fees across the 109 00:05:15.600 --> 00:05:18.600 board, depending on, on, on the advisor's value proposition, 110 00:05:19.180 --> 00:05:23.000 1% that we've seen that fee, that that really hasn't changed. Mm-hmm. Right? 111 00:05:23.000 --> 00:05:27.880 Mm-hmm. Um, we, we do hear a lot about price compression in the industry, but I, 112 00:05:27.880 --> 00:05:30.880 I think when it comes to the, the financial advisor's compensation, 113 00:05:30.940 --> 00:05:33.560 and I would argue that the financial advisor is the, uh, 114 00:05:33.560 --> 00:05:37.040 most valuable person in the value chain. Mm-hmm. That fee hasn't changed, 115 00:05:37.260 --> 00:05:40.800 but investors are looking more for, from their advisors. So there's some, 116 00:05:40.800 --> 00:05:42.520 there's some margin compression there, right? 117 00:05:42.790 --> 00:05:44.000 Yeah. The advisor, you know, uh, 118 00:05:44.000 --> 00:05:47.360 clients are becoming more savvy conversation around fees. It's, 119 00:05:47.360 --> 00:05:49.680 it's out in the open, right? You see 'em on commercials all the time, 120 00:05:49.870 --> 00:05:53.480 whether it's Schwab or Fidelity or Vanguard, you know, talking about, you know, 121 00:05:53.500 --> 00:05:57.720 low fees. So, uh, it's out there and clients are well aware of that. 122 00:05:58.180 --> 00:05:59.760 And so they're starting to ask questions, 123 00:05:59.760 --> 00:06:02.760 they're starting to ask what they're getting for, for that particular fee. 124 00:06:03.140 --> 00:06:05.040 But at the end of the day, you know, you know, it's, 125 00:06:05.040 --> 00:06:07.280 it's only an issue in the absence of value, you know, 126 00:06:07.280 --> 00:06:11.000 so if the advisor's providing value and they see that and they know that, then, 127 00:06:11.020 --> 00:06:12.000 you know, generally speaking, 128 00:06:12.000 --> 00:06:13.680 clients tend to be comfortable with what they're paying. 129 00:06:13.750 --> 00:06:17.800 Certainly, certainly. What are you, you know, the advisors that are charging 1%, 130 00:06:17.800 --> 00:06:21.960 what are the typical types of services that you see advisors performing for, 131 00:06:22.060 --> 00:06:24.120 for that fee to add value to the equation? 132 00:06:24.380 --> 00:06:26.560 That's a great question. You know, we, we kind of see, 133 00:06:26.980 --> 00:06:30.320 we see a lot of advisors that are rolling financial planning into their fee. 134 00:06:30.460 --> 00:06:32.600 You know, we, we, we see that there's, um, 135 00:06:32.600 --> 00:06:36.440 there's a lot of advisors that actually have a, a, um, what I would say, 136 00:06:36.480 --> 00:06:40.320 a very big financial planning focus. So they'll charge for financial plans, 137 00:06:40.540 --> 00:06:43.760 and they may do some advisory business along the way, uh, 138 00:06:43.760 --> 00:06:45.720 just to help out clients. And so they'll, you know, 139 00:06:45.720 --> 00:06:48.760 they may charge maybe a little less, maybe around 80 basis points, 140 00:06:48.760 --> 00:06:51.080 80 to 90 basis points, kind of what we're seeing there. 141 00:06:51.470 --> 00:06:53.040 Okay. That makes a lot of sense. I, I, 142 00:06:53.080 --> 00:06:56.120 I think that the value proposition for the advisors actually shifted quite a bit 143 00:06:56.120 --> 00:07:00.720 over the years. You know, you and I have talked, um, a lot about this and, 144 00:07:00.720 --> 00:07:01.000 you know, 145 00:07:01.000 --> 00:07:05.960 there was a time where the value proposition was thought to be returned. Mm-hmm. 146 00:07:06.470 --> 00:07:10.520 I'll pay you a higher fee for higher rates of return. And is that the case? No, 147 00:07:10.520 --> 00:07:10.720 because 148 00:07:10.720 --> 00:07:15.440 It's, you know, I, I think the, the juries, you know, come in, in terms of, 149 00:07:15.580 --> 00:07:19.160 of returns and in terms of what types of investments you should be in. I mean, 150 00:07:19.160 --> 00:07:19.720 right now, I mean, 151 00:07:19.720 --> 00:07:23.080 you're seeing huge outflows from going from what I would say traditional active 152 00:07:23.860 --> 00:07:28.080 to more traditional passive types of investing. And so I think the, the, 153 00:07:28.080 --> 00:07:32.000 the main role for the advisor is just really being that behavioral coach. Uh, 154 00:07:32.000 --> 00:07:33.880 when we're left to our own devices, we don't make, 155 00:07:33.900 --> 00:07:36.960 we necessarily don't make the best decisions, uh, when it comes to investing. 156 00:07:36.960 --> 00:07:41.040 We, we get very emotional about our, our money and when, when markets are down, 157 00:07:41.140 --> 00:07:43.600 we, we tend to hit, you know, hit the panic button and sell, 158 00:07:43.600 --> 00:07:46.760 and that's the wrong time to sell. And so, um, you know, when you look at the, 159 00:07:46.910 --> 00:07:51.000 like, industry studies that are out there, I mean, the vanguard's out, you know, 160 00:07:51.000 --> 00:07:53.440 advisor Alpha is a big one, shows that, you know, 161 00:07:53.440 --> 00:07:56.280 working with a financial advisor, you can, um, you know, 162 00:07:56.280 --> 00:08:00.840 capture about 300 basis points extra just by working with a financial advisor. 163 00:08:01.260 --> 00:08:02.760 And they actually attribute most of that to, 164 00:08:02.760 --> 00:08:04.920 but I think about half of that to behavioral coaching. Sure. 165 00:08:04.920 --> 00:08:07.160 And the, um, just for our listeners out there, 166 00:08:07.180 --> 00:08:10.480 the advisors Alpha study that was done by, uh, Vanguard, 167 00:08:10.560 --> 00:08:13.880 I believe it's a paper that they put out in conjunction with, 168 00:08:13.880 --> 00:08:15.120 with the Spectrum group. And, 169 00:08:15.120 --> 00:08:19.320 and it does show that investors who tend to work with financial advisors tend to 170 00:08:19.320 --> 00:08:20.400 have better performance, 171 00:08:20.460 --> 00:08:23.400 but it doesn't necessarily mean that the advisors tinkering with the portfolio. 172 00:08:23.500 --> 00:08:27.920 The value proposition, to your point, is coaching. It's competent, 173 00:08:27.920 --> 00:08:32.400 it's communication. It, it's, it's these things that help the investor, uh, 174 00:08:32.400 --> 00:08:34.520 whether the good times and the bad. And, and, 175 00:08:34.580 --> 00:08:37.240 and providing that sort of foundation, 176 00:08:37.270 --> 00:08:41.840 helping the investor stay the course really is the, the secret to, 177 00:08:41.900 --> 00:08:44.240 to having a successful investment experience. I 178 00:08:44.480 --> 00:08:47.240 Think it's also important to add that I think a lot of advisors now, you know, 179 00:08:47.240 --> 00:08:48.920 there is sort of a, a paradigm shift. 180 00:08:48.920 --> 00:08:52.720 It's not necessarily the returns that I can generate for you. Um, it's, 181 00:08:52.750 --> 00:08:55.240 it's the other things that I can do for you, um, 182 00:08:55.240 --> 00:08:58.360 because they know that they're not portfolio manager. Mm-hmm. You know, they're, 183 00:08:58.420 --> 00:08:59.040 you know, they're, 184 00:08:59.040 --> 00:09:01.840 they're running their own business and that business is helping people. 185 00:09:01.900 --> 00:09:04.560 And if they're spending all their time trying to figure out what the best stock 186 00:09:04.580 --> 00:09:07.320 is, they're, they're probably gonna miss the boat on, you know, 187 00:09:07.320 --> 00:09:09.600 helping their clients, you know, with their financial planning and, 188 00:09:09.600 --> 00:09:12.720 and meeting their, you know, their financial goals over time. Sure, 189 00:09:12.870 --> 00:09:16.000 Sure. So, you know, we talked a lot about the advisor compensation, 190 00:09:16.300 --> 00:09:19.720 and I kind of wanna revert back because, you know, the topic today is fees. 191 00:09:19.720 --> 00:09:21.520 Mm-hmm. It's not just advisory fees. 192 00:09:21.520 --> 00:09:24.040 There are a number of other fees associated with investing. 193 00:09:24.220 --> 00:09:27.040 You talked a little bit about the ahas, B shares and CS shares, 194 00:09:27.040 --> 00:09:29.520 which are typically sales charges for mutual funds, 195 00:09:29.520 --> 00:09:33.360 but there are no load mutual funds out there. There are. Correct. And, uh, 196 00:09:33.390 --> 00:09:36.680 what that means is there, there isn't a, a sales charge per se, 197 00:09:36.700 --> 00:09:39.080 but that doesn't mean that they're for free. Correct. Correct. 198 00:09:39.080 --> 00:09:40.000 Nothing's for free. 199 00:09:40.050 --> 00:09:40.860 Right. 200 00:09:40.860 --> 00:09:43.680 So talk to us a little bit about the costs that are associated with investing in 201 00:09:43.680 --> 00:09:47.160 something that, that, that no load or doesn't have a, a sales charge. Sure. 202 00:09:47.160 --> 00:09:47.280 Yeah. 203 00:09:47.280 --> 00:09:50.200 There's a couple costs to think about. You know, there's, I always refer to it, 204 00:09:50.200 --> 00:09:53.600 you know, the cost of investing, right? There's, there's gonna be, you know, 205 00:09:53.600 --> 00:09:56.280 some cost to, you know, running a portfolio. I mean, 206 00:09:56.280 --> 00:09:59.760 that's where your expense ratios come in, which is the really, it's the, 207 00:09:59.780 --> 00:10:02.760 the cost of running that particular, let's say, mutual fund if, 208 00:10:02.760 --> 00:10:05.680 whether it's a no load or, or a loaded mutual fund. I mean, 209 00:10:05.680 --> 00:10:09.040 those are things like, you know, trading costs, management fees, um, 210 00:10:09.040 --> 00:10:11.960 things of that nature. There's also, um, you know, 211 00:10:11.960 --> 00:10:14.760 custody fees that you have to think about, you know, what, uh, 212 00:10:14.760 --> 00:10:17.920 what custodian is gonna be housing those, those, um, 213 00:10:17.920 --> 00:10:21.160 those assets for you and what that pay structure looks like. I mean, we see, 214 00:10:21.620 --> 00:10:25.040 you know, uh, some custodians that'll do a flat, you know, flat rate fee, 215 00:10:25.260 --> 00:10:27.440 and we see some that'll have more of a tiered structure. 216 00:10:27.440 --> 00:10:30.720 So the more that you give them the, the lower that fee will come down. Again, 217 00:10:30.720 --> 00:10:32.320 there's, you know, certain services that are, 218 00:10:32.320 --> 00:10:35.640 that are provided by the custodian that you may seem are valuable. 219 00:10:35.700 --> 00:10:37.960 So maybe paying 15 basis points is worth it, 220 00:10:38.340 --> 00:10:41.760 and you may not see any value in that. And, and paying something like, you know, 221 00:10:41.760 --> 00:10:44.040 five or seven basis points maybe more, more suited. 222 00:10:44.040 --> 00:10:48.600 But those are all sort of what I would say in the category of just the cost of 223 00:10:48.600 --> 00:10:49.430 investing. 224 00:10:49.430 --> 00:10:52.600 Sure. Sure. And, and when you're looking at investment vehicles, 225 00:10:52.600 --> 00:10:54.280 mutual funds mm-hmm. ETFs, 226 00:10:54.770 --> 00:10:58.280 those expense ratios that comprise some of those costs, 227 00:10:58.750 --> 00:11:02.400 what are you seeing on average out there, and are those fees coming down? Uh, 228 00:11:02.400 --> 00:11:05.400 They are coming down, I pulled some numbers, you know, looking at just on, 229 00:11:05.420 --> 00:11:06.920 on averages, the, you know, 230 00:11:06.920 --> 00:11:09.440 the average expense ratio for a large cap mutual fund, 231 00:11:09.440 --> 00:11:13.640 about 86 basis points on the small cap side, it's averaging around, you know, 232 00:11:13.640 --> 00:11:17.360 1.4%. You know, so again, those are the averages. So you, 233 00:11:17.360 --> 00:11:19.880 you do see some mutual funds that can be as high as a, you know, 234 00:11:20.050 --> 00:11:22.600 north of a hundred and twenty five hundred thirty basis points. 235 00:11:22.660 --> 00:11:25.880 And then you can see some that are just a couple of basis points, you know, 236 00:11:25.880 --> 00:11:29.360 two basis points, five basis points for, you know, just a simple, uh, 237 00:11:29.490 --> 00:11:31.440 index tracking strategy. Okay. So 238 00:11:31.440 --> 00:11:34.160 You said a couple things there that I find interesting. First and foremost, uh, 239 00:11:34.500 --> 00:11:38.120 the asset class matters, right? Mm-hmm. Large cap versus small cap. 240 00:11:38.340 --> 00:11:41.680 And I think it would make sense that smaller cap stocks, 241 00:11:41.680 --> 00:11:46.200 smaller stocks are probably more costly to, to manage and maintain. 242 00:11:46.200 --> 00:11:47.240 So you'd expect higher expense 243 00:11:47.240 --> 00:11:49.880 Ratio, right? Yeah. And to trade 'em, it's harder to get access to 'em. 244 00:11:49.880 --> 00:11:52.120 Yeah. And we see the same thing in, in liquid alternatives. 245 00:11:52.120 --> 00:11:55.680 Like those alternative strategies tend to be a little pricey. Um, 246 00:11:57.340 --> 00:12:01.480 so the asset class matters. We are believers of global diversification, 247 00:12:01.540 --> 00:12:05.000 so having a little bit of all of those asset classes I think makes a lot of 248 00:12:05.000 --> 00:12:06.160 sense. Correct. Um, 249 00:12:06.260 --> 00:12:09.080 but you also mentioned something that I kind of want to dive into a little bit. 250 00:12:10.340 --> 00:12:14.840 You know, 86 basis points on average for large cap mutual fund. 251 00:12:15.300 --> 00:12:19.080 But you said you can get asset class exposures with index funds for just a 252 00:12:19.080 --> 00:12:23.240 couple of basis points, correct? Or hundredth of a percent. Mm-hmm. Why is that? 253 00:12:23.780 --> 00:12:25.480 Uh, I think it comes down to, you know, activity. 254 00:12:25.540 --> 00:12:28.480 The more active a strategy is you're, you're gonna see, you know, more turnover, 255 00:12:28.480 --> 00:12:30.520 that's more trading, and that's gonna, you know, 256 00:12:30.520 --> 00:12:33.840 cause the expense ratios to be a little bit higher than a more passive 257 00:12:33.840 --> 00:12:37.360 portfolio. Let's just, let's, let's just say tracking the s and p 500. 258 00:12:37.710 --> 00:12:38.100 Sure. 259 00:12:38.100 --> 00:12:42.960 So someone who is trying to attempt to outperform the s and p 260 00:12:42.960 --> 00:12:47.600 500 will do so by buying and selling Correct. Creating activity, 261 00:12:48.070 --> 00:12:51.400 raising costs, also taxes. Mm-hmm. 262 00:12:52.270 --> 00:12:56.280 Whereas simply buying and holding an index of the s and p 500, 263 00:12:56.310 --> 00:12:59.960 obviously is going to not only be less costly, but also more tax efficient. 264 00:12:59.960 --> 00:13:00.460 Correct. 265 00:13:00.460 --> 00:13:02.400 And it's also important to know what you're, what you're buying. 266 00:13:02.430 --> 00:13:05.520 There's a lot of people out there who, who believe in active management. 267 00:13:05.520 --> 00:13:06.400 They think that that, 268 00:13:06.400 --> 00:13:10.000 that there is alpha out there that a portfolio manager can provide, 269 00:13:10.500 --> 00:13:12.040 and in order to capture that alpha, 270 00:13:12.040 --> 00:13:15.240 they're willing to pay the extra expenses for that. So if you, 271 00:13:15.240 --> 00:13:18.520 if you know that going into it, then knowledge is king. Right? So, 272 00:13:18.660 --> 00:13:21.800 so you're okay with that. It's the people that don't understand that, 273 00:13:21.830 --> 00:13:24.760 that are in a portfolio, let's say a 401K plan, for example, 274 00:13:24.780 --> 00:13:26.360 you go into the menu, you, 275 00:13:26.510 --> 00:13:29.240 most people are probably gonna look at what their historical returns are, 276 00:13:29.240 --> 00:13:32.680 and they're gonna probably make a decision based off of past performance not 277 00:13:32.680 --> 00:13:35.320 knowing what, what's under the underlying securities or, 278 00:13:35.320 --> 00:13:38.240 or what the strategy is behind the individual mutual fund. 279 00:13:38.240 --> 00:13:39.320 And they could be paying, you know, 280 00:13:39.320 --> 00:13:42.480 higher fees and not knowing really what they're paying or why they're paying it. 281 00:13:42.550 --> 00:13:42.840 Yeah. 282 00:13:42.840 --> 00:13:44.880 And it, and it's important, right? At the end of the day, 283 00:13:45.390 --> 00:13:49.160 what you pay in fees comes off the top of what your return is. And over time, 284 00:13:49.160 --> 00:13:52.600 that can be substantial. We say lot on this podcast, you know, we, 285 00:13:52.620 --> 00:13:55.600 we can't control the markets, we can't control asset allocation, 286 00:13:55.740 --> 00:14:00.120 we can't control costs, and we can't control taxes. And we, we, 287 00:14:00.260 --> 00:14:04.600 we educate our listeners that, hey, focus on things you can control. Mm-hmm. 288 00:14:04.680 --> 00:14:08.120 Right? And so fees do matter at the end of the day. 289 00:14:08.380 --> 00:14:11.400 And I think there's been a lot of studies out there, if I'm not mistaken, 290 00:14:11.510 --> 00:14:13.880 Morningstar had one not too long ago that says, 291 00:14:14.060 --> 00:14:17.680 one of the key indicators of a mutual fund's performance is the expense ratio. 292 00:14:17.700 --> 00:14:20.640 The lower the fee, the greater likelihood it's gonna perform well. Yeah. Well 293 00:14:20.640 --> 00:14:22.800 Think about this. So in, in keeping with that, 294 00:14:22.900 --> 00:14:27.520 if you are in a mutual fund that has a 1% expense ratio and that mutual fund 295 00:14:27.520 --> 00:14:28.520 returned 5%, 296 00:14:28.580 --> 00:14:31.720 you're automatically giving up 20% and you're giving that back to the, 297 00:14:31.720 --> 00:14:32.840 to the fund company, right? 298 00:14:33.190 --> 00:14:34.720 501 is four. Exactly. 299 00:14:34.830 --> 00:14:37.400 Just, you know, basic math right there. Mm-hmm. So there, there, there is, 300 00:14:37.740 --> 00:14:40.040 you know, fees do matter and they do erode, you know, 301 00:14:40.040 --> 00:14:42.120 performance particularly over time. Uh, 302 00:14:42.120 --> 00:14:44.800 I got a couple other examples here I can share with you. You know, please just, 303 00:14:45.180 --> 00:14:46.600 you know, keeping things simple, you know, 304 00:14:46.600 --> 00:14:49.600 a hundred thousand dollars investment over 20 years, um, 305 00:14:49.880 --> 00:14:54.320 assuming a 6% rate of return in a mutual fund that has a 1% expense ratio, 306 00:14:54.340 --> 00:14:55.600 forget about, you know, custody, 307 00:14:55.780 --> 00:14:58.120 forget about advisory fees and all that other stuff, 308 00:14:58.150 --> 00:15:01.720 just straight up just investing in a one per, in a mutual fund that's, uh, 1%, 309 00:15:02.020 --> 00:15:04.200 uh, at the end of that 20 years, you know, you'll end up with a, 310 00:15:04.240 --> 00:15:08.680 a gross return of $320,713 and 55 cents. 311 00:15:08.830 --> 00:15:10.800 Take a look at the cost of fees. 312 00:15:10.800 --> 00:15:14.880 The cost of fees of that are actually $55 $383 and 78 cents. 313 00:15:14.880 --> 00:15:17.680 So you're gonna end up, uh, at the, in your account at the end of the day, 314 00:15:17.680 --> 00:15:18.640 after 20 years with, uh, 315 00:15:18.640 --> 00:15:23.120 $265,329 and 77 cents. 316 00:15:23.420 --> 00:15:26.240 And that's if you're invested in a, a, a mutual fund that has, you know, 317 00:15:26.240 --> 00:15:29.960 expense ratio 1%. And some people look at that and they say, that's great. 318 00:15:29.960 --> 00:15:32.680 That's that, that's a good return over 20 years. I'll take that. 319 00:15:32.870 --> 00:15:36.320 When you compare that, everything else being equal, but it's invested. Now in a, 320 00:15:36.320 --> 00:15:40.720 in a mutual fund that has an expense ratio of, uh, 25 basis points, again, 321 00:15:40.760 --> 00:15:44.640 a hundred thousand dollars over 20 years, 6% rate of return. The end of that, 322 00:15:44.640 --> 00:15:45.060 you, you, 323 00:15:45.060 --> 00:15:49.800 you still end up with the $320,713 55 cents, 324 00:15:49.900 --> 00:15:51.920 uh, on the gross end. But on the net, 325 00:15:51.920 --> 00:15:56.720 what you end up with is $305,919 and 75 cents. 326 00:15:57.420 --> 00:16:00.600 And so that's a cost, cost of fees there of 14, 327 00:16:00.620 --> 00:16:03.480 do $14,793 and 80 cents. 328 00:16:03.740 --> 00:16:07.000 So that's a significant difference ends up in your pocket. That's, 329 00:16:07.000 --> 00:16:08.440 That's, that's, that's massive. And we, 330 00:16:08.440 --> 00:16:12.120 we told our listeners there wouldn't be any math, but, uh, no, that, that, 331 00:16:12.120 --> 00:16:13.800 that is very true. But the thing is fees, 332 00:16:14.070 --> 00:16:16.480 it's part of investing like anything else. Mm-hmm. Right. They're, 333 00:16:16.480 --> 00:16:18.480 they're there. And I think it's important for investors to know, 334 00:16:18.820 --> 00:16:21.160 one of the things, uh, I read an article many years ago, 335 00:16:21.300 --> 00:16:25.720 and I think it's still prevalent and it's the notion of transparency, right? 336 00:16:25.780 --> 00:16:28.200 And, and, and what this article did, it was from, 337 00:16:28.310 --> 00:16:32.240 from State Street Global Advisors partnering with, uh, Wharton. 338 00:16:32.860 --> 00:16:37.120 And they interviewed a number of investors, um, about fees and, 339 00:16:37.140 --> 00:16:39.120 and their sentiments around fees. 340 00:16:40.100 --> 00:16:44.680 And what that study showed us was, it's not so much the, 341 00:16:44.700 --> 00:16:47.400 the level of the fee as they just wanted to know what it is. 342 00:16:48.300 --> 00:16:50.960 And why do you think there's such a lack of transparency with, 343 00:16:51.350 --> 00:16:53.200 with costs in this industry? 344 00:16:53.560 --> 00:16:55.960 I just think it's easy to, it's easy to bury. That's 345 00:16:55.960 --> 00:16:56.460 Unfortunate. 346 00:16:56.460 --> 00:16:58.360 You know, I think, and, and I think that's, that's, 347 00:16:58.380 --> 00:17:01.200 that's starting to change a little bit. I know we see it in our business, 348 00:17:01.420 --> 00:17:02.760 you know, and one of the things that, 349 00:17:02.760 --> 00:17:05.760 that we always kind of pride ourselves on are full transparency on fees, 350 00:17:06.260 --> 00:17:07.400 you know? But if you can look, 351 00:17:07.620 --> 00:17:09.760 if you can look less expensive than your competitor, 352 00:17:10.190 --> 00:17:13.680 then you feel that's gonna give you a competitive advantage. And so, you know, 353 00:17:13.740 --> 00:17:14.400 so it's, 354 00:17:14.400 --> 00:17:18.040 it's unfortunately I would say it's not uncommon for investment companies or 355 00:17:18.090 --> 00:17:20.080 other providers to, you know, kind of, you know, 356 00:17:20.280 --> 00:17:24.440 bury their fees or sort of hide them within, you know, the structure of their, 357 00:17:24.620 --> 00:17:26.320 of their, um, of their costs. 358 00:17:26.830 --> 00:17:30.360 Well, I think you, you said it best, right? In in, if there's value, 359 00:17:30.460 --> 00:17:33.560 the fees don't matter. Correct. Right. If you're getting what you're paying for. 360 00:17:34.020 --> 00:17:38.320 And so I think that there's a notion of a lot of advisors out there not wanting 361 00:17:38.320 --> 00:17:39.200 to talk about fees, 362 00:17:39.300 --> 00:17:42.800 cuz they might not be confident in their own value proposition. However, 363 00:17:43.130 --> 00:17:47.960 there are a lot of advisors that you and I work with on a daily basis that 364 00:17:48.190 --> 00:17:50.640 they're very upfront with what their cost structure is. 365 00:17:50.640 --> 00:17:53.800 They're very upfront with the fees are of the underlying investments, 366 00:17:54.300 --> 00:17:58.400 and they bring that transparent to the table because they have a very strong 367 00:17:58.400 --> 00:17:59.520 value proposition of their 368 00:17:59.520 --> 00:18:01.320 Clients. Yep. Yeah. They'll have it on their website, they'll have their, 369 00:18:01.320 --> 00:18:04.520 their fee, you know, their fee schedule on there along with, you know, the, 370 00:18:04.660 --> 00:18:07.240 the various services that they charge and, you know, 371 00:18:07.480 --> 00:18:10.320 whether you feel it's high or whether you feel it's low, at the end of the day, 372 00:18:10.320 --> 00:18:13.280 it's up to you to decide what's best for you. But at least you know, 373 00:18:13.280 --> 00:18:15.880 you have that full disclosure. Um, so you can make the, 374 00:18:15.880 --> 00:18:17.800 the best decision possible. Certainly, 375 00:18:17.800 --> 00:18:20.800 Certainly. So if, if our listeners are out there looking for a, 376 00:18:20.840 --> 00:18:22.080 a financial advisor, you know, 377 00:18:22.080 --> 00:18:24.680 some of the things that I'm hearing you say that they should be looking for is, 378 00:18:24.780 --> 00:18:29.480 is the advisor using a commission-based mo a commission-based model or a 379 00:18:29.480 --> 00:18:32.120 fee-based model? Mm-hmm. Are they, uh, 380 00:18:32.510 --> 00:18:36.080 transparent with their compensation and uh, 381 00:18:36.080 --> 00:18:38.560 are they transparent with their value proposition? Correct. Is, 382 00:18:38.560 --> 00:18:40.480 is there anything else that, that you would add to that? 383 00:18:40.740 --> 00:18:43.720 Um, just knowing what services you're gonna get. You know, I think, you know, 384 00:18:43.720 --> 00:18:45.120 time and time again, we, he, 385 00:18:45.180 --> 00:18:49.520 we hear stories that client felt that they were gonna get something from an 386 00:18:49.520 --> 00:18:50.200 advisor that they're, 387 00:18:50.200 --> 00:18:53.240 they're just not getting and they end up firing that advisor. You know, 388 00:18:53.260 --> 00:18:56.000 so knowing what you're gonna get from that advisor, and, and some advisors, 389 00:18:56.000 --> 00:18:58.720 again, they'll have this right on their website or they'll have it on that first 390 00:18:58.720 --> 00:19:01.720 consultation that they talk to. They'll tell you, Hey, look, you're gonna get, 391 00:19:01.720 --> 00:19:04.000 you know, four, you know, four meetings a year. 392 00:19:04.000 --> 00:19:07.120 You're gonna get six phone calls, you know, from me a year and, 393 00:19:07.120 --> 00:19:09.960 and here's my cell phone number. If there's ever an emergency for something, 394 00:19:09.960 --> 00:19:13.160 you know, give me a call. And then there's other advisors that'll say, you know, 395 00:19:13.160 --> 00:19:16.840 I'll meet you with you twice a year and we'll review your portfolio and if 396 00:19:16.840 --> 00:19:19.040 everything looks good, then we'll, I'll talk to you in six months. 397 00:19:19.540 --> 00:19:20.600 And if you're okay with that, 398 00:19:20.860 --> 00:19:24.080 and you at least you know that going into the relationship, I think where, 399 00:19:24.080 --> 00:19:25.360 where people get burned is they, 400 00:19:25.360 --> 00:19:28.440 they think they're gonna get more outta the relationship than they're getting. 401 00:19:28.700 --> 00:19:31.840 And a lot of times it's just slimy cuz of lack of transparency. 402 00:19:32.290 --> 00:19:34.120 Right. And I think that transparency is a, 403 00:19:34.360 --> 00:19:36.400 a tremendous way for advisors to build trust. 404 00:19:36.400 --> 00:19:38.440 Cause it's all based on trust at the beginning of the Absolutely. 405 00:19:38.440 --> 00:19:39.640 At the end of the day anyway, so Absolutely. 406 00:19:40.340 --> 00:19:41.800 And it's also important, Tom, 407 00:19:41.800 --> 00:19:44.720 to remember that as you're looking for a financial advisor, it's a, 408 00:19:45.100 --> 00:19:48.680 you think of it as a, a mutual interview. It's, it's, you know, they're, 409 00:19:48.680 --> 00:19:51.000 they're looking to see if you're gonna be a good client for them, 410 00:19:51.510 --> 00:19:54.000 just like you're looking to see if they're gonna be a good advisor for you. 411 00:19:54.340 --> 00:19:57.480 And so it's important that, that, uh, that a, your values are aligned. 412 00:19:57.550 --> 00:19:59.520 It's important to look for that full transparency, 413 00:19:59.700 --> 00:20:02.440 but it's also important that it's, you know, somebody that you can connect with. 414 00:20:02.810 --> 00:20:06.600 Absolutely. Absolutely. And, um, every investor's unique. Mm-hmm. 415 00:20:06.700 --> 00:20:09.640 And every advisor's unique in, in trying to find that match, 416 00:20:09.720 --> 00:20:12.800 I think is very important. So for our listeners out there, uh, 417 00:20:12.800 --> 00:20:14.720 those that might be looking for financial advisor, 418 00:20:14.720 --> 00:20:17.360 make sure that you're getting, uh, transparency into costs. 419 00:20:17.870 --> 00:20:20.400 Make sure you're getting transparency into value proposition. 420 00:20:20.790 --> 00:20:25.560 Make sure that you're using someone who is maybe not necessarily earning sales, 421 00:20:26.300 --> 00:20:30.880 uh, charges or sales commissions, uh, but actually giving fee for advice, 422 00:20:30.970 --> 00:20:34.840 which eliminates conflicts of interest. Um, and so I think that's, there's a, 423 00:20:34.840 --> 00:20:39.040 there's a lot there for our listeners to digest. JT, I want to thank you for, 424 00:20:39.100 --> 00:20:41.560 for joining us here today. It's been a pleasure talking to 425 00:20:41.560 --> 00:20:43.200 You. This has been a great time. We gotta do this more often. 426 00:20:43.250 --> 00:20:46.920 Absolutely. We'd love to have you back on the show. Uh, so in closing, 427 00:20:47.040 --> 00:20:50.800 I wanna thank the listeners for, for chiming into this, uh, podcast. And, uh, 428 00:20:50.800 --> 00:20:52.840 we'll get you at the next one. And, uh, 429 00:20:52.860 --> 00:20:56.480 for those of you who are looking for our, some of our previous episodes, uh, 430 00:20:56.480 --> 00:20:58.720 you can find them wherever you're currently finding your podcast. 431 00:20:58.940 --> 00:21:01.840 So thank you so much for your time and, uh, I'll see you at the next one. 432 00:21:01.960 --> 00:21:03.600 Symmetry Partners llc, 433 00:21:03.830 --> 00:21:07.760 it's an investment advisor firm registered with the Securities and Exchange 434 00:21:07.760 --> 00:21:08.580 Commission. 435 00:21:08.580 --> 00:21:13.280 The firm only transacts business in states where it is properly registered or 436 00:21:13.720 --> 00:21:16.760 excluded or exempted from registration requirements. 437 00:21:17.160 --> 00:21:21.720 Registration of an investment advisor does not imply any specific level of skill 438 00:21:21.740 --> 00:21:26.240 or training and does not constitute an endorsement of the firm by the 439 00:21:26.240 --> 00:21:26.940 commission. 440 00:21:26.940 --> 00:21:30.080 No one should assume that future performance of any specific investment, 441 00:21:30.290 --> 00:21:32.560 investment strategy, product, 442 00:21:33.060 --> 00:21:37.320 or non-investment related content made reference to directly or indirectly in 443 00:21:37.320 --> 00:21:41.670 this material will be profitable. As with any investment strategy, 444 00:21:41.920 --> 00:21:46.910 there is the possibility of profitability as well as loss due to various 445 00:21:46.910 --> 00:21:51.390 factors including changing market conditions and or applicable laws. 446 00:21:52.090 --> 00:21:56.430 The content may not be reflective of current opinions or positions. 447 00:21:56.770 --> 00:22:00.790 Please note the material is provided for educational and background use only. 448 00:22:01.110 --> 00:22:01.850 Moreover, 449 00:22:01.850 --> 00:22:05.790 you should not assume that any discussion or information contained in this 450 00:22:05.990 --> 00:22:09.990 material serves as the receipt of or as a substitute for 451 00:22:10.350 --> 00:22:12.390 personalized investment advice.  

Alternative Investments are not just "cool" or intriguing products to own. In truth, they have the potential to help you endure tumultuous markets. In this episode, we are joined once again by Philip McDonald, CFA, CAIA, Managing Director of Research Investments & Portfolio Manager, to discuss how Alternative Investments can mitigate risk in your portfolio. If you have any questions or would like more information, reach out to us at https://symmetrypartners.com/contact-us/ You can also find us on Facebook, YouTube, Twitter, and LinkedIn. As always, we remain invested in your goals. Symmetry Partners, LLC, is an investment advisory firm registered with the Securities and Exchange Commission. The firm only transacts business in states where it is properly registered, excluded or exempted from registration requirements. Registration of an investment adviser does not imply any specific level of skill or training and does not constitute an endorsement of the firm by the Commission. No one should assume that future performance of any specific investment, investment strategy, product or non-investment related content made reference to directly or indirectly in this material will be profitable. As with any investment strategy, there is the possibility of profitability as well as loss. Due to various factors, including changing market conditions and/or applicable laws, the content may not be reflective of current opinions or positions.   Please note the material is provided for educational and background use only. Moreover, you should not assume that any discussion or information contained in this material serves as the receipt of, or as a substitute for, personalized investment advice. 0 00:00:06.890 --> 00:00:09.120 Hello, this is Tom Romano with Unfiltered Finance. 1 00:00:09.270 --> 00:00:13.400 Welcome back to part two on our discussion of alternative investments here with 2 00:00:13.400 --> 00:00:14.360 us as Phil McDonald, 3 00:00:14.430 --> 00:00:18.720 portfolio Manager and managing Director of Investments at Symmetry Partners. 4 00:00:18.720 --> 00:00:19.760 Phil, welcome back. 5 00:00:20.020 --> 00:00:21.400 Thanks for having me back. Tom, 6 00:00:21.880 --> 00:00:24.880 I think we're getting a lot of questions from investors and and advisors because 7 00:00:24.880 --> 00:00:28.000 of the fact that you look at the performance of some of these alternative asset 8 00:00:28.000 --> 00:00:30.920 classes in a year like 2022. However, 9 00:00:31.640 --> 00:00:35.680 I think we would caution our listeners to, to not chase returns, 10 00:00:35.860 --> 00:00:40.040 and it's more of a strategic allocation that you wanna hold in your portfolio 11 00:00:40.140 --> 00:00:41.120 for a long duration. 12 00:00:41.600 --> 00:00:44.920 I would totally agree with that. And, and you have other considerations here, 13 00:00:44.920 --> 00:00:48.280 like broadly speaking, the expectation of the 60 40 portfolio, 14 00:00:48.300 --> 00:00:49.920 the return on the so-called 60 port, 15 00:00:49.930 --> 00:00:54.680 40 portfolio is likely going to be below average for in, in the near future. 16 00:00:54.780 --> 00:00:56.320 So you start to think about like, okay, 17 00:00:56.320 --> 00:01:00.200 my traditional portfolio isn't gonna return, you know, the 40 year average, 18 00:01:00.350 --> 00:01:03.080 what we saw decades ago. So where else might I be, 19 00:01:03.080 --> 00:01:06.280 might be able to go for returns and diversification? So you, 20 00:01:06.300 --> 00:01:10.440 you have that inflation surprises, you have increased correlation of, 21 00:01:10.460 --> 00:01:12.920 of traditional asset classes in the recent past. You know, 22 00:01:12.920 --> 00:01:16.360 of all these things kind of pointing to the benefit of having a diversified 23 00:01:16.710 --> 00:01:18.880 alternative strategy. And I would agree with you, 24 00:01:18.920 --> 00:01:22.280 I think you were alluding to the strength of 2022. It was, 25 00:01:22.300 --> 00:01:24.880 it was a very good year for certain alternative strategies. 26 00:01:25.000 --> 00:01:27.880 I would encourage people to think of that as an outlier year like that. 27 00:01:27.880 --> 00:01:31.280 That's not a year that can necessarily happen again unless all the bad things 28 00:01:31.280 --> 00:01:36.080 that happen in the equity and fixed income markets and with inflation kind of 29 00:01:36.490 --> 00:01:40.720 recur. So I, I would encourage people to almost think in terms of sharp ratio, 30 00:01:40.770 --> 00:01:43.600 right? So an excess return for a given volatility, 31 00:01:43.920 --> 00:01:47.320 a sharp ratio above 0.5, getting to maybe a 0.8, is, 32 00:01:47.340 --> 00:01:50.320 is the type of realm I think you should think of for, 33 00:01:50.380 --> 00:01:53.000 for a diversified alternative strategy. And, 34 00:01:53.180 --> 00:01:55.160 and to kind of put specifics on that, 35 00:01:55.380 --> 00:02:00.360 so something that has is managed to a 10% volatility or standard deviation that 36 00:02:00.360 --> 00:02:05.240 would be a five to 8% excess return on the risk-free rate. So, 37 00:02:05.660 --> 00:02:10.080 so you know, you're talking single digit excess returns for, uh, 38 00:02:10.200 --> 00:02:14.040 a strategy that's scaled to a 10% volatility. So, you know, 39 00:02:14.100 --> 00:02:16.480 to take people out of this expectation of, 40 00:02:16.780 --> 00:02:21.640 of a home run year kind of happening again, it's less likely to happen again. 41 00:02:21.660 --> 00:02:22.493 Gotcha. 42 00:02:22.900 --> 00:02:25.560 Um, just to clarify some of that, because I think that's some, 43 00:02:25.670 --> 00:02:28.880 some very important advice there. When we talk sharp ratio, 44 00:02:28.880 --> 00:02:32.000 the way I look at that is bang for your buck. Are you, 45 00:02:32.020 --> 00:02:35.960 are you getting the return for the risk that you are taking? 46 00:02:36.300 --> 00:02:37.720 And the higher the sharp ratio, 47 00:02:37.740 --> 00:02:39.800 the greater the return is for the risk that you're taking. 48 00:02:40.540 --> 00:02:44.800 And so when we're talking about, you know, years like 2022, which is an outlier, 49 00:02:44.810 --> 00:02:46.640 which I would agree, you know, 50 00:02:46.640 --> 00:02:51.640 investors could have alternatives in their portfolio for years with a trade off 51 00:02:51.640 --> 00:02:51.880 being, 52 00:02:51.880 --> 00:02:55.720 you might be getting single digit returns while the markets may be producing 53 00:02:55.720 --> 00:02:59.930 double digit returns. We don't know when the next 20, 22, 2 is gonna happen. 54 00:03:00.420 --> 00:03:05.280 But having an allocation of those alts will certainly help weather that storm. 55 00:03:05.820 --> 00:03:07.280 Uh, uh, totally agree. Yes. 56 00:03:07.380 --> 00:03:11.160 So I think a misconception here, and this is just from my conversations with, 57 00:03:11.160 --> 00:03:13.600 with advisors, investors alike, they think alternative strategies, 58 00:03:13.600 --> 00:03:15.000 they think returns. Mm-hmm. 59 00:03:15.080 --> 00:03:18.440 They think even tactical shifts into and hour. Exactly. Yeah. 60 00:03:18.460 --> 00:03:22.000 But what I'm hearing you say that this is more of a risk mitigating strategy 61 00:03:22.190 --> 00:03:24.000 than a return reaching strategy. 62 00:03:24.520 --> 00:03:28.080 I think it's, it's strongly risk mitigating from a diversification standpoint, 63 00:03:28.260 --> 00:03:30.320 but I'm not quite sure how 64 00:03:31.990 --> 00:03:34.760 Much you have to give up in returns. Okay. I mean, it, 65 00:03:34.880 --> 00:03:38.640 I I wouldn't necessarily say it, it's gonna hurt you over the long term. 66 00:03:38.760 --> 00:03:42.240 I think you need to think about the right portfolio you, you want to be in. And, 67 00:03:42.460 --> 00:03:46.000 you know, I dunno if you had a question here, but, uh, you know, there, 68 00:03:46.000 --> 00:03:50.200 there are some very specific use cases that I think make sense and that would be 69 00:03:50.520 --> 00:03:52.960 managing just the life cycle, 70 00:03:53.380 --> 00:03:58.280 how financial plans and asset allocations change as a person ages. Again, 71 00:03:58.380 --> 00:04:03.080 we, we have a finite kinda life here where we're earning and spending and maybe 72 00:04:03.080 --> 00:04:08.080 bequeathing and then preferences. So theoretically, as someone ages, 73 00:04:08.080 --> 00:04:11.640 they're the, the risk of their portfolio should, should come down over time. 74 00:04:11.640 --> 00:04:13.680 They're converting their human capital, 75 00:04:13.690 --> 00:04:17.200 their potential for earning during their career into financial capital. 76 00:04:17.200 --> 00:04:20.160 They're investing that hopefully they're being thoughtful about the 77 00:04:20.160 --> 00:04:23.760 diversification of, of, of those kind of two buckets and say, 78 00:04:23.760 --> 00:04:25.680 equity beta should come down as you age. 79 00:04:25.930 --> 00:04:28.080 Where do you go with that allocation in your portfolio? 80 00:04:28.640 --> 00:04:32.240 Historically and traditionally, someone would say, oh, fixed, fixed income, 81 00:04:32.240 --> 00:04:35.880 of course. But we've been seeing for a decade, you and I right, 82 00:04:35.930 --> 00:04:37.680 we're we're both nodding and smiling. 83 00:04:38.250 --> 00:04:43.120 There have been times when people were strongly opposed to increasing the fixed 84 00:04:43.120 --> 00:04:47.120 income allocation in their portfolio. So if it's just, you know, gas and break, 85 00:04:47.180 --> 00:04:49.360 you know, what do you do? You, you know, 86 00:04:49.360 --> 00:04:52.720 we've seen investors and advisors kind of freeze and, and say, oh, 87 00:04:52.720 --> 00:04:56.080 there's no solution here. But this third or fourth, right, 88 00:04:56.080 --> 00:05:00.560 with cash in the consideration bucket of allocation really opens things up. 89 00:05:00.620 --> 00:05:04.480 You can take down beta risk, uh, equity beta, 90 00:05:04.500 --> 00:05:09.000 and you can allocate and diversify not only into fixed income. 91 00:05:09.300 --> 00:05:10.100 Gotcha. 92 00:05:10.100 --> 00:05:13.640 And you, you know, we, I joke around saying it depends, right? We, 93 00:05:13.660 --> 00:05:18.080 we say that a lot here, um, because I also think it's a perfect portfolio. 94 00:05:18.340 --> 00:05:21.200 You know, we, we look at portfolios as being a series of trade offs. 95 00:05:21.580 --> 00:05:23.360 And so I immediately think, well gosh, you know, 96 00:05:23.360 --> 00:05:25.000 if you don't really give up any of the return, 97 00:05:25.000 --> 00:05:29.480 but you can definitely mitigate some of the risks through sharp ratio, 98 00:05:29.480 --> 00:05:32.920 as you said, like looking at that particular statistic, who, 99 00:05:32.920 --> 00:05:35.960 what are the trade-offs of, of investing in alternatives? And, 100 00:05:35.960 --> 00:05:38.920 and immediately I think, well, well, you're still, there's still cost, 101 00:05:39.030 --> 00:05:42.840 even though you can get lower cost alternative exposures, 102 00:05:42.840 --> 00:05:47.400 there's still a cost element to that. Um, and also, you know, 103 00:05:47.400 --> 00:05:50.320 we talk a lot about tracking error on the behavioral side, right? 104 00:05:50.380 --> 00:05:53.680 If you're gonna add an alternative asset class to your portfolio, 105 00:05:54.660 --> 00:05:58.080 but you're honed in on the s and p 500, you're, 106 00:05:58.080 --> 00:06:00.040 you're not gonna be tracking that index. 107 00:06:00.690 --> 00:06:01.220 Right? 108 00:06:01.220 --> 00:06:03.120 Is that, is that a correct way of thinking about it? 109 00:06:03.370 --> 00:06:04.040 Absolutely. 110 00:06:04.040 --> 00:06:07.600 And I'm glad you brought that up because not only are alternatives difficult to 111 00:06:07.600 --> 00:06:11.720 benchmark, there are some indices that I think, um, are, 112 00:06:11.740 --> 00:06:16.320 are relevant to a diversified, you know, conservative strategy. We, we, 113 00:06:17.220 --> 00:06:19.880 you know, we run an alternative strategy, uh, 114 00:06:19.880 --> 00:06:24.120 in different forms that is not seeking to, to be very volatile, right? 115 00:06:24.180 --> 00:06:28.040 So sub under that 10% volatility that I gave as, 116 00:06:28.180 --> 00:06:32.680 as the example to conceptualize a sharp ratio. So we, we, 117 00:06:32.740 --> 00:06:34.560 we don't even believe in a, uh, 118 00:06:34.560 --> 00:06:38.040 that high level of volatility in an alternative strategy. Um, 119 00:06:38.060 --> 00:06:39.280 but you raise a very good point. 120 00:06:39.300 --> 00:06:42.120 So not only are alternatives difficult to benchmark, 121 00:06:42.740 --> 00:06:44.880 but if you have alternatives in your portfolio, 122 00:06:45.860 --> 00:06:49.880 the appropriate benchmark for your portfolio should reflect 123 00:06:50.660 --> 00:06:55.480 the allocation you have. If it's 50% diversified equity, 124 00:06:56.770 --> 00:06:59.800 40% diversified fixed income, and 10% alts, 125 00:07:00.380 --> 00:07:04.880 you should probably benchmark yourself to a blended benchmark of a 126 00:07:04.880 --> 00:07:07.960 50, 40 10 mix of relevant indices. 127 00:07:08.540 --> 00:07:11.920 Not just look to the s and p 500, because again, 128 00:07:11.940 --> 00:07:14.440 you probably have a 0.5 beta in that portfolio. 129 00:07:14.980 --> 00:07:18.440 You don't want to compare yourself to something that is a 1.0 beta. 130 00:07:18.790 --> 00:07:22.880 Sure, sure. Absolutely. And you know, we, we talk a lot about, on this podcast, 131 00:07:23.480 --> 00:07:26.680 a lot of folks look at benchmarks to look at the performance, their portfolio, 132 00:07:26.740 --> 00:07:28.800 and I think that makes a lot of sense. But the true one, 133 00:07:28.800 --> 00:07:32.000 true benchmark is are you hitting your goals from a financial planning 134 00:07:32.000 --> 00:07:34.800 standpoint? Right? And so I think that's a better way to, to, 135 00:07:34.820 --> 00:07:38.640 to look at it versus just making sure that you may or may not be 136 00:07:38.990 --> 00:07:40.520 outperforming the s and p, 137 00:07:40.520 --> 00:07:44.400 which is a very visible benchmark out in the world today. 138 00:07:44.420 --> 00:07:47.560 And we can think the media outlets for that certainly. Right. 139 00:07:47.740 --> 00:07:50.680 So let's talk a little about, uh, allocation to alts, right? 140 00:07:50.680 --> 00:07:54.280 Let's say you have an investor, let's say it's 60% stock, 40% bond, 141 00:07:54.280 --> 00:07:58.400 maybe a small cash position in there. How should that investor consider adding, 142 00:07:58.820 --> 00:08:01.720 uh, alternatives to the portfolio? Is there a maximum amount you would put in? 143 00:08:01.740 --> 00:08:04.720 Is there a minimum amount? Would you take it from the stock side? 144 00:08:04.720 --> 00:08:07.440 Would you take it from the bond side? How does that work? And how should our, 145 00:08:07.460 --> 00:08:10.320 our listeners be conceptualizing adding that asset 146 00:08:10.320 --> 00:08:13.720 Class? So we, we have some opinions here, but I think in the end, it's, 147 00:08:13.720 --> 00:08:17.960 it's gonna be what is acceptable to the investor and what their financial 148 00:08:17.960 --> 00:08:22.520 advisors would recommend start the starting point matters. 149 00:08:22.900 --> 00:08:27.200 So if you're exceptionally conservative to start, say you're, 150 00:08:28.320 --> 00:08:31.980 you know, 10% equity in 90% fixed income, 151 00:08:32.260 --> 00:08:37.020 I think taking it ha having a a higher allocation alt might 152 00:08:37.450 --> 00:08:41.780 make more sense than if you were starting from the other end. So, uh, 153 00:08:41.840 --> 00:08:45.500 in terms of the distribution of returns and, and you know, 154 00:08:45.500 --> 00:08:47.980 the level of volatility of a diversified AL strategy, 155 00:08:48.250 --> 00:08:51.180 it's a little bit more similar to fixed income. It's, it's, 156 00:08:51.260 --> 00:08:54.540 I like to say those returns are fueled by different things. You know, it's not, 157 00:08:55.260 --> 00:08:59.200 you know, duration and credit risk and illiquidity type of stuff. 158 00:08:59.270 --> 00:09:02.840 It's other drivers that, that give you returns and alternatives. 159 00:09:02.860 --> 00:09:06.480 But our rules of thumb, which, you know, are for people to take or leave, 160 00:09:06.490 --> 00:09:11.000 would be maybe up to about 25% if you're starting from a very conservative, uh, 161 00:09:11.000 --> 00:09:14.800 portfolio. And if you're starting from a very aggressive portfolio, 162 00:09:14.830 --> 00:09:18.240 just say someone's a hundred percent equity invested in says, ah, 163 00:09:18.240 --> 00:09:22.160 I want to add malts to this portfolio, but I don't like fixed income. Um, 164 00:09:22.360 --> 00:09:23.480 I know a few of those, maybe, 165 00:09:24.210 --> 00:09:26.560 Maybe something more in the realm of 15%, 166 00:09:26.800 --> 00:09:31.560 I think lower than 10% allocation of anything to the portfolio is gonna have a, 167 00:09:32.120 --> 00:09:35.760 a, a limited effect on, on the outcome, right? 168 00:09:35.940 --> 00:09:40.200 So 10 percent's probably our general starting point to add something and, and, 169 00:09:40.260 --> 00:09:43.840 and see, uh, beneficial effect to the portfolio and, 170 00:09:43.980 --> 00:09:46.080 and where we've landed on where to fund it from. 171 00:09:46.080 --> 00:09:47.640 So I didn't forget that part of your question, 172 00:09:48.290 --> 00:09:52.560 where believers in prorata from the, 173 00:09:52.700 --> 00:09:53.720 the asset allocation, 174 00:09:54.260 --> 00:09:58.080 so if you're a 60 40 investor and you put say, 175 00:09:58.080 --> 00:09:59.560 20% alternatives, 176 00:10:00.010 --> 00:10:04.880 60% of that should be probably funded from a reduction in inequity 177 00:10:05.060 --> 00:10:07.960 and 40% from a reduction in fixed. And they go, again, 178 00:10:07.960 --> 00:10:12.320 these are starting rules of thumbs. I I am very familiar with people who, 179 00:10:12.910 --> 00:10:17.400 because that returns distribution to alts, you know, the volatility and the, 180 00:10:17.540 --> 00:10:22.520 and kind of the average return to the distribution to alts is a little 181 00:10:22.520 --> 00:10:24.520 more similar to fixed income than it is to equity. 182 00:10:24.760 --> 00:10:29.160 I know folks who want to take 100% on a fixed income, that is an approach, 183 00:10:29.420 --> 00:10:33.800 but if you think about that, you've done nothing to reduce your equity risk. 184 00:10:34.220 --> 00:10:37.920 So if someone is, again, aging life cycle is a consideration here, 185 00:10:38.760 --> 00:10:41.840 diversifying both systematic, traditional, 186 00:10:41.840 --> 00:10:43.600 systematic exposures of equity and fixed, 187 00:10:44.660 --> 00:10:48.160 we think taking from both makes a lot of sense to fund that ALT's position. 188 00:10:48.410 --> 00:10:50.640 There are exceptions, you know, there, there are, you know, 189 00:10:50.690 --> 00:10:54.560 there are people who have different savings or different, you know, 190 00:10:54.560 --> 00:10:58.880 sources of income, maybe people with three pensions, you know, like who, uh, 191 00:10:58.980 --> 00:11:02.280 who look a little different from an average investor. So again, 192 00:11:02.280 --> 00:11:04.840 individual specifics need to come into play, but those, 193 00:11:04.840 --> 00:11:07.720 those are my starting rules of thumb in a vacuum. 194 00:11:08.070 --> 00:11:09.160 Well, that makes a lot of sense, 195 00:11:09.160 --> 00:11:13.640 especially if you're looking at alternatives as a third leg to the stool, right. 196 00:11:13.660 --> 00:11:14.600 Stocks and bonds. 197 00:11:14.740 --> 00:11:18.160 And if the third category is going to be alternative asset classes or 198 00:11:18.160 --> 00:11:20.760 alternative strategies, it should come out prorata. 199 00:11:21.150 --> 00:11:24.160 It's not that the ALS are taking the place of equities or fixed income, 200 00:11:24.190 --> 00:11:26.880 it's something completely, completely different in the portfolio. 201 00:11:27.300 --> 00:11:28.133 Yep. 202 00:11:28.230 --> 00:11:32.480 Fantastic. So, um, Phil, I wanna thank you so much for your time. This is, uh, 203 00:11:32.500 --> 00:11:36.440 uh, super enlightening and just to kind of recap what we discussed, uh, 204 00:11:36.440 --> 00:11:38.000 for our listeners, um, 205 00:11:38.000 --> 00:11:42.040 alternative investments are a great way to diversify a portfolio beyond stocks, 206 00:11:42.280 --> 00:11:43.113 bonds, and cash. 207 00:11:43.690 --> 00:11:48.400 There are ways to get exposures to liquid alternative strategies through 208 00:11:48.670 --> 00:11:50.920 ETFs and mutual funds. With that should, 209 00:11:51.020 --> 00:11:54.920 you should expect a level of transparency to make sure you are getting those 210 00:11:54.920 --> 00:11:59.720 diversification benefits and, uh, certainly, uh, liquidity being a, 211 00:11:59.980 --> 00:12:04.240 uh, a factor there as well. And you know, whether or not alternatives are, 212 00:12:04.240 --> 00:12:07.560 are suitable for you, as we always say and unfiltered finance. You know, 213 00:12:07.560 --> 00:12:10.320 the best advice we can give is to always work with a financial advisor or 214 00:12:10.320 --> 00:12:14.760 financial professional that can take a look at your own personal situation, 215 00:12:15.060 --> 00:12:18.880 assess that situation, and, uh, make sure that they recommend, uh, 216 00:12:18.880 --> 00:12:21.520 an asset allocation, uh, that's suitable for you. 217 00:12:21.810 --> 00:12:24.520 Thank you listeners for joining us today. Uh, Phil, once again, 218 00:12:24.870 --> 00:12:27.760 it's always fun having you on the show. We'll certainly have you back. Great. 219 00:12:27.760 --> 00:12:28.593 Thanks for having me. 220 00:12:29.020 --> 00:12:31.160 For those of you who are looking for additional information, 221 00:12:31.160 --> 00:12:35.920 you can always visit our website@www.symmetrypartners.com. Feel free to, 222 00:12:36.340 --> 00:12:38.080 uh, listen to this podcast, uh, 223 00:12:38.090 --> 00:12:42.200 again or access any of our previous podcasts to the, uh, 224 00:12:42.330 --> 00:12:44.120 venue in which you get your podcasts. 225 00:12:44.460 --> 00:12:46.440 So thanks for listening and we'll catch you next time. 226 00:12:46.720 --> 00:12:48.360 Symmetry Partners, llc, 227 00:12:49.080 --> 00:12:52.600 an investment advisor firm registered with the Securities and Exchange 228 00:12:52.600 --> 00:12:53.420 Commission. 229 00:12:53.420 --> 00:12:58.120 The firm only transacts business in states where it is properly registered or 230 00:12:58.560 --> 00:13:01.600 excluded or exempted from registration requirements. 231 00:13:01.960 --> 00:13:06.480 Registration of an investment advisor does not imply any specific level of skill 232 00:13:06.480 --> 00:13:07.313 or training, 233 00:13:07.660 --> 00:13:11.480 and does not constitute an endorsement of the firm by the commission. 234 00:13:11.780 --> 00:13:14.920 No one should assume that future performance of any specific investment, 235 00:13:15.130 --> 00:13:17.400 investment strategy, product, 236 00:13:17.900 --> 00:13:22.120 or non-investment related content made reference to directly or indirectly in 237 00:13:22.120 --> 00:13:26.710 this material will be profitable. As with any investment strategy, 238 00:13:26.960 --> 00:13:31.750 there is the possibility of profitability as well as loss due to various 239 00:13:31.750 --> 00:13:36.230 factors including changing market conditions and or applicable laws. 240 00:13:36.930 --> 00:13:41.230 The content may not be reflective of current opinions or positions. 241 00:13:41.490 --> 00:13:45.870 Please note the material is provided for educational and background use only. 242 00:13:45.950 --> 00:13:46.690 Moreover, 243 00:13:46.690 --> 00:13:50.590 you should not assume that any discussion or information contained in this 244 00:13:50.830 --> 00:13:54.830 material serves as the receipt of or as a substitute for 245 00:13:55.190 --> 00:13:57.190 personalized investment advice.

Today, we talk about an area of the market that many people have heard of, but haven't chosen to invest in as of yet. Specifically, we're talking about “Alternative Investments” - investment strategies that are different from and diversifying to, traditional asset classes. In this first half of this two-part episode, our own Tom Romano is joined by Symmetry's Phil McDonald, CFA, CAIA, Managing Director of Research Investments & Portfolio Manager, to further define what “Alternative Investments” are, and why you may want to consider their potential benefits. If you have any questions or would like more information, reach out to us at https://symmetrypartners.com/contact-us/ You can also find us on Facebook, YouTube, Twitter, and LinkedIn. As always, we remain invested in your goals. Symmetry Partners, LLC, is an investment advisory firm registered with the Securities and Exchange Commission. The firm only transacts business in states where it is properly registered, excluded or exempted from registration requirements. Registration of an investment adviser does not imply any specific level of skill or training and does not constitute an endorsement of the firm by the Commission. No one should assume that future performance of any specific investment, investment strategy, product or non-investment related content made reference to directly or indirectly in this material will be profitable. As with any investment strategy, there is the possibility of profitability as well as loss. Due to various factors, including changing market conditions and/or applicable laws, the content may not be reflective of current opinions or positions.   Please note the material is provided for educational and background use only. Moreover, you should not assume that any discussion or information contained in this material serves as the receipt of, or as a substitute for, personalized investment advice.   Transcript 0 00:00:06.730 --> 00:00:10.400 Hello and welcome to Unfiltered Finance. This is your host, Tom Romano. 1 00:00:10.400 --> 00:00:12.160 Thank you for joining us. Uh, 2 00:00:12.160 --> 00:00:15.000 we have a special episode today where we want to talk about, uh, 3 00:00:15.000 --> 00:00:19.400 an area of the market that, uh, a lot of investors have probably heard of, uh, 4 00:00:19.620 --> 00:00:22.640 and probably most investors don't have a lot of exposure to. 5 00:00:23.180 --> 00:00:25.200 And that is alternative investments. 6 00:00:25.780 --> 00:00:29.200 And I have the perfect guest for us here today. Uh, Phil McDonald, 7 00:00:29.300 --> 00:00:33.040 who is a portfolio manager and the managing director of investments at Symmetry 8 00:00:33.040 --> 00:00:35.360 Partners, and is the resident expert on, 9 00:00:35.580 --> 00:00:39.360 on alternative investing here at Symmetry. So Phil, thanks for joining us today. 10 00:00:39.700 --> 00:00:41.280 Thanks for having me. I'm happy to be here. 11 00:00:41.900 --> 00:00:45.080 So I kinda wanna start very high level, Phil, um, 12 00:00:45.080 --> 00:00:49.200 because I think alternative investments is a, is a very, very broad topic. 13 00:00:49.400 --> 00:00:51.760 I mean, it can cover things, uh, 14 00:00:51.760 --> 00:00:55.760 such as precious metals to hedge fund strategies, um, 15 00:00:55.780 --> 00:00:59.760 all the way down to things like NFTs, right? Or, or even, you know, 16 00:00:59.760 --> 00:01:04.240 card collecting to an extent, right? So if you could just very high level give, 17 00:01:04.240 --> 00:01:08.520 give us a very broad definition, uh, on your view on alternative investing, 18 00:01:08.520 --> 00:01:09.020 please. 19 00:01:09.020 --> 00:01:09.720 And thank you that, 20 00:01:09.720 --> 00:01:14.680 that is a highly relevant question because alternatives is one of those labels 21 00:01:14.680 --> 00:01:17.760 and investing that doesn't have, uh, 22 00:01:17.880 --> 00:01:21.080 a perfectly agreed upon definition. I think, you know, 23 00:01:21.080 --> 00:01:24.640 certain people hear it and they think different things. Um, 24 00:01:24.800 --> 00:01:29.200 I think a useful definition to keep in mind is really, uh, 25 00:01:29.200 --> 00:01:33.080 the starting point is anything that is an investment strategy that is different 26 00:01:33.390 --> 00:01:37.800 from or diversifying to traditional asset classes that is 27 00:01:38.100 --> 00:01:41.080 equity and fixed income, right? Um, 28 00:01:41.180 --> 00:01:45.440 but I think you can't really stop there because, you know, 29 00:01:45.460 --> 00:01:48.840 you called attention to, to certain ideas that, you know, 30 00:01:48.840 --> 00:01:52.040 people might think of if, you know, you mentioned alternative investing, 31 00:01:52.320 --> 00:01:54.960 you know, baseball cards or, you know, 32 00:01:54.960 --> 00:01:58.520 a lot of interesting different artwork choices. Yeah. We've talked about, 33 00:01:58.520 --> 00:01:58.840 talked about 34 00:01:58.840 --> 00:01:59.270 That before. 35 00:01:59.270 --> 00:02:04.080 Cars, uh, timber farmland, you know, these are all, some, 36 00:02:04.320 --> 00:02:06.640 a lot of people think real estate, right? Which I think we could, 37 00:02:06.640 --> 00:02:07.600 we could debate that one, 38 00:02:07.700 --> 00:02:12.520 but I think not only should the investment strategy be different, but there, 39 00:02:12.530 --> 00:02:17.240 there should be kind of an economic rationale for why you might 40 00:02:17.510 --> 00:02:21.480 earn a return on that different strategy. And, and more specifically, 41 00:02:22.670 --> 00:02:27.560 where's the premium coming from? Right? So I think very quickly for me, 42 00:02:27.560 --> 00:02:31.600 that collapses down more to specific liquid, 43 00:02:32.380 --> 00:02:34.560 uh, investment in trading strategies. 44 00:02:34.950 --> 00:02:38.800 Sometimes based on themes we're al already familiar with in, 45 00:02:38.820 --> 00:02:40.640 in asset classes we're already familiar with. 46 00:02:40.640 --> 00:02:45.480 You don't necessarily have to go really far a field to find an 47 00:02:45.760 --> 00:02:49.480 addition to a portfolio that will, will make a difference in terms of, you know, 48 00:02:49.480 --> 00:02:51.920 adding an alternative, uh, investment exposure. 49 00:02:52.630 --> 00:02:55.560 Sure. Thank you for that. And, um, you know, 50 00:02:55.560 --> 00:02:58.680 I think it is that broad of a definition, right? I mean, uh, 51 00:02:58.990 --> 00:03:02.800 just to sort of clarify for, for our listeners, um, 52 00:03:02.860 --> 00:03:06.000 the word alternative means alternative, you said traditional asset classes, 53 00:03:06.460 --> 00:03:08.040 stocks, bonds. 54 00:03:08.610 --> 00:03:13.080 There is a correlation benefit to owning both stocks and bonds in a portfolio 55 00:03:13.270 --> 00:03:16.840 Most years. Most years. Yeah. We'll get to that. We will get to that. Um, 56 00:03:17.390 --> 00:03:20.640 however, um, you know, alternatives, to me it is a, 57 00:03:20.640 --> 00:03:25.280 it's a correlation story in, in all of those investments, if you will, 58 00:03:25.280 --> 00:03:30.200 whether it's cars, stamps, baseball cards, commodities, 59 00:03:30.670 --> 00:03:35.480 they are going to have or should have some sort of diversification benefit. 60 00:03:35.540 --> 00:03:37.000 And that's the purpose of it, right? 61 00:03:37.750 --> 00:03:39.200 Totally. You, you nailed it. 62 00:03:39.260 --> 00:03:44.120 The diversification benefit of an alternative strategy performing alternatively, 63 00:03:44.130 --> 00:03:46.480 right? So if you wanna get a little bit geeky, you know, 64 00:03:46.480 --> 00:03:50.160 you can think about something whose return stream looks different. So, you know, 65 00:03:50.220 --> 00:03:54.920 low correlation and expected return from that, you know, economic logic, 66 00:03:55.030 --> 00:03:58.760 that underlying fundamental theme as to if I do this trading strategy, 67 00:03:58.880 --> 00:04:03.760 I should expect a return, hopefully lower volatility than, than say, 68 00:04:03.920 --> 00:04:08.840 a equity market. So right there, you, you can talk about high sharp ratios or, 69 00:04:08.860 --> 00:04:12.560 you know, high excess returns relative to the volatility you're talking about. 70 00:04:12.780 --> 00:04:17.760 And, and absolutely diversification is the benefit. Very often, I, I, you know, 71 00:04:17.900 --> 00:04:21.520 use the, um, analogy of, you know, a third bucket of diversification. 72 00:04:21.540 --> 00:04:23.840 All you thought really all you had was two, well, 73 00:04:23.840 --> 00:04:27.760 there's this third bucket you might want to consider for some clients. And, 74 00:04:27.820 --> 00:04:31.240 and one, one thing I want to clarify here on, on this topic while we're here, 75 00:04:31.710 --> 00:04:35.040 most of these strategies are not a hedge, 76 00:04:35.500 --> 00:04:37.360 diversification is not a hedge. 77 00:04:37.820 --> 00:04:41.000 So if you're diversified with regard to, you know, 78 00:04:41.020 --> 00:04:45.600 equity markets and volatility, it doesn't mean when equities go down 10%, 79 00:04:45.780 --> 00:04:49.680 you go up 10%. It's not that directly, you know, 80 00:04:49.950 --> 00:04:53.360 inverse of a relationship. It's unrelated, you know, 81 00:04:53.360 --> 00:04:58.240 it's not sensitive to what the equity or fixed income market hopefully is doing. 82 00:04:58.420 --> 00:05:00.080 That's really what diversification is. 83 00:05:00.380 --> 00:05:03.360 So it's not the taking the, the counterpoint, if you will, right? 84 00:05:03.390 --> 00:05:08.240 Like something zigs this must zag, so to speak. Right? And so the idea is, it, 85 00:05:08.350 --> 00:05:13.240 it's not going to behave from a return standpoint like any other, 86 00:05:13.260 --> 00:05:17.080 it shouldn't behave like any other asset classes you currently have in your 87 00:05:17.080 --> 00:05:20.680 portfolio. And I really like the way you put that sort of a, a third bucket, 88 00:05:20.680 --> 00:05:24.640 right? I I maybe even a fourth, right? Because I think of cash. Yeah, exactly. 89 00:05:24.700 --> 00:05:29.160 So, so most investors have cash, bonds and stocks, 90 00:05:29.270 --> 00:05:31.120 most of their 401ks. And so what you're saying, 91 00:05:31.120 --> 00:05:35.200 there's this whole other realm of alternatives that can have 92 00:05:36.140 --> 00:05:40.880 diversification benefits because of the fact that they don't behave like stocks, 93 00:05:41.170 --> 00:05:43.120 bonds, and cash. Correct. 94 00:05:43.980 --> 00:05:48.880 So let's talk a little bit because I think alternatives sometimes get a bad 95 00:05:48.980 --> 00:05:52.120 rap. Um, I think a lot of it has to do with the, 96 00:05:52.260 --> 00:05:54.720 so maybe the broad definition has something to do with it, 97 00:05:54.780 --> 00:05:56.920 but let's just kind of pick it apart with some of the, 98 00:05:57.010 --> 00:06:00.920 the arguments I've heard from, uh, investors and financial advisors alike. 99 00:06:00.920 --> 00:06:03.400 And the first one that comes to mind is cost, right? You know, 100 00:06:03.400 --> 00:06:04.040 you think hedge funds, 101 00:06:04.040 --> 00:06:08.160 you think two 20 or three and 30 where you're the managers earning, you know, 102 00:06:08.180 --> 00:06:10.040 2%, 3% plus a, 103 00:06:10.160 --> 00:06:13.360 a large portion of the profits talk to us a little bit about cost with 104 00:06:13.360 --> 00:06:14.090 alternatives, 105 00:06:14.090 --> 00:06:17.920 Right? And that I think is a fair critique of, 106 00:06:18.320 --> 00:06:20.960 I dunno if I wanna call it a traditional model of alternative investing, 107 00:06:20.960 --> 00:06:24.320 maybe older model where some of this, these strategies started mm-hmm. 108 00:06:24.490 --> 00:06:26.840 Which really only offered in limited partnerships, 109 00:06:27.290 --> 00:06:29.760 which tend to have high minimums, you know, 110 00:06:29.760 --> 00:06:33.880 so only high net worth folks can qualify for them. They're illiquid. 111 00:06:34.180 --> 00:06:38.000 So capital could be tied up for something even up to 10 years opaque, 112 00:06:38.060 --> 00:06:41.880 you're not really sure what the manager is doing and, and expensive, you know, 113 00:06:41.880 --> 00:06:42.640 even, you know, 114 00:06:42.640 --> 00:06:46.240 sometimes you have like fund to funds and feeder funds and you have layers of 115 00:06:46.240 --> 00:06:49.440 fees, and then obviously those, those performance fees come into play as well. 116 00:06:50.180 --> 00:06:54.560 Um, so the good news is that that's not the only way to access alternative 117 00:06:54.560 --> 00:06:56.360 strategies. Now, you, 118 00:06:56.580 --> 00:07:00.720 the investor is able to invest in mutual funds and even ETFs that offer 119 00:07:00.950 --> 00:07:04.520 alternative strategies for the most part, liquid, transparent, you know, 120 00:07:04.520 --> 00:07:07.920 you get all the benefits of, you know, the regulatory requirements of, 121 00:07:07.940 --> 00:07:09.880 of being a fund in these structures. 122 00:07:10.580 --> 00:07:14.920 Not all strategies live well in that liquid structure. 123 00:07:15.380 --> 00:07:19.240 So, you know, you don't have quite literally that list of, you know, 124 00:07:19.240 --> 00:07:21.760 that funny list of all the things we could think of that someone might think of 125 00:07:21.760 --> 00:07:25.240 as, as a good investment. So you, you are more constrained, 126 00:07:25.300 --> 00:07:28.760 but still there's quite a bit to, to choose from. And then, you know, 127 00:07:28.760 --> 00:07:29.593 to your point, 128 00:07:29.710 --> 00:07:33.040 most of those strategies are just gonna have a very straightforward expense 129 00:07:33.170 --> 00:07:37.960 ratio on the fund. It'll be very clear what the investor has to pay on average. 130 00:07:38.340 --> 00:07:43.040 You typically see higher fees than, you know, a traditional say, 131 00:07:43.210 --> 00:07:47.320 index fund for equity or, or, or fixed income. But you, 132 00:07:47.320 --> 00:07:51.560 you're getting something different in, in a well-managed alternative strategy, 133 00:07:51.610 --> 00:07:54.280 Right? And you hit on a couple of of points there, right? 134 00:07:54.310 --> 00:07:57.040 Cost is something that always comes up. And uh, 135 00:07:57.200 --> 00:08:01.240 I understand that even in some of these ETF or mutual fund type vehicles, 136 00:08:01.270 --> 00:08:03.280 that there, there could be a higher layer of cost, 137 00:08:03.280 --> 00:08:08.160 but there are ways to get exposures to these asset classes without paying 138 00:08:08.580 --> 00:08:13.480 two and 20. Mm-hmm. Right. Um, you also mentioned liquidity, right? 139 00:08:13.600 --> 00:08:15.080 I think that gets solved for, 140 00:08:15.580 --> 00:08:18.680 if you're not using a limited partnership sort of vehicle. 141 00:08:19.300 --> 00:08:21.880 If you're using an etf, they're very, very liquid. 142 00:08:22.140 --> 00:08:24.520 So you can get your money whenever you may need it. 143 00:08:24.540 --> 00:08:27.800 But you also hit on something that I think is, I think, 144 00:08:27.800 --> 00:08:30.600 important to investors and it's transparency, right? 145 00:08:30.700 --> 00:08:32.880 The opacity of a hedge fund, traditional, 146 00:08:33.100 --> 00:08:37.360 if I can use the word traditional hedge fund tends to be a little bit, uh, 147 00:08:37.370 --> 00:08:41.280 black boxy, if you will, right? Right. And maybe investors are thinking of, 148 00:08:41.620 --> 00:08:44.160 you know, things like Bernie Madoff or things like that, right? 149 00:08:44.160 --> 00:08:45.800 Where you don't know what's going on under the hood, 150 00:08:45.940 --> 00:08:49.440 but an ETF or a mutual fund, 151 00:08:50.260 --> 00:08:54.760 an ETF specifically, you're gonna get a a lot of transparency in that. Correct? 152 00:08:55.030 --> 00:08:55.320 Yeah, 153 00:08:55.320 --> 00:08:55.900 Absolutely. 154 00:08:55.900 --> 00:08:57.080 So you know exactly what you're holding. 155 00:08:57.250 --> 00:09:00.720 Absolutely. And, and, uh, you've touched upon a point, 156 00:09:00.730 --> 00:09:03.560 which I think is very relevant, 157 00:09:03.660 --> 00:09:08.480 and thankfully there's been an evolution in the industry to kind of bring 158 00:09:08.480 --> 00:09:10.960 attention to some of that. So the, 159 00:09:11.100 --> 00:09:14.280 the idea of a global macro go anywhere, 160 00:09:14.410 --> 00:09:19.240 hedge fund a star manager who, you know, returned a thousand percent last year, 161 00:09:19.780 --> 00:09:23.640 you know, raising funds, just like in telling investors, I'm really smart. 162 00:09:23.820 --> 00:09:26.760 I'm smarter than all the rest. Invest with me. 163 00:09:26.790 --> 00:09:29.640 I'll find whatever the opportunity is globally, you know, 164 00:09:29.640 --> 00:09:32.240 regardless of country or region or asset class. Like, 165 00:09:32.360 --> 00:09:36.040 I will go find that opportunity and I will achieve a higher return. That, 166 00:09:36.740 --> 00:09:41.440 that's certainly something to probably be very careful of, right? He, 167 00:09:41.440 --> 00:09:44.920 he might wanna shy away from that. So over the last, I don't know, 168 00:09:44.920 --> 00:09:47.040 I'll say 25 years or so, there, 169 00:09:47.040 --> 00:09:49.840 there's been light kind of shown upon this idea that, you know, 170 00:09:49.840 --> 00:09:52.960 hedge funds don't hedge, you know, some hedge funds have a lot of beta, 171 00:09:52.990 --> 00:09:53.880 some hedge funds are, 172 00:09:54.020 --> 00:09:57.240 are implementing strategies you can get with liquid strategies. You know, 173 00:09:57.240 --> 00:10:00.920 this idea of hedge fund replication was, was an interesting arm of, uh, 174 00:10:00.920 --> 00:10:03.120 quantitative research. So I, I think for, 175 00:10:03.180 --> 00:10:07.000 for those who are interested and have the time as an alternative investor, you, 176 00:10:07.020 --> 00:10:10.880 you should be able to get from your manager a very specific explanation of 177 00:10:11.070 --> 00:10:13.800 exactly what's happening in the strategy, 178 00:10:14.980 --> 00:10:16.480 why it's an alternative strategy, 179 00:10:16.740 --> 00:10:19.440 why the fee being charged on that strategy makes sense, 180 00:10:19.660 --> 00:10:23.320 how it's diversifying to traditional asset classes. And really, I think at a, 181 00:10:23.320 --> 00:10:24.720 on a very basic level, 182 00:10:25.110 --> 00:10:30.040 confirm you're not paying alternative investment fees for 183 00:10:30.270 --> 00:10:32.120 just call it equity beta, right? 184 00:10:32.120 --> 00:10:36.080 Because we know equity beta is available in really high quality ETFs from 185 00:10:36.120 --> 00:10:38.840 Vanguard for probably three basis points. Yeah. 186 00:10:38.840 --> 00:10:42.880 I think that's a very important point, right? And, and we're firm believers on, 187 00:10:42.940 --> 00:10:47.440 on, on transparency. And if you're using alternatives correctly, 188 00:10:47.540 --> 00:10:49.000 if I'm understanding what you're saying, 189 00:10:49.260 --> 00:10:52.240 and it is a diversification play to ensure that you're getting that 190 00:10:52.240 --> 00:10:55.960 diversification, you need that level of transparency. And a lot of times, and, 191 00:10:55.960 --> 00:10:58.400 and we've read about this and talked about this in the past, 192 00:10:58.470 --> 00:11:02.200 sometimes these more opaque type strategies, you know, 193 00:11:02.200 --> 00:11:03.840 if equities are doing really, really well, 194 00:11:04.070 --> 00:11:07.920 they might be very correlated to equities at that very given point in time. 195 00:11:07.920 --> 00:11:12.400 And then the whole story of diversification kind of goes out the window, 196 00:11:12.400 --> 00:11:13.233 doesn't it? 197 00:11:13.240 --> 00:11:14.073 A hundred percent. 198 00:11:14.260 --> 00:11:19.200 And I think financial media hasn't helped in that education, right? 199 00:11:19.500 --> 00:11:23.920 So there's been stretches of time when equity markets were doing very well, 200 00:11:24.100 --> 00:11:27.800 and hedge funds haven't been, and, and you know, the storyline there is, 201 00:11:27.800 --> 00:11:31.280 you know, hedge funds failed. And well, if hedge fund, 202 00:11:31.500 --> 00:11:35.600 if a real alternative strategy has zero beta to the equity market and the equity 203 00:11:35.600 --> 00:11:36.920 equity market's doing well, 204 00:11:37.720 --> 00:11:42.280 I wouldn't necessarily expect to see those hedge funds up just because, 205 00:11:42.450 --> 00:11:43.640 Right? If, if the, 206 00:11:43.780 --> 00:11:47.480 if the alternative investment that you're using for diversification is zigging, 207 00:11:47.480 --> 00:11:49.240 while your equities are zigging, you 208 00:11:49.240 --> 00:11:50.280 Should ask questions. You should ask 209 00:11:50.440 --> 00:11:53.200 Questions. Absolutely. Absolutely. Well, let, 210 00:11:53.200 --> 00:11:56.000 let's talk a little bit about the performance, uh, of, 211 00:11:56.900 --> 00:11:59.720 of alternative investing in relation to portfolio. 212 00:11:59.860 --> 00:12:03.120 And you alluded to this in the beginning when, uh, you mentioned that, you know, 213 00:12:03.120 --> 00:12:07.880 sometimes stocks and bonds do behave alike. Mm-hmm. And we saw that in 2022, 214 00:12:07.880 --> 00:12:11.840 right? Yeah. Both had, uh, extremely volatile tough year, 215 00:12:12.350 --> 00:12:15.200 both ended up in, in the red. Um, 216 00:12:16.380 --> 00:12:18.360 how did alternatives do, or what, 217 00:12:18.360 --> 00:12:21.360 how did alternative asset classes perform during that timeframe? 218 00:12:21.860 --> 00:12:25.680 Uh, certain of them did reasonably well. So, uh, I'll, 219 00:12:25.680 --> 00:12:28.480 I'll maybe run through a few examples of, uh, 220 00:12:28.480 --> 00:12:31.900 strategies that are alternative. Uh, 221 00:12:31.900 --> 00:12:35.060 our diversified alternative investment approach would include. 222 00:12:35.280 --> 00:12:39.420 One of those is something called, uh, manage futures or trend following, or, 223 00:12:39.880 --> 00:12:43.500 you know, if you want to think about, you know, quantitative factor investing, 224 00:12:43.500 --> 00:12:48.020 which you know, is what we think about a lot, you can, you can consider that, 225 00:12:48.640 --> 00:12:51.660 um, longitudinal momentum or momentum over time. 226 00:12:51.920 --> 00:12:56.900 And this is really just a strategy that takes advantage of investing in futures 227 00:12:56.900 --> 00:13:00.660 and forwards. So derivatives that'll cover, you know, commodities, 228 00:13:00.760 --> 00:13:05.460 equity markets, fixed income markets. Uh, and in the simplest sense, 229 00:13:06.200 --> 00:13:10.100 if a trend in an asset class is up, 230 00:13:10.590 --> 00:13:14.900 especially over, you know, short, medium, and long-term time periods, 231 00:13:15.080 --> 00:13:18.580 the managed future strategy would essentially be long that exposure. 232 00:13:19.440 --> 00:13:22.380 And if a trend is down over, you know, 233 00:13:22.670 --> 00:13:27.500 short and long horizon managed future strategy would be short, uh, 234 00:13:27.500 --> 00:13:30.780 that asset class or commodity. So in 2022, 235 00:13:31.530 --> 00:13:35.100 when everything felt like it was going down and continuing down, 236 00:13:35.720 --> 00:13:39.820 the managed future strategy was able to reposition and be short, 237 00:13:40.290 --> 00:13:45.220 many of those strategies that were showing persistent negative price signals. 238 00:13:45.840 --> 00:13:49.580 So in 2022 a year when both equity and fixed income markets globally, 239 00:13:50.090 --> 00:13:51.900 generally speaking on a diversified basis, 240 00:13:52.010 --> 00:13:54.420 were down and very positively correlated, 241 00:13:54.730 --> 00:13:59.460 something like a managed future strategy was up, uh, strongly and, 242 00:13:59.460 --> 00:14:01.260 and very diversifying. That's 243 00:14:01.260 --> 00:14:01.740 Really interesting. 244 00:14:01.740 --> 00:14:06.740 And so would you'd have the same expectation if both stocks and bonds were 245 00:14:06.740 --> 00:14:09.580 up, that the mayor's future strategy might be down, or does it depend? 246 00:14:10.160 --> 00:14:10.993 It depends. 247 00:14:11.080 --> 00:14:14.900 So it depends on the strength of those signals and the persistence of those 248 00:14:14.900 --> 00:14:19.100 trends. So in, in certain stable, neutral, slow, 249 00:14:20.090 --> 00:14:24.900 generally up markets, those signals may be too choppy to, to make use of. 250 00:14:25.160 --> 00:14:28.940 And maybe if there's conflicting signals, say, you know, 251 00:14:29.560 --> 00:14:32.900 up in the short term, down strongly in the medium term, 252 00:14:33.000 --> 00:14:35.460 up slightly in the long term, you know, 253 00:14:35.460 --> 00:14:38.020 you can't always make sense of those quantitative signals and, 254 00:14:38.020 --> 00:14:42.260 and you might have no exposure in that type of underlying market or commodity or 255 00:14:42.260 --> 00:14:43.000 asset class. 256 00:14:43.000 --> 00:14:46.540 So that'll conclude part one of our, uh, conversation alternative investments. 257 00:14:46.610 --> 00:14:49.300 Phil, thanks for joining us. And for our listeners, uh, 258 00:14:49.300 --> 00:14:50.900 if you're looking for additional information, 259 00:14:51.160 --> 00:14:54.920 please feel free to visit our website, www.symmetrypartners.com, 260 00:14:55.260 --> 00:14:58.400 and to access more of the Unfiltered Finance podcasts. 261 00:14:58.580 --> 00:15:01.800 Please feel free to find us wherever you're getting your podcast today. 262 00:15:02.020 --> 00:15:03.480 Be sure to stay tuned for part two. 263 00:15:03.840 --> 00:15:08.320 Symmetry Partners LLC is an investment advisor firm registered with the 264 00:15:08.320 --> 00:15:10.080 Securities and Exchange Commission. 265 00:15:10.420 --> 00:15:15.120 The firm only transacts business in states where it is properly registered or 266 00:15:15.560 --> 00:15:18.600 excluded or exempted from registration requirements. 267 00:15:19.040 --> 00:15:23.680 Registration of an investment advisor does not imply any specific level of skill 268 00:15:23.700 --> 00:15:24.533 or training, 269 00:15:24.660 --> 00:15:28.520 and does not constitute an endorsement of the firm by the commission. 270 00:15:28.860 --> 00:15:32.000 No one should assume that future performance of any specific investment, 271 00:15:32.210 --> 00:15:34.480 investment strategy, product, 272 00:15:34.980 --> 00:15:39.240 or non-investment related content made reference to directly or indirectly in 273 00:15:39.240 --> 00:15:43.690 this material will be profitable. As with any investment strategy, 274 00:15:43.940 --> 00:15:48.890 there is the possibility of profitability as well as loss due to various 275 00:15:48.890 --> 00:15:53.370 factors including changing market conditions and or applicable laws. 276 00:15:54.070 --> 00:15:58.450 The content may not be reflective of current opinions or positions. 277 00:15:58.790 --> 00:16:02.890 Please note the material is provided for educational and background use only. 278 00:16:02.970 --> 00:16:03.670 Moreover, 279 00:16:03.670 --> 00:16:07.810 you should not assume that any discussion or information contained in this 280 00:16:08.010 --> 00:16:12.050 material serves as the receipt of or as a substitute for 281 00:16:12.370 --> 00:16:14.490 personalized investment advice.  

Stories of historically atypical interest rate hikes, and multiple bank failures, concerned many advisors in the early days of 2023. Join us for the second (and final) part of our discussion with Casey Dylan, CIMA®, Consultant, and the host of Unfiltered Finance, Tom Romano, Head of Strategic Relationships, as we discuss some of the more prominent news events, and their effects, during Q1 of this year. If you have any questions or would like more information, reach out to us at https://symmetrypartners.com/contact-us/ You can also find us on Facebook, YouTube, Twitter, and LinkedIn. As always, we remain invested in your goals. Symmetry Partners, LLC, is an investment advisory firm registered with the Securities and Exchange Commission. The firm only transacts business in states where it is properly registered, excluded or exempted from registration requirements. Registration of an investment adviser does not imply any specific level of skill or training and does not constitute an endorsement of the firm by the Commission. No one should assume that future performance of any specific investment, investment strategy, product or non-investment related content made reference to directly or indirectly in this material will be profitable. As with any investment strategy, there is the possibility of profitability as well as loss. Due to various factors, including changing market conditions and/or applicable laws, the content may not be reflective of current opinions or positions.   Please note the material is provided for educational and background use only. Moreover, you should not assume that any discussion or information contained in this material serves as the receipt of, or as a substitute for, personalized investment advice. Transcript: 0 00:00:01.900 --> 00:00:07.800 Let's let's 1 00:00:07.600 --> 00:00:10.600 shift a little bit to some of the headlines that we saw because there was 2 00:00:10.600 --> 00:00:15.100 there's quite a bit. It felt like it was a very long quarter. Yeah, and you 3 00:00:14.200 --> 00:00:17.700 know as we did see some positive results, but can we 4 00:00:17.600 --> 00:00:21.300 talk a little bit about just in general some of the headlines that we saw and 5 00:00:20.600 --> 00:00:25.000 then specifically I want to take a dive into inflation 6 00:00:23.600 --> 00:00:26.700 and then the banks because that was 7 00:00:26.700 --> 00:00:30.200 a really big headline. We got a lot of a lot of calls regarding that look 8 00:00:29.800 --> 00:00:31.200 there there were 9 00:00:33.300 --> 00:00:35.900 Striking headlines around things like 10 00:00:36.800 --> 00:00:40.800 shocks to sort of economic surprises on 11 00:00:42.000 --> 00:00:45.300 job numbers to what was going on with the FED 12 00:00:45.100 --> 00:00:48.400 to Banks not just near the United States but 13 00:00:48.100 --> 00:00:51.600 internationally and yet what you see is kind 14 00:00:51.400 --> 00:00:55.000 of, you know markets do what they do in in any given day. They respond 15 00:00:54.600 --> 00:00:57.900 to that but they are quick to incorporate the news 16 00:00:57.600 --> 00:01:01.300 and get back to pricing on other kinds of things. And 17 00:01:00.600 --> 00:01:05.200 so I would say as a micro dosage of 18 00:01:04.600 --> 00:01:08.400 what the ride is for investors. It's 19 00:01:07.800 --> 00:01:11.000 this it's if you can sort of 20 00:01:11.000 --> 00:01:14.400 take in stride that there are going to be lots of headlines and 21 00:01:14.100 --> 00:01:17.500 that there may be short-term Market reactions headlines over the 22 00:01:17.400 --> 00:01:21.000 longer term that kind of gets filtered out on 23 00:01:20.400 --> 00:01:23.700 the upside and downside right and what you get back 24 00:01:23.400 --> 00:01:26.600 to is. Hey one of my paying for right I'm paying for some kind 25 00:01:26.500 --> 00:01:30.100 of future earnings or I'm lending with some expectation that 26 00:01:29.800 --> 00:01:33.800 I'm going to get paid and income stream based on that and that tends 27 00:01:33.000 --> 00:01:36.700 to drown out the short term noise and now 28 00:01:36.400 --> 00:01:40.200 you're back to factors of how much did I pay did I 29 00:01:40.100 --> 00:01:41.700 get my earnings did I not is 30 00:01:42.000 --> 00:01:45.600 We're upside to that right and markets are kind of a weighing machine 31 00:01:45.500 --> 00:01:48.900 in that sense. Right? They're weighing those earnings. They're weighing those 32 00:01:48.900 --> 00:01:52.200 cash flows in the future. Right? So I would say 33 00:01:52.000 --> 00:01:55.900 lots of lots of news lots of scurrying 34 00:01:55.000 --> 00:01:56.300 around the news. 35 00:01:57.100 --> 00:02:01.000 You know at the end of the day we're sort of where we started one 36 00:02:00.100 --> 00:02:03.200 of the headlines and one of the things that we've been getting a lot 37 00:02:03.200 --> 00:02:06.300 of questions about I'm talking about is is inflation. I know we've spent some time 38 00:02:06.200 --> 00:02:09.600 already today talking about that. We did 39 00:02:09.400 --> 00:02:13.500 see US inflation ease a little bit but there 40 00:02:13.100 --> 00:02:16.300 might be some pressures coming up. So if you don't mind commenting on that, that 41 00:02:16.100 --> 00:02:19.200 would be great. Yeah, you bet. I think it's helpful to kind of 42 00:02:19.200 --> 00:02:21.200 take a step back and look at 43 00:02:22.200 --> 00:02:25.700 With the onset of the pandemic right everything kind 44 00:02:25.400 --> 00:02:28.800 of shut down and then when we went to reopen things back up 45 00:02:28.600 --> 00:02:32.000 factories didn't necessarily open up, especially in 46 00:02:31.900 --> 00:02:36.600 places like China right for some time. Right and the the 47 00:02:35.300 --> 00:02:39.700 supply chain was suddenly 48 00:02:38.300 --> 00:02:41.500 constrained and so we 49 00:02:41.300 --> 00:02:44.300 had a hard time getting Goods, right but there was a lot 50 00:02:44.300 --> 00:02:48.400 of demand because we were at home, you know person stuff and so 51 00:02:48.200 --> 00:02:51.700 as you have demand shoot up but supplies constrained 52 00:02:51.200 --> 00:02:54.500 price shoots up, right? That's just sort of Economics 101 53 00:02:54.200 --> 00:02:57.400 and we saw that and at the time, you know, the Fed was quick 54 00:02:57.200 --> 00:03:00.500 to say, hey, look we think this is transitory think eventually things 55 00:03:00.200 --> 00:03:03.700 settle down we get manufacturing back online. We work 56 00:03:03.400 --> 00:03:06.700 out the bugaboos associated with the supply chain 57 00:03:06.500 --> 00:03:09.600 and those the price pressure doesn't inflationary pressure should come back 58 00:03:09.500 --> 00:03:13.100 down over time and in large respect 59 00:03:12.800 --> 00:03:16.500 this seems to have proven that out right? 60 00:03:15.800 --> 00:03:19.100 I think what really got the fed's 61 00:03:18.800 --> 00:03:21.800 attention and started them down the path. 62 00:03:22.200 --> 00:03:26.100 Of really dramatically raising rates was 63 00:03:25.400 --> 00:03:28.700 the fact that well while goods were 64 00:03:28.500 --> 00:03:31.800 sort of starting to come back down. It was 65 00:03:31.600 --> 00:03:34.900 inflation associated with services that was going up. And 66 00:03:34.600 --> 00:03:37.800 in fact, what we've seen is good coming down 67 00:03:37.600 --> 00:03:40.700 the the overall inflation of 68 00:03:40.600 --> 00:03:44.500 the CPI number or that PC number coming down from its 69 00:03:44.100 --> 00:03:48.100 highs last summer, but while that's been happening underneath 70 00:03:48.900 --> 00:03:52.300 Inflation associated with Services has continued to 71 00:03:52.100 --> 00:03:52.600 go up. 72 00:03:53.200 --> 00:03:56.500 And so even if we're at a point now where the latest inflationary readings 73 00:03:56.200 --> 00:03:58.100 are half of what they were. 74 00:03:58.900 --> 00:04:00.400 Just a year ago this time. 75 00:04:01.600 --> 00:04:05.500 Services inflation is up and continuing to go the wrong direction. Right? And 76 00:04:05.200 --> 00:04:08.400 so the the FED has said hey, look 77 00:04:08.200 --> 00:04:11.400 first of all, we don't look at kind of the overall CPI number. We don't 78 00:04:11.300 --> 00:04:15.500 that's not how we measure it. We're looking at these underlying statuents and 79 00:04:14.900 --> 00:04:18.600 they prefer the the pce as 80 00:04:18.200 --> 00:04:21.300 opposed to CPI, but they're all just kind of ways of measuring, you know 81 00:04:21.300 --> 00:04:24.900 inflation in the economy. And so 82 00:04:24.400 --> 00:04:27.400 one of the ways that we've looked at 83 00:04:27.400 --> 00:04:30.600 this for a very long time is core CPI, right? We're stripping out the 84 00:04:30.400 --> 00:04:34.100 volatility of energy and food because those tend to move around so much and then 85 00:04:33.900 --> 00:04:37.300 you know, we've been introduced to this concept that not 86 00:04:37.000 --> 00:04:40.500 only is it core CPI, but it's core Goods CPI and 87 00:04:40.200 --> 00:04:44.100 course Services CPI. And so the FED now is very focused 88 00:04:43.600 --> 00:04:48.000 on core Services looking at Services minus 89 00:04:47.000 --> 00:04:50.400 services for energy and food and what 90 00:04:50.100 --> 00:04:54.000 we see are again our sort of troubling Trends 91 00:04:53.100 --> 00:04:56.500 around services and housing 92 00:04:56.100 --> 00:04:59.400 in terms of the impact that that 93 00:04:59.200 --> 00:05:01.400 has now pushing. 94 00:05:01.600 --> 00:05:04.700 Up or holding up those inflation numbers and if they 95 00:05:04.600 --> 00:05:08.100 continue on the wrong direction, that's what the fed's concern about and the 96 00:05:07.600 --> 00:05:11.500 the whammy that potentially comes 97 00:05:10.600 --> 00:05:13.900 from if Services costs go 98 00:05:13.700 --> 00:05:16.800 up at some point that starts to impact Goods costs as 99 00:05:16.700 --> 00:05:20.600 well. Right? And so if you look at this where the the white 100 00:05:19.800 --> 00:05:23.200 bars are coming down, right the the concern 101 00:05:22.800 --> 00:05:26.400 is that Services cost the cost of producing goods 102 00:05:25.800 --> 00:05:29.200 and delivering them right is going to impact the the cost 103 00:05:29.000 --> 00:05:32.500 that gets passed through and goods start to come back up and there's sort 104 00:05:32.100 --> 00:05:35.500 of a double double impact of inflation if 105 00:05:35.400 --> 00:05:38.700 you will and that's what I think the FED is incredibly concerned about 106 00:05:38.500 --> 00:05:41.600 and and why they say look we're gonna ratchet rates up 107 00:05:41.600 --> 00:05:45.700 and we're gonna keep them up there long enough until we're convinced that we've we've 108 00:05:44.800 --> 00:05:48.000 stamped this out and brought it back down to a level that's 109 00:05:47.800 --> 00:05:51.000 livable because the last thing you want to do is take your foot off the pedal. 110 00:05:51.800 --> 00:05:55.300 And then suddenly have a Resurgence of these 111 00:05:55.000 --> 00:05:58.300 inflation Air Forces which that we've saw 112 00:05:58.000 --> 00:06:01.400 in the 70s, right if you think about what we've we've 113 00:06:01.200 --> 00:06:04.800 seen this show before the early 70s the FED raising 114 00:06:04.500 --> 00:06:08.400 rates taking their their foot off the brake, I guess and then 115 00:06:08.000 --> 00:06:11.900 Resurgence of inflation in the late 70s stagflationary 116 00:06:11.200 --> 00:06:14.500 environment and it took the volcker FED in the 80s 117 00:06:14.200 --> 00:06:17.800 taken rates to places. We'd never seen until recently right to 118 00:06:17.400 --> 00:06:20.700 to stamp that out. And so I think the FED 119 00:06:20.500 --> 00:06:24.000 is taking a lesson from history and said we don't want to repeat those mistakes. 120 00:06:23.600 --> 00:06:27.000 We're gonna stay on this until we're sure right absolutely and 121 00:06:26.600 --> 00:06:30.200 speaking of the fed and it says been a very fast pace 122 00:06:29.600 --> 00:06:32.800 in terms of Ray hikes. Yeah 123 00:06:32.600 --> 00:06:36.200 historically exactly exactly so 124 00:06:35.800 --> 00:06:40.400 they they have meant business and I 125 00:06:39.500 --> 00:06:44.100 think Market participants repeatedly made 126 00:06:43.200 --> 00:06:47.000 the mistake of not taking 127 00:06:46.700 --> 00:06:48.200 the FED at its word. 128 00:06:48.700 --> 00:06:51.900 Right and and equities markets have 129 00:06:51.700 --> 00:06:54.900 definitely gotten well ahead of the FED particularly at 130 00:06:54.700 --> 00:06:58.600 the end of last year and maybe potentially the beginning of this year bond markets 131 00:06:58.200 --> 00:07:01.500 now are pricing that the FED 132 00:07:01.200 --> 00:07:05.000 will pull back and yet the FED is saying no. No, we're we're 133 00:07:04.600 --> 00:07:08.600 gonna raise rates and we're gonna keep them there longer and that's 134 00:07:07.600 --> 00:07:10.900 you know, we have no expectation that we would 135 00:07:10.800 --> 00:07:14.300 pull back from that anytime this year. Right? So the market 136 00:07:13.800 --> 00:07:17.000 participants are our forward looking forward pricing, but 137 00:07:16.900 --> 00:07:20.500 they seem to not be taking the FED at its word. I think that's pulled 138 00:07:20.100 --> 00:07:23.800 back a little bit in February and March we started to 139 00:07:23.500 --> 00:07:25.400 see Market participants kind of get their arms around. 140 00:07:26.300 --> 00:07:29.400 Actually be coming and we see you know 141 00:07:29.400 --> 00:07:33.400 investors like hedge funds really sort of looking at volatility 142 00:07:32.400 --> 00:07:36.000 Bets with the expectation that hey this 143 00:07:35.600 --> 00:07:39.300 may get a little more turbulent before it gets better. Right? So 144 00:07:39.000 --> 00:07:44.200 there's a lot of sort of now Market positioning 145 00:07:43.200 --> 00:07:46.500 for the fed me 146 00:07:46.300 --> 00:07:49.800 actually do this and we may see an economic pullback, 147 00:07:49.300 --> 00:07:52.800 but that may not necessarily mean the FED response to 148 00:07:52.800 --> 00:07:56.500 it. Right? I think again as we look forward the 149 00:07:55.900 --> 00:08:00.100 the way that I would think about this as an investor as a the 150 00:07:59.200 --> 00:08:03.000 stock market is not the economy, right? The 151 00:08:02.400 --> 00:08:06.200 markets are definitely driven by 152 00:08:05.700 --> 00:08:09.400 interest rates and fed movement 153 00:08:09.000 --> 00:08:10.200 and yet 154 00:08:12.500 --> 00:08:16.400 Much like headlines the markets take that 155 00:08:16.200 --> 00:08:20.200 news and stride it gets built into prices and there 156 00:08:19.800 --> 00:08:23.000 may be short-term volatility associated with this but if you look out over 157 00:08:22.800 --> 00:08:26.300 time, you know, what what do we see going back to 158 00:08:26.000 --> 00:08:29.200 you know, as long as we have records 1926 and Beyond 159 00:08:29.000 --> 00:08:32.600 right Imperial heads when interest rates 160 00:08:32.300 --> 00:08:36.300 go up interest rates go down inflationary environments disinflationary environments 161 00:08:35.900 --> 00:08:40.100 recessionary environments across all of those things markets 162 00:08:38.900 --> 00:08:42.400 tend to produce a return 163 00:08:42.100 --> 00:08:45.700 of you know, seven to ten percent average annual 164 00:08:45.400 --> 00:08:49.000 you don't get that every year but you get on average over time and it's 165 00:08:48.700 --> 00:08:52.200 paying you for those cash flows so much like, 166 00:08:51.900 --> 00:08:55.100 you know, the all the comments that we've had prior to 167 00:08:54.900 --> 00:08:55.200 this. 168 00:08:56.500 --> 00:08:59.900 As investors, it's important to sort of take in its Stride 169 00:08:59.800 --> 00:09:02.900 Right put some blinders on there may be volatility associated with 170 00:09:02.800 --> 00:09:06.400 this ride. You will get wet on this ride. Right but we 171 00:09:05.800 --> 00:09:08.900 promise you'll come out in the other side, right and when you do, 172 00:09:08.800 --> 00:09:11.900 you know, the markets will get back to doing what they 173 00:09:11.800 --> 00:09:15.000 do, which is you know, paying you for putting Capital to work 174 00:09:15.000 --> 00:09:18.400 in there. So so that I would say again we watch these 175 00:09:18.100 --> 00:09:21.300 things. We we sort of especially working 176 00:09:21.100 --> 00:09:24.200 in the industry. It's a incumbent upon 177 00:09:24.100 --> 00:09:27.200 us to have some product prognostication about where this could 178 00:09:27.100 --> 00:09:30.800 be headed at the end of the day what we think matters very little it's 179 00:09:30.100 --> 00:09:33.300 what actually happens and we build portfolios to 180 00:09:33.100 --> 00:09:36.600 be as robust as we can because Anything Could Happen. Yeah, that's that's fantastic. 181 00:09:36.100 --> 00:09:39.300 And that's a really good way of putting it. We don't know what's 182 00:09:39.100 --> 00:09:40.000 happening, but we're 183 00:09:41.000 --> 00:09:45.000 We're invested in a way to endure what's to come? Right? Exactly. So 184 00:09:44.100 --> 00:09:47.500 one of the headlines that we we spent 185 00:09:47.300 --> 00:09:50.700 a lot of time talking to advisors and investors alike is the 186 00:09:50.600 --> 00:09:54.200 the notion of the banks and we saw from Silicon Valley 187 00:09:54.000 --> 00:09:56.100 and First Republic and a few others. 188 00:09:57.000 --> 00:10:00.200 I think it's a it's a risk reward story. But I also think 189 00:10:00.000 --> 00:10:04.400 this is the diversification story there. I'd love to hear your thoughts. Yeah. Well, yes, 190 00:10:03.700 --> 00:10:05.500 I think 191 00:10:06.600 --> 00:10:08.300 the the situation with the banks 192 00:10:09.300 --> 00:10:13.300 has a lot to do with other stuff, right? Yes, the 193 00:10:12.600 --> 00:10:15.800 the banks were quick to come out and say well this 194 00:10:15.600 --> 00:10:18.800 is a consequence of how rapidly the FED is 195 00:10:18.600 --> 00:10:22.300 raised interest rates. And this is potentially impaired the 196 00:10:22.200 --> 00:10:25.300 asset base of these Banks and there's no question right over the 197 00:10:25.200 --> 00:10:28.600 course of 2022. You saw the asset base 198 00:10:28.200 --> 00:10:31.500 drop significantly across banks in 199 00:10:31.400 --> 00:10:34.800 general because right so, you know first principles, 200 00:10:34.400 --> 00:10:37.500 what is a bank do they take money in when they 201 00:10:37.500 --> 00:10:41.100 take that money in as a deposit? It's a liability to them. Right? 202 00:10:40.500 --> 00:10:43.600 So they take that liability and they got to go match it up 203 00:10:43.500 --> 00:10:47.000 with an asset and they do that either by making loans and if 204 00:10:46.900 --> 00:10:50.800 they can't make enough loans, then they got to go buy bonds treasuries. 205 00:10:50.300 --> 00:10:53.800 For instance, right? Yes. That's the old against the 206 00:10:53.300 --> 00:10:56.600 liabilities. So if you if you've got a bank that 207 00:10:56.300 --> 00:10:59.600 has a bunch of bonds that they're holding as an asset 208 00:10:59.300 --> 00:11:03.000 and the value of those bonds dramatically drop. They've lost 209 00:11:02.600 --> 00:11:06.000 a lot of money against the liabilities that 210 00:11:05.900 --> 00:11:08.800 are still where they are, right and 211 00:11:09.200 --> 00:11:13.400 So that's that's the the challenge for 212 00:11:12.900 --> 00:11:13.900 the financial. 213 00:11:15.800 --> 00:11:19.200 sector and it no surprise the financial sector 214 00:11:18.900 --> 00:11:22.600 was sort of the worst performing sector for the first quarter in large 215 00:11:22.400 --> 00:11:23.700 part because of these Dynamics 216 00:11:24.800 --> 00:11:28.300 It was a part of what happened at svb. It was a catalyst 217 00:11:27.800 --> 00:11:31.300 for the bank run that followed but the bank 218 00:11:31.000 --> 00:11:34.500 run followed because of the unique dynamics of 219 00:11:34.400 --> 00:11:38.100 svb, correct? Right and the the failure 220 00:11:37.500 --> 00:11:40.900 of silvergate was 221 00:11:40.500 --> 00:11:44.200 function of crypto and had as 222 00:11:43.800 --> 00:11:47.500 much to do with FTX the failure of FTX, which 223 00:11:47.200 --> 00:11:50.300 was a Ponzi scheme, right? So you have 224 00:11:50.200 --> 00:11:54.300 a lot of kind of very unique situations Signature Bank, 225 00:11:54.100 --> 00:11:58.000 very crypto focused right First Republic the 226 00:11:57.100 --> 00:12:00.900 very very heavily on 227 00:12:00.200 --> 00:12:04.200 the asset side writing interest only mortgages 228 00:12:03.400 --> 00:12:06.700 right in to a degree that other 229 00:12:06.500 --> 00:12:10.500 Banks didn't have some unique characteristics of these Banks which cause 230 00:12:09.900 --> 00:12:13.600 them to be sort of the canary in the coal mine if you will right 231 00:12:12.900 --> 00:12:16.100 and Credit Suisse just 232 00:12:18.000 --> 00:12:21.100 Has struggled for years, right? And this was 233 00:12:21.000 --> 00:12:24.500 just the nail in the coffin form. The concern is are they 234 00:12:24.200 --> 00:12:27.600 the canary in the coal mine or are they just being punished because 235 00:12:27.400 --> 00:12:29.900 the malfeasance and poor management? 236 00:12:31.000 --> 00:12:34.700 And I think the answer is a bit of both, right? So the the 237 00:12:34.400 --> 00:12:38.400 fed and other institutions got 238 00:12:38.000 --> 00:12:41.900 together and said, hey, we got a backstop this thing to keep any contagion 239 00:12:41.300 --> 00:12:45.300 from spreading and assure depositors that 240 00:12:45.200 --> 00:12:48.600 they're deposits are safe, even if the value of the bond the assets 241 00:12:48.200 --> 00:12:51.600 that these banks are holding have dropped down. We the the government 242 00:12:51.200 --> 00:12:54.300 are going to step in and and backstop not just 243 00:12:54.200 --> 00:12:57.300 your 250,000 but everything right that was 244 00:12:57.300 --> 00:13:00.500 the strong message that they sent and that sort of seem to 245 00:13:00.300 --> 00:13:03.600 work, right it calm markets. Thanks for still being sort of reviewed and 246 00:13:03.500 --> 00:13:06.500 I would say look there's there could be more to this story. There could be 247 00:13:06.500 --> 00:13:09.800 other shoes to drop in time. Right? So you'll continue 248 00:13:09.500 --> 00:13:12.600 to watch it. I think as in as a person 249 00:13:12.500 --> 00:13:15.600 who has money at a bank, right am I rushing to pull my money 250 00:13:15.500 --> 00:13:18.800 out? No, I'm fairly confident that you know, 251 00:13:18.800 --> 00:13:21.500 we're we're gonna survive this right now. 252 00:13:22.400 --> 00:13:26.100 Did I say the same thing in 2008 when when I 253 00:13:25.700 --> 00:13:28.900 really thought hey, man, the whole financial system could go down. 254 00:13:28.800 --> 00:13:32.300 These Banks had collapse in Mass. I don't think we're anywhere 255 00:13:31.900 --> 00:13:35.300 near that I think banks are much healthier than than they 256 00:13:35.100 --> 00:13:39.900 were then and I think the issues that they have have to do with treasuries and 257 00:13:39.800 --> 00:13:43.200 the FED has said look, we're gonna step in and provide as much liquidity 258 00:13:42.800 --> 00:13:46.400 as necessary for the banks. So this becomes 259 00:13:45.900 --> 00:13:49.700 a potential issue down the down the pike, right? If 260 00:13:49.200 --> 00:13:52.700 in fact the FED has to step in and provide the 261 00:13:52.300 --> 00:13:55.700 Surplus liquidity to the treasury market, 262 00:13:55.500 --> 00:13:56.800 why might they have to do that? 263 00:13:57.800 --> 00:14:01.000 Well, if for some reason we default on the debt ceiling for instance, 264 00:14:00.800 --> 00:14:04.200 right that could be very problematic and the FED 265 00:14:04.000 --> 00:14:07.200 might have to take aggressive steps in a way that we've 266 00:14:07.100 --> 00:14:11.300 never seen before to step in and try and provide Surplus liquidity 267 00:14:10.700 --> 00:14:14.000 specifically to the treasury market. That would 268 00:14:13.800 --> 00:14:17.300 be a complete roll reversal of where we've been right? That's that's 269 00:14:17.000 --> 00:14:20.900 taking the quantitative tightening off the table and now we're back to quantities, right 270 00:14:20.400 --> 00:14:23.600 so so could things come down the bike that 271 00:14:23.500 --> 00:14:26.900 would cause a, you know, real dislocation to 272 00:14:26.500 --> 00:14:29.900 banking to markets sure it could happen 273 00:14:29.700 --> 00:14:32.900 again. Who knows right? Everybody's got a crystal 274 00:14:32.800 --> 00:14:33.100 ball. 275 00:14:34.100 --> 00:14:37.700 Nobody's usually right spot on about what's gonna happen, but 276 00:14:37.200 --> 00:14:40.400 it's a potential risk that you want. Hey, look this might happen, but 277 00:14:40.300 --> 00:14:41.000 we'll survive. 278 00:14:41.600 --> 00:14:45.200 Yeah, no, absolutely. And as you said before, I mean, it seems like the markets 279 00:14:44.600 --> 00:14:45.300 have. 280 00:14:46.100 --> 00:14:49.600 sort of shrugged off those headlines because we've seen some pretty decent returns 281 00:14:49.100 --> 00:14:52.000 and in q1, but I think you know in 282 00:14:53.200 --> 00:14:56.500 Let's let's go back to the text docs, right? I mean that's what's really 283 00:14:56.300 --> 00:14:57.800 leading the charge here, isn't it? 284 00:14:58.800 --> 00:14:59.000 well 285 00:15:00.000 --> 00:15:01.800 I think there are a lot of Dynamics at play. 286 00:15:02.400 --> 00:15:06.000 But underpinning all of that is risk and reward right? 287 00:15:05.500 --> 00:15:08.800 I mean that at the end of the day, it's that simple 288 00:15:08.600 --> 00:15:11.700 what are the risks and what are the rewards and how much am I 289 00:15:11.600 --> 00:15:15.400 willing to pay for those rewards? And am I underestimating those 290 00:15:15.200 --> 00:15:18.800 risks? Right? So everything is sort of a function of those things 291 00:15:18.600 --> 00:15:22.000 and so I would say look in equities. The the 292 00:15:21.600 --> 00:15:25.200 tech stocks is a risk, right? There's there's certainly reward 293 00:15:25.000 --> 00:15:28.400 there's upside there. We're seeing it in terms of markets, but I think there's risk 294 00:15:28.100 --> 00:15:31.800 right in fixed income. There's potential 295 00:15:31.200 --> 00:15:34.600 risk associated with the yield curve 296 00:15:34.400 --> 00:15:39.000 and what happens with the fed and raising rates in areas, 297 00:15:38.100 --> 00:15:41.600 like financials. There's risks 298 00:15:41.200 --> 00:15:44.800 right associated with that. I think the key 299 00:15:44.500 --> 00:15:47.800 takeaway for that for anybody looking at 300 00:15:47.600 --> 00:15:48.300 it is 301 00:15:49.200 --> 00:15:52.500 Broad diversification not just in 302 00:15:52.200 --> 00:15:55.600 one geography not just inequities not just in fixed income 303 00:15:55.300 --> 00:15:58.300 across factors as much as you 304 00:15:58.300 --> 00:16:01.800 can broadly diversify the more robust your portfolio is to 305 00:16:01.300 --> 00:16:04.200 stand up to any of those unique risks. 306 00:16:04.900 --> 00:16:06.800 And so I would I would say. 307 00:16:08.200 --> 00:16:12.100 That that would be where I would encourage investors to 308 00:16:11.700 --> 00:16:13.100 sort of keep their heads. 309 00:16:14.100 --> 00:16:17.400 I it's always challenging when you have tech stocks doing 310 00:16:17.300 --> 00:16:20.800 as well as they are because they drive 311 00:16:20.400 --> 00:16:23.700 markets you want to be there. You want to participate in it. 312 00:16:23.500 --> 00:16:27.400 There's a a benefit socially to 313 00:16:26.700 --> 00:16:30.100 holding names that people are familiar 314 00:16:29.700 --> 00:16:33.000 with and talk about right if you think about the 315 00:16:32.700 --> 00:16:36.000 fomo experience that people have 316 00:16:35.700 --> 00:16:38.900 missing if you're missing out, right? Yeah, my next 317 00:16:38.900 --> 00:16:41.900 door neighbor. He's he's got Google and apple and they're tear on 318 00:16:41.900 --> 00:16:45.800 the cover off the ball. Never mind. What happened last year right now, I gotta you 319 00:16:45.100 --> 00:16:48.500 know, keep up with the Joneses on that water cooler. Alpha 320 00:16:48.100 --> 00:16:51.600 is what I call that. Yeah water cooler Alpha and I would just 321 00:16:51.300 --> 00:16:54.900 say hey look at the end of the day. We're people right if we 322 00:16:54.600 --> 00:16:57.800 were autonomous, you know Vulcans. This would just be 323 00:16:57.700 --> 00:17:01.000 economics and math and we can figure it all out reality is 324 00:17:00.900 --> 00:17:04.700 we're people and you got to build a portfolio you can live with right as 325 00:17:04.200 --> 00:17:07.300 our as our good friend Phil Henry says, you 326 00:17:07.200 --> 00:17:10.700 got to build a portfolio you can live with and then live with it, right? I think 327 00:17:10.700 --> 00:17:13.400 that's absolutely true. And so you have to take into account. 328 00:17:14.000 --> 00:17:17.700 The the investor psychology associated with this that's 329 00:17:17.000 --> 00:17:20.200 why I think momentum is such a 330 00:17:20.000 --> 00:17:23.500 powerful factor to build into your portfolios 331 00:17:23.000 --> 00:17:26.200 because momentum picks up 332 00:17:26.000 --> 00:17:29.400 these like when tech stocks going to run you end up 333 00:17:29.400 --> 00:17:33.400 owning things like Apple and Google and because they 334 00:17:32.900 --> 00:17:37.100 are demonstrating positive momentum, right? So you you're picking 335 00:17:36.400 --> 00:17:39.800 up some of that you're participating in that upside and I 336 00:17:39.800 --> 00:17:42.900 think as a as an investor, that's that would probably be enough for 337 00:17:42.800 --> 00:17:46.400 me, right? It's a modicum of the things that I everybody else 338 00:17:46.200 --> 00:17:49.400 is holding that that's working but it's also stuff that's not working 339 00:17:49.300 --> 00:17:52.400 because eventually that circles around and that becomes the thing 340 00:17:52.300 --> 00:17:55.600 that's worth. I don't have to try and time it. I'm just holding it and I'm 341 00:17:55.400 --> 00:17:58.600 waiting keeping my powder dry in that area so that when it 342 00:17:58.400 --> 00:18:02.100 does I benefit that that's how I would think about it look again 343 00:18:01.700 --> 00:18:03.100 tech stocks are 344 00:18:04.300 --> 00:18:08.300 The amazing thing about markets is they run longer than you think they should right. They're 345 00:18:07.900 --> 00:18:12.100 fueled by stuff. Sometimes you don't understand and and 346 00:18:11.600 --> 00:18:15.100 in many cases, I think the 347 00:18:14.700 --> 00:18:18.500 tech stock Dynamic is is part 348 00:18:17.800 --> 00:18:21.300 fairy dust, right and you know, 349 00:18:21.200 --> 00:18:24.500 we watched it run for a decade and drive markets, you know 350 00:18:24.500 --> 00:18:28.800 for you know, double digit returns for years because 351 00:18:27.800 --> 00:18:31.900 that happen again, of course, it could right. I'm not 352 00:18:31.900 --> 00:18:35.700 gonna tell you again. I am cautious about the 353 00:18:35.200 --> 00:18:38.600 dynamic being set up looking very similar to 354 00:18:38.500 --> 00:18:42.200 the dynamic that we saw at you know, 2019 2020. 355 00:18:41.700 --> 00:18:45.000 Yeah. No, absolutely and you know that seems like that tech 356 00:18:44.700 --> 00:18:47.900 store keeps popping up. I started my career in the late 90s and that was the 357 00:18:47.800 --> 00:18:50.600 whole story and then I saw a lot of portfolios. 358 00:18:51.300 --> 00:18:55.100 A lot of people see their portfolios blow up but because of overexposure to 359 00:18:55.000 --> 00:18:58.500 to technology and they having a 360 00:18:58.400 --> 00:19:02.400 balanced portfolio Diversified across multiple asset classes regions geographies. 361 00:19:01.900 --> 00:19:05.000 That's that's the best course of action at the 362 00:19:04.900 --> 00:19:10.100 end of the day. So yeah, I think I go back to the the E-Trade 363 00:19:09.300 --> 00:19:12.600 baby, right if you remember the E-Trade baby so easy 364 00:19:12.500 --> 00:19:15.800 baby. Yeah that was born right on the text actually and then 365 00:19:15.600 --> 00:19:18.700 they they put the baby away for a while baby's back right now. I was 366 00:19:18.600 --> 00:19:21.800 a little bit older now, he's out of the wedding, you know hanging out 367 00:19:21.700 --> 00:19:25.200 with this guys and gals but to 368 00:19:24.800 --> 00:19:28.200 me that a Hallmark of a caution, right because 369 00:19:27.900 --> 00:19:32.000 the reality is it's it's easy but 370 00:19:31.600 --> 00:19:34.900 hard right it's not you know, it's not 371 00:19:34.700 --> 00:19:38.500 difficult to say. Hey look broadly based diversification sit still it's 372 00:19:37.700 --> 00:19:41.000 incredibly difficult to do. Yeah, right and that's where 373 00:19:40.900 --> 00:19:45.100 the real benefit of working with financial professionals comes in because everybody 374 00:19:44.300 --> 00:19:47.900 thinks they can do it everybody. They're gonna be Spock 375 00:19:47.300 --> 00:19:50.600 and devoid of emotion, but then the moment of truth comes 376 00:19:51.200 --> 00:19:54.200 The market drops 40% and you're looking at like am I gonna 377 00:19:54.200 --> 00:19:57.400 be able to retire? Right and the fear grips hold and it's 378 00:19:57.200 --> 00:20:00.900 2 am and you're thinking what do I do? Right. That's 379 00:20:00.300 --> 00:20:03.400 when you need to have that dispassionate third party 380 00:20:03.300 --> 00:20:07.700 to pick up the phone and say I want to sell everything. They whoa. Let's 381 00:20:07.100 --> 00:20:11.000 revisit right like is anything changed? Oh the 382 00:20:10.400 --> 00:20:13.700 market drop 40% right has anything in your life changed right? 383 00:20:13.400 --> 00:20:16.800 Maybe that's not the best course of action. Let's take a beat having that 384 00:20:16.600 --> 00:20:20.000 dispassionate a third party to keep you from blowing yourself up 385 00:20:19.700 --> 00:20:23.000 at that exact moment is invaluable. Yeah 386 00:20:22.700 --> 00:20:26.400 and making sure you have the right mix between stocks bonds 387 00:20:26.000 --> 00:20:29.900 and maybe even Alternatives depending on the investor and if someone 388 00:20:29.500 --> 00:20:33.000 can't sleep at night, it's not necessarily that they should take action, 389 00:20:32.600 --> 00:20:35.800 but they might be in the wrong asset allocation for 390 00:20:35.600 --> 00:20:36.200 their 391 00:20:37.300 --> 00:20:41.000 The risk, you know their ability to accept right? Yeah, 392 00:20:40.600 --> 00:20:45.800 it could be that often. What I've 393 00:20:45.500 --> 00:20:48.800 experienced is when it's that it's because the client wanted 394 00:20:48.500 --> 00:20:52.000 more Tech right in their portfolios or more of what's 395 00:20:51.700 --> 00:20:55.100 working, right? And then when that's no longer working, they 396 00:20:54.700 --> 00:20:57.700 can't sleep at night, but cautionary Tale the other 397 00:20:57.700 --> 00:21:01.900 piece of that is we're surrounded by the news 24/7 398 00:21:01.000 --> 00:21:04.600 right? It's just and it's always the whatever 399 00:21:04.100 --> 00:21:07.700 bleeds leads right? And so it's this constant 400 00:21:07.100 --> 00:21:12.200 drum beat of kind of negative stuff. And I think that investors 401 00:21:10.400 --> 00:21:13.700 need a voice. 402 00:21:14.600 --> 00:21:18.000 That that they trust to say. Hey, yeah. No I 403 00:21:17.800 --> 00:21:21.600 saw that too. Yes, that bank went out of business. Here's 404 00:21:20.800 --> 00:21:24.600 why we shouldn't Panic here, right? Yep. We 405 00:21:24.500 --> 00:21:28.300 see all that. Here's why we're gonna stay the course. Here's why we're not gonna Panic. Here's 406 00:21:27.800 --> 00:21:31.200 what let's you know, our long-term goals are and we're in good 407 00:21:31.100 --> 00:21:35.000 shape to hit those. I think that sort of calming reassurance 408 00:21:34.500 --> 00:21:37.700 helps people get back to sleeping at night. Yeah. No, 409 00:21:37.500 --> 00:21:40.800 I agree Casey as always. It's a pleasure talking to you. 410 00:21:40.700 --> 00:21:43.800 Thanks for joining us great having you here and I want to thank all of 411 00:21:43.700 --> 00:21:47.400 our listeners and these feel free to access other podcasts 412 00:21:46.800 --> 00:21:49.800 that we have done and they can be 413 00:21:49.800 --> 00:21:53.300 accessed anywhere you get your podcast. 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The sudden failure of Silicon Valley Bank in March jostled investors' confidence in the market. But, the overall performance of various tech stocks in Q1, such as Tesla, Meta, Alphabet, Amazon, Salesforce, AMD, and Broadcom, served to revive optimism for the stock market's near future. Join Casey Dylan, CIMA®, Consultant, and our host Tom Romano, Head of Strategic Relationships and Product Development, in this first half of of our Q1 recap, as we discuss both market, and factor performance, in the first few months of 2023. If you have any questions or would like more information, reach out to us at https://symmetrypartners.com/contact-us/ You can also find us on Facebook, YouTube, Twitter, and LinkedIn. As always, we remain invested in your goals. Symmetry Partners, LLC, is an investment advisory firm registered with the Securities and Exchange Commission. The firm only transacts business in states where it is properly registered, excluded or exempted from registration requirements. Registration of an investment adviser does not imply any specific level of skill or training and does not constitute an endorsement of the firm by the Commission. No one should assume that future performance of any specific investment, investment strategy, product or non-investment related content made reference to directly or indirectly in this material will be profitable. As with any investment strategy, there is the possibility of profitability as well as loss. Due to various factors, including changing market conditions and/or applicable laws, the content may not be reflective of current opinions or positions.   Please note the material is provided for educational and background use only. Moreover, you should not assume that any discussion or information contained in this material serves as the receipt of, or as a substitute for, personalized investment advice.   Transcript: 0 00:00:01.900 --> 00:00:07.400 Good afternoon, 1 00:00:07.400 --> 00:00:10.700  everyone. This is Tom Romano head of strategic relationships at 2 00:00:10.700 --> 00:00:14.200  symmetry partners and joined with me. Today is Casey Dillon 3 00:00:13.200 --> 00:00:16.900  a long time friend of symmetry and our 4 00:00:16.900 --> 00:00:19.500  internal communication strategist. Thank you Casey for 5 00:00:19.500 --> 00:00:22.400  joining us today. Tom is excellent to be here with you live in 6 00:00:22.400 --> 00:00:25.100  person. Yeah, fantastic. Fantastic So today, we're gonna go 7 00:00:25.100 --> 00:00:28.900  through our q1 2023 quarter in 8 00:00:28.900 --> 00:00:31.700  perspective. It's been quite the 9 00:00:31.700 --> 00:00:34.800  interesting quarter to say the least we've had 10 00:00:34.800 --> 00:00:37.800  some volatile markets. Although 11 00:00:37.800 --> 00:00:40.400  I'll be at some positive results. We've seen things 12 00:00:40.400 --> 00:00:43.300  like banking collapses in the headlines. There's still of 13 00:00:43.300 --> 00:00:46.600  course the concerns about inflation. And so 14 00:00:46.600 --> 00:00:49.800  Casey thank you for joining us to give us some perspective 15 00:00:49.800 --> 00:00:52.300  of what's going on in the market. So in a 16 00:00:52.300 --> 00:00:55.800  nutshell what happened in q1 of 2023, yeah 17 00:00:55.800 --> 00:00:58.300  in a nutshell, I'll be brief if I 18 00:00:58.300 --> 00:01:00.500  can so if you recall 19 00:01:01.800 --> 00:01:04.300 The fourth quarter of last year, right? The 20 00:01:04.300 --> 00:01:07.600  last year was a brutal year across a number of metrics, but 21 00:01:07.600 --> 00:01:10.500  the fourth quarter we started to see some respite 22 00:01:10.500 --> 00:01:13.300  from that and the first two months of the fourth quarter, 23 00:01:13.300 --> 00:01:16.600  right? We saw markets actually rebound pretty 24 00:01:16.600 --> 00:01:19.500  significantly in October and November and much of 25 00:01:19.500 --> 00:01:23.000  that was driven by the sense across 26 00:01:22.700 --> 00:01:25.900  the markets Market participants that maybe 27 00:01:25.900 --> 00:01:28.500  the Fed was done raising interest rates, maybe 28 00:01:28.500 --> 00:01:31.400  that the inflationary pressures that 29 00:01:31.400 --> 00:01:34.700  we had seen in the spring of 2022. We're 30 00:01:34.700 --> 00:01:37.400  starting to Abate and the market is 31 00:01:37.400 --> 00:01:40.800  a forward-looking forward pricing mechanism. And so 32 00:01:42.200 --> 00:01:45.200 In the fourth quarter, that's what it did. It looked forward. 33 00:01:45.200 --> 00:01:48.700  It started to anticipate a period when the the 34 00:01:48.700 --> 00:01:51.300  Fed was not raising interest rates and inflation would be tamed. 35 00:01:51.300 --> 00:01:55.100  And of course what happened in December was 36 00:01:54.100 --> 00:01:57.800  a bit of a comeuppance for 37 00:01:57.800 --> 00:02:00.400  those Market participants who got a little bit ahead of 38 00:02:00.400 --> 00:02:03.500  the fed and we saw a pullback in 39 00:02:03.500 --> 00:02:03.700  December. 40 00:02:04.400 --> 00:02:07.600 And markets responding to the fact that the FED said well, no, 41 00:02:07.600 --> 00:02:10.500  we're pretty set on continuing to raise rates. 42 00:02:10.500 --> 00:02:12.800  And and we think we're gonna keep them higher longer. 43 00:02:13.700 --> 00:02:16.500 As we rolled into the first quarter of this year. We saw 44 00:02:16.500 --> 00:02:19.900  a replay of a lot of those Dynamics coming into 45 00:02:19.900 --> 00:02:23.000  January Market participants 46 00:02:22.300 --> 00:02:24.000  again. It's sort of 47 00:02:25.400 --> 00:02:28.200 Determined that this was the year the Fed was 48 00:02:28.200 --> 00:02:31.100  going to stop rate and Market participants started to 49 00:02:31.100 --> 00:02:34.200  look forward and price as if the not only 50 00:02:34.200 --> 00:02:37.600  with the FED stop racing rates, but they would start to pull rates 51 00:02:37.600 --> 00:02:42.400  back by the end of the year given where people 52 00:02:41.400 --> 00:02:45.300  reading the tea leaves assumed the 53 00:02:45.300 --> 00:02:47.500  economy would be by mid-year. 54 00:02:48.200 --> 00:02:51.800 And so you saw a really robust Rebound in 55 00:02:51.800 --> 00:02:54.000  January for a lot of the names that have been 56 00:02:54.200 --> 00:02:57.900  really beat up in 2022 specifically the 57 00:02:57.900 --> 00:03:01.000  large cab growth and Tech names and 58 00:03:00.300 --> 00:03:03.200  so there was something of a reversion to 59 00:03:03.200 --> 00:03:06.300  the mean in terms of those names really 60 00:03:06.300 --> 00:03:09.500  leading the charge in January. Those are 61 00:03:09.500 --> 00:03:12.200  the names that were most beaten up in 2022. Those are the 62 00:03:12.200 --> 00:03:15.500  names that snap back fastest in the 63 00:03:15.500 --> 00:03:18.500  first quarter. And so January where we 64 00:03:18.500 --> 00:03:22.900  saw for instance the S&P down 20% for 65 00:03:22.900 --> 00:03:25.200  2022. We saw 66 00:03:25.200 --> 00:03:28.100  a Resurgence just in the month of January the SP was up 67 00:03:28.100 --> 00:03:31.400  like eight percent and the NASDAQ double that right just on the 68 00:03:31.400 --> 00:03:34.400  strength of kind of those large cap Tech names and of course what happened 69 00:03:34.400 --> 00:03:38.100  as we rolled into February the news that 70 00:03:37.100 --> 00:03:40.400  came out on the sort of 71 00:03:40.400 --> 00:03:43.400  economic underpinnings specifically job data for 72 00:03:43.400 --> 00:03:47.100  January really surprised Market 73 00:03:46.100 --> 00:03:48.100  participants because 74 00:03:48.200 --> 00:03:52.400 It was so robust. So strong it exceeded expectations. It 75 00:03:51.400 --> 00:03:54.800  served as a really Stark reminder that we're 76 00:03:54.800 --> 00:03:55.500  not out of the woods yet. 77 00:03:56.200 --> 00:03:59.500 And and it sent shock waves 78 00:03:59.500 --> 00:04:02.400  across the market in the sense that everyone who 79 00:04:02.400 --> 00:04:06.000  had said. Okay. Well now the FED is gonna have to wind this down all 80 00:04:05.200 --> 00:04:08.400  the sudden the the realized maybe not 81 00:04:08.400 --> 00:04:11.400  right not only is the fed maybe not gonna wind this 82 00:04:11.400 --> 00:04:14.700  down because the economy is hotter than we thought it was but we potentially 83 00:04:14.700 --> 00:04:17.600  risk sort of a flare-up of inflation 84 00:04:17.600 --> 00:04:20.100  just as it was coming down and the FED may have 85 00:04:20.100 --> 00:04:23.500  to get more aggressive in in tackling that and 86 00:04:23.500 --> 00:04:27.000  so February saw sort of a revisitation of 87 00:04:26.400 --> 00:04:29.500  those expectations that market participants 88 00:04:29.500 --> 00:04:33.100  had and as we rolled into March then all 89 00:04:32.100 --> 00:04:35.800  eyes were on the Senate 90 00:04:35.800 --> 00:04:38.700  hearings with the the chairman 91 00:04:38.700 --> 00:04:41.200  of the fed and based on his 92 00:04:41.200 --> 00:04:44.700  comments Futures skyrocketed for an expectation 93 00:04:44.700 --> 00:04:47.200  of a 50 basis point raise at 94 00:04:47.200 --> 00:04:50.500  the end of March the Futures went up to like a 70% chance that 95 00:04:50.500 --> 00:04:53.300  the Fed was gonna raise 50 basis points, and 96 00:04:53.300 --> 00:04:55.500  of course what happened then you know days later. 97 00:04:56.100 --> 00:05:00.000 Started imploding right and that sort 98 00:04:59.100 --> 00:05:03.000  of Royal financial markets and 99 00:05:02.500 --> 00:05:05.200  the FED did end up raising rates. But 100 00:05:05.200 --> 00:05:08.200  only by 25 basis points after they had worked to 101 00:05:08.200 --> 00:05:11.200  sort of rescue. I don't know rescues the 102 00:05:11.200 --> 00:05:15.500  right term but step in aggressively and calm markets 103 00:05:14.500 --> 00:05:17.200  particularly folks who 104 00:05:17.200 --> 00:05:20.600  had cash on deposited Banks to keep sort 105 00:05:20.600 --> 00:05:23.200  of a contagion effect and a larger Bank Run taking place. 106 00:05:23.200 --> 00:05:26.800  Right? So we end the first quarter with a really 107 00:05:26.800 --> 00:05:29.900  sort of wild trip of markets shooting 108 00:05:29.900 --> 00:05:32.500  up coming back down a lot of volatility a lot 109 00:05:32.500 --> 00:05:35.400  of fear injected in markets in March with the 110 00:05:35.400 --> 00:05:38.300  headlines and yet at the end of the quarter you finished up 111 00:05:38.300 --> 00:05:41.900  pretty again pretty solidly across 112 00:05:41.900 --> 00:05:45.000  us markets International Development markets emerging 113 00:05:44.400 --> 00:05:47.700  markets in fixed income inequities, right? 114 00:05:47.700 --> 00:05:50.400  We it was a it was a pretty decent first 115 00:05:50.400 --> 00:05:53.800  quarter from a return perspective despite all of that. Yeah sure. 116 00:05:53.800 --> 00:05:56.000  It was like it's a very interesting quarter. 117 00:05:56.100 --> 00:05:59.200 And I'd like the way you put it on the things the kind of the Resurgence of 118 00:05:59.200 --> 00:06:03.100  these tech companies that didn't have a great year last year, but you're 119 00:06:02.100 --> 00:06:05.500  seeing asset classes such as the energy 120 00:06:05.500 --> 00:06:08.600  sector right who had a great year last year is to 121 00:06:08.600 --> 00:06:11.300  use your your term of aversion to the mean right? They had 122 00:06:11.300 --> 00:06:14.500  a tough time in the first quarter, right? Yeah. Yeah and and frankly 123 00:06:14.500 --> 00:06:18.200  prices have been coming down in oil and gas pretty 124 00:06:17.200 --> 00:06:18.800  consistently. 125 00:06:19.200 --> 00:06:22.800 Since last fall so we did see a continuation of that. I 126 00:06:22.800 --> 00:06:27.300  do think and likely there's 127 00:06:26.300 --> 00:06:29.200  more conversation to be had 128 00:06:29.200 --> 00:06:32.900  around this but the concern that I have or 129 00:06:32.900 --> 00:06:35.500  or would have based on 130 00:06:35.500 --> 00:06:38.600  how markets performed in the first quarter is that 131 00:06:38.600 --> 00:06:41.900  it was so dominated by a 132 00:06:41.900 --> 00:06:44.100  handful of names, right? We we've seen 133 00:06:44.100 --> 00:06:47.300  this Dynamic before where we're 134 00:06:47.300 --> 00:06:51.000  sort of the top largest growth Tech 135 00:06:50.300 --> 00:06:53.800  names sort of dominate performance 136 00:06:53.800 --> 00:06:56.500  of the market and we and we saw that again in 137 00:06:56.500 --> 00:07:01.500  the first quarter right? You think about Facebook alphabet 138 00:07:00.500 --> 00:07:04.700  Apple Google Netflix, right? 139 00:07:03.700 --> 00:07:06.500  All of those firms were 140 00:07:06.500 --> 00:07:09.500  really been challenged in 2022 had a 141 00:07:09.500 --> 00:07:12.300  nice Resurgence across the first quarter, but when 142 00:07:12.300 --> 00:07:16.000  you dig deeper into the performance particularly here domestically what 143 00:07:15.200 --> 00:07:18.900  you see is they were the lion 144 00:07:19.100 --> 00:07:22.400 Care of that return that we saw the market it was once again 145 00:07:22.400 --> 00:07:27.100  the fact that these top handful of names represent twenty 146 00:07:25.100 --> 00:07:28.600  plus percent of the overall 147 00:07:28.600 --> 00:07:32.000  market, right? So think S&P 500 has got ostensibly 500 148 00:07:31.500 --> 00:07:34.700  names in it the top 10 names 149 00:07:34.700 --> 00:07:38.000  accounted for all at 150 00:07:37.100 --> 00:07:40.400  least 80% of that return right the 151 00:07:40.400 --> 00:07:43.300  top top five names half of it, right? So so 152 00:07:43.300 --> 00:07:46.400  again, you're getting a lot of that return concentrated in 153 00:07:46.400 --> 00:07:47.000  these names. 154 00:07:47.900 --> 00:07:51.600 Because they're so large disproportionately to 155 00:07:50.600 --> 00:07:55.200  the other names in those indices 156 00:07:54.200 --> 00:07:57.300  and it lit. It's the rising tide lifting 157 00:07:57.300 --> 00:08:00.200  all boats, but the concern that you 158 00:08:00.200 --> 00:08:03.100  have with that and we saw that in 2022 when the 159 00:08:03.100 --> 00:08:06.600  air goes out of the balloon to a degree. Well that 160 00:08:06.600 --> 00:08:09.500  can be a double-edged sword. Right if those names start 161 00:08:09.500 --> 00:08:13.000  to pull back in valuations, you 162 00:08:12.300 --> 00:08:15.400  could see that turn around and become an anchor pulling 163 00:08:15.400 --> 00:08:19.000  markets down, right and that can happen very quickly just based 164 00:08:18.100 --> 00:08:21.600  on the fact that it's so concentrated in a 165 00:08:21.600 --> 00:08:24.000  handful of names that are all sort of in the 166 00:08:24.300 --> 00:08:27.100  same kind of economic Waters right in terms of kind of 167 00:08:27.100 --> 00:08:30.600  this large growth Tech, you know richly valued. 168 00:08:30.600 --> 00:08:33.100  Yeah. It sounds a lot like me, you know, I've 169 00:08:33.100 --> 00:08:37.200  had these conversations over the years even going back before 2022 170 00:08:36.200 --> 00:08:39.700  coming out of the pandemic 171 00:08:39.700 --> 00:08:42.300  and those tech stocks. They were the story they were leading 172 00:08:42.300 --> 00:08:45.400  the charge and what I'm hearing you say, is that sort 173 00:08:45.400 --> 00:08:47.800  of the casing q1, but that double-ed 174 00:08:47.800 --> 00:08:50.700 word is just going back 2022 would 175 00:08:50.700 --> 00:08:53.700  be an example of if you're not well Diversified 176 00:08:53.700 --> 00:08:56.800  that could be a painful experience it can and I'm 177 00:08:56.800 --> 00:08:57.900  I'm reminded of 178 00:08:59.300 --> 00:09:02.400 The experience that we had coming out of the tech bubble, 179 00:09:02.400 --> 00:09:05.300  right? So if you think about if in fact 180 00:09:05.300 --> 00:09:08.300  the run-up invaluations in this sort of handful of 181 00:09:08.300 --> 00:09:11.400  techniques is analogous to what we saw in 182 00:09:11.400 --> 00:09:12.000  the late 90s. 183 00:09:14.200 --> 00:09:17.300 They were so richly valued that when the 184 00:09:17.300 --> 00:09:20.600  tech Bubble Burst it took a decade the Lost 185 00:09:20.600 --> 00:09:24.200  decade right of just you know, subpar returns 186 00:09:23.200 --> 00:09:26.300  for the valuations to get 187 00:09:26.300 --> 00:09:29.500  back to a place where markets could then start 188 00:09:29.500 --> 00:09:32.400  to take off again. And so the concern that 189 00:09:32.400 --> 00:09:36.200  that one might have is valuations are 190 00:09:35.200 --> 00:09:40.400  still Rich, right? Even after 2022 on 191 00:09:39.400 --> 00:09:43.200  a Price to Book basis very 192 00:09:42.200 --> 00:09:45.600  expensive on a price to 193 00:09:45.600 --> 00:09:50.500  forward earnings basis. It's expensive and 194 00:09:48.500 --> 00:09:51.600  so it's not 195 00:09:51.600 --> 00:09:54.600  as if these are our Bargains to 196 00:09:54.600 --> 00:09:57.800  be had in a Marketplace that that's discounting 197 00:09:57.800 --> 00:10:00.700  them. They are still incredibly expensive. And so 198 00:10:00.700 --> 00:10:03.400  anything that goes wrong right if the 199 00:10:03.400 --> 00:10:06.300  if in fact the economy runs into turbulence at 200 00:10:06.300 --> 00:10:09.700  some point or the expectations for growth, I mean, 201 00:10:09.700 --> 00:10:12.600  you know, we're in earning season and Netflix had sort 202 00:10:12.600 --> 00:10:14.100  of positive numbers, but 203 00:10:14.100 --> 00:10:17.700 They sort of gave lackluster guidance for next quarters 204 00:10:17.700 --> 00:10:20.400  growth. Right? So all you need is for for Market 205 00:10:20.400 --> 00:10:23.400  participants to to a once again sour on the 206 00:10:23.400 --> 00:10:27.400  prospects of these names and you're right back to it's 207 00:10:26.400 --> 00:10:29.300  too too rich like I'm paying 208 00:10:29.300 --> 00:10:32.500  too much today for for earnings in 209 00:10:32.500 --> 00:10:35.100  the future that may or may not materialize right? And so 210 00:10:35.100 --> 00:10:38.700  I've got to pay less and so the price has to come down. Yeah, right. And 211 00:10:38.700 --> 00:10:41.300  again, I'm not suggesting that we have a lost decade 212 00:10:41.300 --> 00:10:44.200  in front of us, but this potentially room to run 213 00:10:44.200 --> 00:10:48.300  if markets turn and I think that's the the concern that 214 00:10:47.300 --> 00:10:50.100  I would share with investors. That's what I 215 00:10:50.100 --> 00:10:53.500  prepare them for. Hey, we'll take what we get. Right? We're happy 216 00:10:53.500 --> 00:10:54.700  to get those returns, but 217 00:10:56.200 --> 00:10:59.500 This could still be valve this this, you know, we're in the third inning potentially 218 00:10:59.500 --> 00:11:02.900  look or fourth ending. There's a lot of game left and we're 219 00:11:02.900 --> 00:11:05.000  just gonna buckle up and be ready for it. Yeah, and what is 220 00:11:05.300 --> 00:11:09.200  interesting what this quarter and you detect upon that I'd love to get your thoughts developed International 221 00:11:08.200 --> 00:11:11.300  to having a very good quarter. 222 00:11:11.300 --> 00:11:14.400  I mean when we saw these large Tech 223 00:11:14.400 --> 00:11:17.600  names and in the past when they had their run prior to 2022, it 224 00:11:17.600 --> 00:11:20.600  was a pretty much us dominated run up. 225 00:11:21.800 --> 00:11:24.500 Give us some commentary on what we're saying in the developed International 226 00:11:24.500 --> 00:11:27.100  Space. Yeah, I think some of 227 00:11:27.100 --> 00:11:31.600  it is the Resurgence of the 228 00:11:32.900 --> 00:11:35.700 strength of the sort 229 00:11:35.700 --> 00:11:38.200  of the the companies that are there that have 230 00:11:38.200 --> 00:11:42.000  sort of suffered through a decade of kind of sub-par performance 231 00:11:41.300 --> 00:11:45.400  and they were in a much stronger financial 232 00:11:44.400 --> 00:11:47.300  position. Then they 233 00:11:47.300 --> 00:11:51.300  were for instance going into the global financial crisis, right and they 234 00:11:50.300 --> 00:11:53.700  weren't super expensive. Right? 235 00:11:53.700 --> 00:11:58.100  So from a perspective of they were kind of relatively cheaply 236 00:11:56.100 --> 00:11:59.100  priced compared to 237 00:11:59.100 --> 00:12:02.500  US stocks. And so if we look at just the performance 238 00:12:02.500 --> 00:12:06.100  the they don't have to have that much right 239 00:12:05.100 --> 00:12:09.300  surprise upside. 240 00:12:10.300 --> 00:12:14.300 To have nice performance right across the board or 241 00:12:13.300 --> 00:12:16.200  relatively decent performs. 242 00:12:16.700 --> 00:12:19.800 So I think people were pleasantly surprised by 243 00:12:19.800 --> 00:12:23.500  some of the financial resilience in 244 00:12:22.500 --> 00:12:25.200  Europe particularly coming out of 245 00:12:25.200 --> 00:12:28.900  the effects of the the Russian Ukraine 246 00:12:28.900 --> 00:12:31.600  conflict and looking at the impact that 247 00:12:31.600 --> 00:12:34.500  for instance the the price of gas price 248 00:12:34.500 --> 00:12:37.100  of oil I had in places like Germany and the fact 249 00:12:37.100 --> 00:12:40.300  that they sort of got through that not unscathed but 250 00:12:40.300 --> 00:12:43.700  you know, the the avoided the apocalypse 251 00:12:43.700 --> 00:12:47.000  right the gasoline apocalypse over the course of the 252 00:12:46.600 --> 00:12:49.300  winter right that it was relatively mild. So 253 00:12:49.300 --> 00:12:52.600  I think that from that perspective markets sort 254 00:12:52.600 --> 00:12:55.600  of said rewarded International developed 255 00:12:55.600 --> 00:12:58.900  businesses with valuations that 256 00:12:58.900 --> 00:13:01.400  seemed a little more reasonable than the 257 00:13:01.400 --> 00:13:04.000  valuations in the US. Yeah, that makes a lot of sense and thank you 258 00:13:04.200 --> 00:13:07.900  for that. Yeah, and and I would call I would suggest that 259 00:13:07.900 --> 00:13:10.200  Emerging Markets are in a similar but 260 00:13:10.200 --> 00:13:14.300  different position right again a little more financially 261 00:13:13.300 --> 00:13:16.300  robust in terms of the underpinnings. 262 00:13:17.300 --> 00:13:20.100 Of those companies relative to where we've seen Cycles where people 263 00:13:20.100 --> 00:13:23.100  are risk off and and sort of beating down 264 00:13:23.100 --> 00:13:26.200  in price. I think anytime you have a lot of volatility people are 265 00:13:26.200 --> 00:13:29.700  hesitant to take a bunch of risk. So Emerging Markets 266 00:13:29.700 --> 00:13:32.800  could be a little more volatile as you would expect but 267 00:13:32.800 --> 00:13:35.100  I think from evaluation standpoint there's room to run 268 00:13:35.100 --> 00:13:38.600  as well over time relative to the US let's let's 269 00:13:38.600 --> 00:13:41.300  look at the other side of the coin and talk a 270 00:13:41.300 --> 00:13:44.500  little bit about bonds because that's been quite the Hot Topic lately. We've been 271 00:13:44.500 --> 00:13:47.900  getting a lot of inquiries from advisors and investors alike 272 00:13:47.900 --> 00:13:50.700  about the fixed income market. So give us 273 00:13:50.700 --> 00:13:52.300  a little perspective of what's happening in. 274 00:13:53.500 --> 00:13:57.300 Global fixed income right? Well, if you recall 2022 275 00:13:56.300 --> 00:13:59.500  was a historically bad year 276 00:13:59.500 --> 00:14:02.900  for Boston certainly, right as as fed as 277 00:14:02.900 --> 00:14:05.500  the FED raised interest rates are not just the FED but central banks 278 00:14:05.500 --> 00:14:08.500  essentially around the world except for the Asian 279 00:14:08.500 --> 00:14:11.100  China and Japan those central banks not quite 280 00:14:11.100 --> 00:14:14.600  as much but globally central banks at the 281 00:14:14.600 --> 00:14:17.600  impact of course of challenging the yield right 282 00:14:17.600 --> 00:14:20.900  and as we know yield in price or are sort of inverse Lee 283 00:14:20.900 --> 00:14:23.300  related and so as yield was pushed up by raising 284 00:14:23.300 --> 00:14:26.900  rates price came down and and it had a pretty dramatic 285 00:14:26.900 --> 00:14:29.900  impact across the yield curve 286 00:14:29.900 --> 00:14:32.400  and that was globally as well the United 287 00:14:32.400 --> 00:14:32.400  States. 288 00:14:33.200 --> 00:14:36.400 2022 pretty much a very bad. No good year for 289 00:14:36.400 --> 00:14:39.400  Bond holders rolling into the first quarter 290 00:14:39.400 --> 00:14:42.400  a lot of those same sort of macro dynamics that 291 00:14:42.400 --> 00:14:45.400  we talked about with equities was 292 00:14:45.400 --> 00:14:48.500  true to fix income as well the expectation the bond 293 00:14:48.500 --> 00:14:51.800  market pricing that they think the FED will essentially 294 00:14:51.800 --> 00:14:54.600  be done at some point this year raising rates 295 00:14:54.600 --> 00:14:58.100  had the impact of markets rallying 296 00:14:57.100 --> 00:15:01.300  to a degree and then of course when there 297 00:15:00.300 --> 00:15:04.100  was volatility injected because of banking issues 298 00:15:03.100 --> 00:15:07.300  you continued to see a pullback 299 00:15:06.300 --> 00:15:09.700  on the the yield 300 00:15:09.700 --> 00:15:13.000  right? So at at some points we saw for instance 301 00:15:12.200 --> 00:15:15.400  the the 10 year get up over four and we 302 00:15:15.400 --> 00:15:18.500  saw a pullback as yields come down then of course prices go 303 00:15:18.500 --> 00:15:21.400  up. And so you saw a nice robust kind of response over 304 00:15:21.400 --> 00:15:24.500  the first quarter of prices coming up for bonds that had 305 00:15:24.500 --> 00:15:27.500  the impact and that was true for treasuries and corporates 306 00:15:27.500 --> 00:15:30.400  and international bonds, right? So across the 307 00:15:30.400 --> 00:15:32.900  Spectrum you had sort of a nice performance. 308 00:15:33.300 --> 00:15:37.100 For bonds for the first quarter. And again, it's unusual 309 00:15:36.100 --> 00:15:39.400  for fixed income and Equity to look and 310 00:15:39.400 --> 00:15:42.100  behave very similarly. That was one of 311 00:15:42.100 --> 00:15:45.700  the things that was so unusual about 2022, but there's still 312 00:15:45.700 --> 00:15:48.500  sort of Behaving the same way based on the same Outlook 313 00:15:48.500 --> 00:15:51.500  that at some point interest rates stop going up 314 00:15:51.500 --> 00:15:54.500  or stop getting ratcheted up by central banks. 315 00:15:54.500 --> 00:15:57.100  And so that Dynamic is is kind of 316 00:15:57.100 --> 00:16:00.700  floating all the boats to this degree and so 317 00:16:00.700 --> 00:16:03.500  fixed income has had a robust first quarter. 318 00:16:04.400 --> 00:16:07.700 Remains to be seen how the rest of the year plays 319 00:16:07.700 --> 00:16:10.400  out and and you know, frankly we 320 00:16:10.400 --> 00:16:13.200  continued to see the a deep 321 00:16:13.200 --> 00:16:16.200  inversion in the yield curve, especially at the 322 00:16:16.200 --> 00:16:19.100  very shortest end of the O curve relative to the 323 00:16:19.100 --> 00:16:22.700  10 year. And as you know that has historically sort 324 00:16:22.700 --> 00:16:25.300  of been a warning sign of 325 00:16:25.300 --> 00:16:28.600  potential economic stress recessions right 326 00:16:28.600 --> 00:16:32.100  as an indicator and it has remained it 327 00:16:31.100 --> 00:16:34.100  inverted for some time now 328 00:16:34.100 --> 00:16:37.900  and that inversion has only gotten deeper on the shortest end. So, 329 00:16:37.900 --> 00:16:40.200  you know again you would want to continue 330 00:16:40.200 --> 00:16:43.700  to watch that and be cognizant of it. I think the takeaway 331 00:16:43.700 --> 00:16:46.500  from this is much like with equities. It's best 332 00:16:46.500 --> 00:16:49.200  to be sort of broad based Diversified. You never 333 00:16:49.200 --> 00:16:53.000  know what part of the Yoke curve is gonna move relative to this and 334 00:16:52.900 --> 00:16:56.800  it's good to have exposure 335 00:16:55.800 --> 00:16:58.600  not just us treasuries, but 336 00:16:58.600 --> 00:17:01.200  the corporates and not just us bonds, but the international 337 00:17:01.200 --> 00:17:04.300  bonds that there are benefits built into the pricing of all 338 00:17:04.900 --> 00:17:08.400 And as we start to see a decoupling of Central 339 00:17:07.400 --> 00:17:10.400  Bank activity, yes, they've been 340 00:17:10.400 --> 00:17:13.700  acting pretty much in concert, but at some point central banks 341 00:17:13.700 --> 00:17:16.800  start to peel off right and they get back to focusing on 342 00:17:16.800 --> 00:17:19.100  the handling kind of 343 00:17:19.100 --> 00:17:22.300  their domestic concerns. And as they do that it will 344 00:17:22.300 --> 00:17:25.600  have varying diversification impacts for bonds 345 00:17:25.600 --> 00:17:28.500  around the globe the way stocks and bonds behaves 346 00:17:28.500 --> 00:17:31.300  in 2022 with similar and then into this quarter. We're 347 00:17:31.300 --> 00:17:34.500  seeing some decent returns globally across those two 348 00:17:34.500 --> 00:17:37.800  macro asset classes. We're seeing 349 00:17:37.800 --> 00:17:40.300  some of a mixed bag that last Factor investors 350 00:17:40.300 --> 00:17:43.400  from a factor perspective, right? But let's 351 00:17:43.400 --> 00:17:46.200  shift a little bit and talk about factors for a moment. 352 00:17:46.200 --> 00:17:49.300  We're a factor investors are listeners The Avengers that 353 00:17:49.300 --> 00:17:52.300  we work with our have clients invested in 354 00:17:52.300 --> 00:17:55.500  these Factor portfolios. What did we see from a factor standpoint 355 00:17:55.500 --> 00:17:58.800  in the first quarter of 2023 if 356 00:17:58.800 --> 00:18:01.400  you think about the factor of value, it's just the the 357 00:18:01.400 --> 00:18:04.300  cheaper stocks outperform the more expensive stocks over time and as 358 00:18:04.300 --> 00:18:04.500  you know, 359 00:18:04.800 --> 00:18:07.800 We had a long run where that wasn't true. Right we're 360 00:18:07.800 --> 00:18:10.300  growth stocks were just outperforming value to the 361 00:18:10.300 --> 00:18:13.200  point that everybody was sort of Naval gazing wondering his value 362 00:18:13.200 --> 00:18:16.800  dead. Does this even make sense anymore? And and what 363 00:18:16.800 --> 00:18:19.400  we sort of looking at it determined was 364 00:18:19.400 --> 00:18:22.400  no actually values kind of in line with what it's always done. It's 365 00:18:22.400 --> 00:18:25.300  growth. That's so unusual. Yeah, right and that we're 366 00:18:25.300 --> 00:18:28.300  back to the story about the large tech stocks and get over evaluation. Right? 367 00:18:28.300 --> 00:18:31.900  And so last year was a great year for Value, right? Even 368 00:18:31.900 --> 00:18:34.500  though it was down right value outperform growth 369 00:18:34.500 --> 00:18:37.800  by a good 20% Oh, yeah, absolutely and it 370 00:18:37.800 --> 00:18:40.700  was sort of that Snapback to recognition of 371 00:18:40.700 --> 00:18:43.300  hey one of my paying for right and and these things 372 00:18:43.300 --> 00:18:46.200  have gotten incredibly overvalued on the 373 00:18:46.200 --> 00:18:46.600  growth side. 374 00:18:47.300 --> 00:18:50.500 And so it shouldn't come as a surprise then if there's a reversal of 375 00:18:50.500 --> 00:18:53.600  that Dynamic that value might underperform growth 376 00:18:53.600 --> 00:18:56.500  over the first quarter. And of course, that's what we observed right 377 00:18:56.500 --> 00:18:59.300  that value underperformed growth. It was 378 00:18:59.300 --> 00:19:02.300  those large kind of growthy names that took off and and so that 379 00:19:02.300 --> 00:19:05.700  that factor shows up and demonstrates 380 00:19:05.700 --> 00:19:08.300  that thighs right. So again kind of 381 00:19:08.300 --> 00:19:11.600  the academic research that smaller cap 382 00:19:11.600 --> 00:19:14.400  names tend to outperform larger cab 383 00:19:14.400 --> 00:19:17.800  names over time rolling into the first quarter large 384 00:19:17.800 --> 00:19:20.500  caps outperform small caps, right again being led 385 00:19:20.500 --> 00:19:23.500  by that large growthy and so small caps 386 00:19:23.500 --> 00:19:26.800  tended to underperform in general. What's interesting 387 00:19:26.800 --> 00:19:29.300  is across factor is 388 00:19:29.300 --> 00:19:32.300  one of the reasons you want to hold small caps isn't necessarily the size 389 00:19:32.300 --> 00:19:35.300  Factor premium associated with that because 390 00:19:35.300 --> 00:19:38.700  that's come under some scrutiny of 391 00:19:38.700 --> 00:19:41.400  Lee as academics kind of look at that. Say what 392 00:19:41.400 --> 00:19:42.200  do we actually getting here? 393 00:19:42.900 --> 00:19:46.000 But what really expresses itself 394 00:19:45.300 --> 00:19:48.500  in small camp names or all the other factors, right? So 395 00:19:48.500 --> 00:19:51.100  the reason you'd want to hold a small cap is not just 396 00:19:51.100 --> 00:19:54.200  because you get a benefit versus large caps, but because you get 397 00:19:54.200 --> 00:19:57.600  a really strong value signal a really strong momentum really 398 00:19:57.600 --> 00:20:00.200  strong quality, right all of these things. And so if we 399 00:20:00.200 --> 00:20:03.300  look at small caps the performance of small caps for 400 00:20:03.300 --> 00:20:06.700  the first quarter, you actually got to really strong quality signal 401 00:20:06.700 --> 00:20:09.700  in small caps. So again a reason 402 00:20:09.700 --> 00:20:12.400  why you want to have a multiple exposures for your 403 00:20:12.400 --> 00:20:15.400  factors not just pick any one of these right so small 404 00:20:15.400 --> 00:20:18.400  caps under form large caps, but quality did really well inside 405 00:20:18.400 --> 00:20:21.300  small camps that makes up the next category is 406 00:20:21.300 --> 00:20:24.400  momentum. And what's interesting about markets that are sort of 407 00:20:24.400 --> 00:20:27.500  whipsawing one way or the other that momentum tends to 408 00:20:27.500 --> 00:20:30.400  have a tougher time in markets where the signal is really 409 00:20:30.400 --> 00:20:33.100  hard to pick up where there's a lot of whipsawing effect up and down on the 410 00:20:33.100 --> 00:20:37.000  other way momentum tends to kind of get whipped around with that. 411 00:20:37.700 --> 00:20:40.200 Eventually when markets start to pick 412 00:20:40.200 --> 00:20:43.300  up Trend whether that's down for a significant period of 413 00:20:43.300 --> 00:20:46.500  time like in 2022 momentum does well or up right 414 00:20:46.500 --> 00:20:50.000  for a significant period of time and so you 415 00:20:49.200 --> 00:20:52.400  would expect momentum to kind 416 00:20:52.400 --> 00:20:55.400  of settle down as markets kind of settle down 417 00:20:55.400 --> 00:20:59.600  and we see less whipsawing and more directionality. However, and 418 00:20:59.600 --> 00:21:03.300  I mentioned it earlier with small caps quality this idea 419 00:21:02.300 --> 00:21:05.000  that there may be 420 00:21:05.200 --> 00:21:08.800  a flight to Quality in times when the 421 00:21:08.800 --> 00:21:11.100  there's a lot of volatility. Well one of the 422 00:21:11.100 --> 00:21:14.800  reasons you see that is because higher quality earnings tend to 423 00:21:14.800 --> 00:21:17.400  hold up better in downturns. They have a premium 424 00:21:17.400 --> 00:21:21.300  associated with them and we saw that very clearly quality 425 00:21:20.300 --> 00:21:23.200  was one of the areas that outperformed the market 426 00:21:23.200 --> 00:21:26.200  over the first quarter and that was true not just in the 427 00:21:26.200 --> 00:21:30.200  US but internationally as well interestingly in 428 00:21:29.200 --> 00:21:33.500  Emerging Markets value quality 429 00:21:32.500 --> 00:21:35.600  and low volatility did quite 430 00:21:35.600 --> 00:21:37.600  well so value was still doing well in emerging. 431 00:21:37.700 --> 00:21:40.700 Markets again a reason why you'd want to diversify 432 00:21:40.700 --> 00:21:43.400  your Factor exposures not just in the US but 433 00:21:43.400 --> 00:21:46.900  internationally as well and minimum volatility was 434 00:21:46.900 --> 00:21:49.800  a contributor in us but lagged Market 435 00:21:49.800 --> 00:21:52.500  beta on the whole a broadly 436 00:21:52.500 --> 00:21:55.900  Diversified Factor exposure was I'd 437 00:21:55.900 --> 00:21:58.700  say depending on what your tilts are helpful on 438 00:21:58.700 --> 00:22:02.200  the downside when Market was volatile, but lagged 439 00:22:01.200 --> 00:22:04.900  Market beta to a degree for the 440 00:22:04.900 --> 00:22:07.500  first quarter where it outperformed in 441 00:22:07.500 --> 00:22:10.400  2022. So again factors are a 442 00:22:10.400 --> 00:22:13.500  long term investment. You wouldn't do it on based 443 00:22:13.500 --> 00:22:16.700  on one quarter, but we we watch the horse race, right? Yeah. 444 00:22:16.700 --> 00:22:19.200  Absolutely and I think a point that you 445 00:22:19.200 --> 00:22:22.400  you said that really resonated with me is the notion of how these factors work 446 00:22:22.400 --> 00:22:25.800  together right size and quality you mentioned 447 00:22:25.800 --> 00:22:29.200  and so having a diverse portfolio 448 00:22:28.200 --> 00:22:30.700  of integrated factors. 449 00:22:31.500 --> 00:22:32.800 maintaining that for the long term 450 00:22:34.200 --> 00:22:37.400 Should reward you over the long term. Yeah, and that's the 451 00:22:37.400 --> 00:22:40.800  expectation. There are lots of factors out 452 00:22:40.800 --> 00:22:43.800  there that have been identified in the academic literature when you 453 00:22:43.800 --> 00:22:46.400  selectively go out and pick a handful of 454 00:22:46.400 --> 00:22:49.500  those factors. The expectation is every single 455 00:22:49.500 --> 00:22:52.500  one of those is going to be a positive contributor to 456 00:22:52.500 --> 00:22:55.400  your portfolio over time, right you you 457 00:22:55.400 --> 00:22:58.300  wouldn't necessarily pick one that you thought. Well, it's gonna be a loser but we're gonna hold on 458 00:22:58.300 --> 00:23:01.100  to it, right you're picking all of these different factors of the 459 00:23:01.100 --> 00:23:04.700  expectation that each one of those is going to be a 460 00:23:04.700 --> 00:23:07.300  positive contributor over a period of time when you 461 00:23:07.300 --> 00:23:10.400  weave them together you sort of iron out 462 00:23:10.400 --> 00:23:13.400  the highs and lows of any one particular factor and 463 00:23:13.400 --> 00:23:17.100  you get that very nice steady stream of 464 00:23:16.100 --> 00:23:19.500  return into your 465 00:23:19.500 --> 00:23:22.300  portfolio. That's generated by those Factor exposures. Yeah. 466 00:23:22.300 --> 00:23:25.400  It's the old the old adage we're going for singles and doubles 467 00:23:25.400 --> 00:23:28.200  not home runs, right? Yeah. Yeah exactly. So let's 468 00:23:28.200 --> 00:23:31.200  talk a little bit about factors and fixed income and then 469 00:23:31.200 --> 00:23:34.100  we can take a look at some of the the factors overseas. 470 00:23:34.100 --> 00:23:37.800 As well, but I do want to spend some time on some of 471 00:23:37.800 --> 00:23:40.100  the headlines. So why don't we 472 00:23:40.100 --> 00:23:44.000  talk a little bit about us fixed income factors? Sure. So 473 00:23:43.600 --> 00:23:46.200  as you know, right fat factors are 474 00:23:46.200 --> 00:23:49.800  not an equity only thing. In fact, we see factors across 475 00:23:49.800 --> 00:23:53.600  all different kinds of assets fixed income Commodities 476 00:23:52.600 --> 00:23:55.400  housing real 477 00:23:55.400 --> 00:23:58.400  estate, right all these I the concept of value for 478 00:23:58.400 --> 00:24:01.500  instance and the concept of momentum right anything that has a price associated 479 00:24:01.500 --> 00:24:04.400  with it stores can demonstrate these sort of 480 00:24:04.400 --> 00:24:07.200  factors. And that's true. In fact fixed income the way we 481 00:24:07.200 --> 00:24:10.400  think about factors and fixed incomes specifically is is kind 482 00:24:10.400 --> 00:24:13.400  of interest rate risk, which is time, right? So think 483 00:24:13.400 --> 00:24:17.300  about what we talked about with the yield curve inversion 484 00:24:16.300 --> 00:24:19.400  and what was going on on the short end versus the 485 00:24:19.400 --> 00:24:23.500  long end what we've observed in the 486 00:24:23.500 --> 00:24:26.200  past. Let's call year was a really 487 00:24:26.200 --> 00:24:29.800  strong interest rate risk lack 488 00:24:29.800 --> 00:24:32.600  of benefit that you got for sort of being paid 489 00:24:32.600 --> 00:24:34.000  over time, right? 490 00:24:34.100 --> 00:24:38.300 And in theory, right you should get paid to hold 491 00:24:37.300 --> 00:24:41.100  over time because there's less certainty 492 00:24:40.100 --> 00:24:43.500  about what the future holds so you demand a 493 00:24:43.500 --> 00:24:46.800  premium to hold something over time to lend over time. And 494 00:24:46.800 --> 00:24:49.200  so when you have the short end 495 00:24:49.200 --> 00:24:52.500  of the curve come up that tends to impact that interest 496 00:24:52.500 --> 00:24:55.500  rate sets that risk that sensitivity because you're 497 00:24:55.500 --> 00:24:58.800  not getting paid over time. You're getting paid actually on the 498 00:24:58.800 --> 00:25:01.700  the shorter end potentially. So when you 499 00:25:01.700 --> 00:25:04.800  see a pullback of rates, 500 00:25:04.800 --> 00:25:07.700  right and price is going up you're seeing 501 00:25:07.700 --> 00:25:10.800  that benefit playing out through the first quarter as well credit risk 502 00:25:10.800 --> 00:25:13.300  is just the difference the buildup over 503 00:25:13.300 --> 00:25:16.300  the risk free rate treasuries to account 504 00:25:16.300 --> 00:25:19.200  for hey, you know a corporation has more risk than a government 505 00:25:19.200 --> 00:25:22.500  and I should be paid that difference. And so you're investing 506 00:25:22.500 --> 00:25:25.200  up and down the various yield curves that 507 00:25:25.200 --> 00:25:28.900  build up on that and in this case credit risk really as 508 00:25:28.900 --> 00:25:31.900  a factor wasn't a very solid contributor 509 00:25:31.900 --> 00:25:33.200  for the first quarter slightly positive. 510 00:25:34.100 --> 00:25:37.200 The the show really has been frankly for the 511 00:25:37.200 --> 00:25:40.500  past 18 months were interest rate risk is in 512 00:25:40.500 --> 00:25:43.500  terms of factor Premia in your portfolios. 513 00:25:43.500 --> 00:25:46.500  And then Market is is again just Market 514 00:25:46.500 --> 00:25:49.800  beta which is a buildup of all these different factors expressing themselves. 515 00:25:49.800 --> 00:25:53.200  So on the whole positive Bond performance 516 00:25:52.200 --> 00:25:55.500  being driven by changes to 517 00:25:55.500 --> 00:25:59.500  the the yield curve in many cases and some 518 00:25:58.500 --> 00:26:01.400  expectation that Bond markets are looking ahead 519 00:26:01.400 --> 00:26:04.600  and pricing for a cessation of rate raises 520 00:26:04.600 --> 00:26:07.500  by central banks. So so my expectation would 521 00:26:07.500 --> 00:26:10.200  be for for fixed income investors again much like 522 00:26:10.200 --> 00:26:13.400  Equity potentially more volatility here, right? The 523 00:26:13.400 --> 00:26:16.400  the rodeo is not over the big bull riding 524 00:26:16.400 --> 00:26:18.200  could yet be to come so 525 00:26:19.200 --> 00:26:22.400 You know stay patient the the benefit here is 526 00:26:22.400 --> 00:26:25.400  there's return associated with fixed income 527 00:26:25.400 --> 00:26:29.500  to a degree. We haven't seen in 15 years. And so 528 00:26:29.500 --> 00:26:32.700  let this play out. And again, these Factor 529 00:26:32.700 --> 00:26:35.600  exposures are the expectation is over time. These are 530 00:26:35.600 --> 00:26:38.100  going to be a additive to the returns that you 531 00:26:38.100 --> 00:26:40.700  get from the bond market you had mentioned this in some of your previous comments. 532 00:26:42.500 --> 00:26:45.400 Factors perform differently geographically too 533 00:26:45.400 --> 00:26:48.500  right like value in the US might give you a different return 534 00:26:48.500 --> 00:26:51.300  versus value and the international develop during the 535 00:26:51.300 --> 00:26:54.500  Emerging Markets Arenas. So I think there's diversification story 536 00:26:54.500 --> 00:26:57.600  there. Can you comment on that, please? Yeah. Well, yes, of 537 00:26:57.600 --> 00:27:00.100  course and and I sort of made a comment 538 00:27:00.100 --> 00:27:01.300  about as 539 00:27:02.300 --> 00:27:05.500 central banks become decoupled and start to operate a 540 00:27:05.500 --> 00:27:09.000  little more independently that it has an impact on the 541 00:27:11.300 --> 00:27:14.600 local economies in all of these different markets as 542 00:27:14.600 --> 00:27:17.200  an impact on their currencies. And so 543 00:27:17.200 --> 00:27:20.600  when you think about fixed income the benefit that you get from 544 00:27:20.600 --> 00:27:23.300  not only where you hold on 545 00:27:23.300 --> 00:27:26.500  the curve and and the amount of credit that you're willing but that 546 00:27:26.500 --> 00:27:29.900  you're going to diversify the various curves 547 00:27:29.900 --> 00:27:32.300  that you hold and the where you 548 00:27:32.300 --> 00:27:35.900  are on that across geographies and 549 00:27:35.900 --> 00:27:38.200  then take into account the impact that 550 00:27:38.200 --> 00:27:42.200  currencies might have right and so we know for equities 551 00:27:41.200 --> 00:27:45.100  the the volatility signature 552 00:27:44.100 --> 00:27:47.100  of equity is is so robust that 553 00:27:47.100 --> 00:27:50.600  you're you tend to be willing to hold the volatility of 554 00:27:50.600 --> 00:27:53.900  fluctuations and currency in in 555 00:27:53.900 --> 00:27:56.000  fixed income. It tends not to pay you to do 556 00:27:56.200 --> 00:27:59.400  that. And so I know for instance 557 00:27:59.400 --> 00:28:03.100  that here at Cemetery you folks hedge back 558 00:28:03.100 --> 00:28:07.000  to the dollar sure and that takes some of that volatility out, 559 00:28:06.600 --> 00:28:09.400  right? And again, I think that's a benefit 560 00:28:09.400 --> 00:28:11.000  for Factor investors because what you're 561 00:28:11.200 --> 00:28:14.300 Is less volatility associated with fluctuations currency and 562 00:28:14.300 --> 00:28:18.000  you're getting maybe stronger signal from these these 563 00:28:17.200 --> 00:28:20.900  different sources of return across 564 00:28:20.900 --> 00:28:23.400  different markets and they're all going to be hitting at 565 00:28:23.400 --> 00:28:26.700  different times. Once the sort of the global economy 566 00:28:26.700 --> 00:28:29.200  comes unpegged to what's going 567 00:28:29.200 --> 00:28:33.100  on fighting inflation. Yeah until I think it's a perfect diversification story 568 00:28:32.100 --> 00:28:33.300  and 569 00:28:34.100 --> 00:28:37.600 we have a saying here that the only free lunch and investing is diversification. And 570 00:28:37.600 --> 00:28:40.900  so we tout that investor should be embracing that Casey. 571 00:28:40.900 --> 00:28:43.400  Thank you so much for joining us that concludes part one. 572 00:28:43.400 --> 00:28:46.600  Please feel free to access other podcasts 573 00:28:46.600 --> 00:28:49.000  that we have done and they can be 574 00:28:49.400 --> 00:28:52.600  accessed anywhere you get your podcast. So please join Casey and 575 00:28:52.600 --> 00:28:56.000  I for part two and our next series symmetry Partners 576 00:28:55.700 --> 00:28:58.800  LLC is an investment advisor firm 577 00:28:58.800 --> 00:29:01.700  registered with the Securities and Exchange Commission The 578 00:29:01.700 --> 00:29:04.600  Firm only transacts business in states where it 579 00:29:04.600 --> 00:29:07.500  is properly registered or excluded or 580 00:29:07.500 --> 00:29:11.200  Exempted from registration requirements registration of 581 00:29:10.200 --> 00:29:13.600  an investment advisor does not imply any 582 00:29:13.600 --> 00:29:16.400  specific level of skill or training and does 583 00:29:16.400 --> 00:29:19.100  not constitute an endorsement of the firm by the 584 00:29:19.100 --> 00:29:22.300  commission. No one should assume that future performance of any 585 00:29:22.300 --> 00:29:26.300  specific investment investment strategy product or 586 00:29:25.300 --> 00:29:28.300  non-investment related content made 587 00:29:28.300 --> 00:29:31.800  reference to directly or indirectly in this material will be 588 00:29:31.800 --> 00:29:32.400  profitable. 589 00:29:33.400 --> 00:29:36.500 As with any investment strategy there is the possibility of 590 00:29:36.500 --> 00:29:39.500  profitability as well as loss due 591 00:29:39.500 --> 00:29:42.300  to various factors including changing market 592 00:29:42.300 --> 00:29:44.700  conditions and/or applicable laws. 593 00:29:45.300 --> 00:29:48.900 The content may not be reflective of current opinions or 594 00:29:48.900 --> 00:29:51.600  positions. Please note the material 595 00:29:51.600 --> 00:29:54.300  is provided for educational and background use only 596 00:29:54.300 --> 00:29:58.000  moreover. 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Not all financial advisors are created equally. Some have certified credentials, some charge their clients fees, and others may get paid on commission (if they offer investment products). In part two of this podcast episode, our own Tom Romano, Head of Strategic Relationships and Product Development, is joined by Symmetry's Michael Storer, Senior Regional Director, and a financial advisor from our sister firm, Apella Wealth, Peter Leppones, CFP®, to discuss the important credentials of, and differences between, financial advisors.  If you have any questions or would like more information, reach out to us at https://symmetrypartners.com/contact-us/ You can also find us on Facebook, YouTube, Twitter, and LinkedIn. As always, we remain invested in your goals. Symmetry Partners, LLC, is an investment advisory firm registered with the Securities and Exchange Commission. The firm only transacts business in states where it is properly registered, excluded or exempted from registration requirements. Registration of an investment adviser does not imply any specific level of skill or training and does not constitute an endorsement of the firm by the Commission. No one should assume that future performance of any specific investment, investment strategy, product or non-investment related content made reference to directly or indirectly in this material will be profitable. As with any investment strategy, there is the possibility of profitability as well as loss. Due to various factors, including changing market conditions and/or applicable laws, the content may not be reflective of current opinions or positions.   Please note the material is provided for educational and background use only. Moreover, you should not assume that any discussion or information contained in this material serves as the receipt of, or as a substitute for, personalized investment advice. Transcript: 0 00:00:01.900 --> 00:00:07.500 Welcome back 1 00:00:07.500 --> 00:00:10.500  to part 2 of choosing the right financial advisor. This 2 00:00:10.500 --> 00:00:13.100  is Tom Romano with unfiltered finance and I'm back 3 00:00:13.100 --> 00:00:16.200  here with my guests. Mike store senior Regional director at 4 00:00:16.200 --> 00:00:20.000  symmetry partners and Peter laponis financial advisor 5 00:00:19.200 --> 00:00:22.200  and cfp at Apollo wealth. Thank you for joining us 6 00:00:22.200 --> 00:00:25.400  gentlemen, so go Peter certified financial 7 00:00:25.400 --> 00:00:28.400  planner see FP Mike. I'm 8 00:00:28.400 --> 00:00:31.800  asked this question to you because Peter is a cfp. What 9 00:00:31.800 --> 00:00:34.700  are the credential what other credentials that investors should 10 00:00:34.700 --> 00:00:37.200  be looking for as they're going through this process of choosing a 11 00:00:37.200 --> 00:00:40.500  financial advisor. I mean cfp certainly is one of them sure. There's 12 00:00:40.500 --> 00:00:43.200  you know, I mean I come across a wide variety 13 00:00:43.200 --> 00:00:47.500  of different advisors and that have different different designations 14 00:00:46.500 --> 00:00:49.300  and it and sometimes it 15 00:00:49.300 --> 00:00:52.400  depends on it depends on you know, what type 16 00:00:52.400 --> 00:00:56.400  of work they're doing for the client. It may not always be, you know 17 00:00:56.400 --> 00:00:59.400  cfp, but most of the advisors that I'm working with their 18 00:00:59.400 --> 00:01:01.500  certified financial planners, but there's 19 00:01:01.900 --> 00:01:05.000 there's SEMA, you know, which is a certified Investment 20 00:01:04.500 --> 00:01:07.800  Management associate, I 21 00:01:07.800 --> 00:01:10.500  believe and that I look 22 00:01:10.500 --> 00:01:13.500  at CFA and see Sima as kind of two different 23 00:01:13.500 --> 00:01:14.300  designations that 24 00:01:15.500 --> 00:01:18.200 Are are very strong. I mean these people are incredibly smart. 25 00:01:18.200 --> 00:01:21.700  They pass a lot of tests to get where they are. But I 26 00:01:21.700 --> 00:01:24.500  look at the see the SEMA and the 27 00:01:24.500 --> 00:01:27.300  the CFA which is a chartered financial 28 00:01:27.300 --> 00:01:31.100  analyst as more geared towards Investments to 29 00:01:30.100 --> 00:01:33.300  a certain extent. So they're if you've 30 00:01:33.300 --> 00:01:37.000  got an advisor that is more seamors or CFA oriented. 31 00:01:36.500 --> 00:01:40.300  I think you're probably you could and Peter 32 00:01:39.300 --> 00:01:42.900  you can correct me if I'm wrong lean more 33 00:01:42.900 --> 00:01:45.800  towards them probably approaching it from an investment perspective. 34 00:01:45.800 --> 00:01:49.100  Whereas I think a cfp is 35 00:01:48.100 --> 00:01:52.100  going to approach the relationship from everything 36 00:01:51.100 --> 00:01:54.400  that Peter just talked about in terms of how they 37 00:01:54.400 --> 00:01:57.200  want to how they want to work with you moving 38 00:01:57.200 --> 00:02:00.300  forward Investments are important no doubt, but I think from 39 00:02:00.300 --> 00:02:03.700  the standpoint of the approach if 40 00:02:03.700 --> 00:02:06.200  you're looking for a planner, you know a cfp is 41 00:02:06.200 --> 00:02:10.000  where you want to be if you want someone that's more focused on. Okay, I'll construct 42 00:02:09.300 --> 00:02:12.800  a portfolio for you, but I think Sima and 43 00:02:12.800 --> 00:02:15.300  CFA tend to lose tend to 44 00:02:15.400 --> 00:02:18.200 Themselves more towards investment only to a certain 45 00:02:18.200 --> 00:02:21.400  extent now that's not every single or CFA but I think from that 46 00:02:21.400 --> 00:02:24.400  perspective those types of designations. Those are the ones that I come across 47 00:02:24.400 --> 00:02:27.700  primarily obviously, there's other designations with 48 00:02:27.700 --> 00:02:30.400  the insurance realm that you know, you like a 49 00:02:30.400 --> 00:02:33.200  chfc that would be which I 50 00:02:33.200 --> 00:02:36.400  I don't even remember that. It's a chartered leave its chartered Financial 51 00:02:36.400 --> 00:02:39.700  consult consultant, right which is different than a chartered financial analyst 52 00:02:39.700 --> 00:02:42.400  which is kind of interesting but you know, they'd be focused more on 53 00:02:42.400 --> 00:02:45.500  and probably the insurance side of the investment process. 54 00:02:45.500 --> 00:02:48.200  So I come across a lot but I would say 55 00:02:48.200 --> 00:02:51.900  that I feel comfortable saying it that the 56 00:02:51.900 --> 00:02:55.400  cfp is the designation where you know, mostly you're 57 00:02:55.400 --> 00:02:58.600  going to be getting more of a planning approach. Whereas I 58 00:02:58.600 --> 00:03:02.200  think the other designations might lean towards something else within 59 00:03:01.200 --> 00:03:04.700  the whole scope of planning but more, 60 00:03:04.700 --> 00:03:07.100  you know designated or specific on that 61 00:03:07.100 --> 00:03:11.000  side sure. I think it's important, you know, individuals professionals 62 00:03:10.500 --> 00:03:14.000  regardless of the industry having credentials after 63 00:03:13.400 --> 00:03:15.400  their name shows that they're 64 00:03:15.400 --> 00:03:18.600 to the business. They're probably lifelong Learners, 65 00:03:18.600 --> 00:03:23.000  which is something you probably want to look for in a financial advisor. And 66 00:03:21.200 --> 00:03:25.300  I would agree with you a cfp 67 00:03:24.300 --> 00:03:27.600  is probably the starting point. However, the 68 00:03:27.600 --> 00:03:31.000  the SEMA the Cima in the CFA, 69 00:03:30.200 --> 00:03:33.900  which I would agree are more investment driven. 70 00:03:35.700 --> 00:03:38.100 Um working with a firm who has a cfp has the point 71 00:03:38.100 --> 00:03:41.300  of contact Peter, but that doesn't mean you don't have access to 72 00:03:41.300 --> 00:03:44.500  cfa's and seamas as well. Right, correct. And 73 00:03:44.500 --> 00:03:47.500  that's that's part of the teamwork approach here that you 74 00:03:47.500 --> 00:03:51.200  know behind the scenes. I know that there's cfas working on our portfolios. 75 00:03:50.200 --> 00:03:53.100  So so I think 76 00:03:53.100 --> 00:03:57.500  you could see someone with another non-cfp designation 77 00:03:57.500 --> 00:04:00.200  but is what's their firm like do they have a team behind 78 00:04:00.200 --> 00:04:04.100  them is maybe they have a a young hire 79 00:04:03.100 --> 00:04:06.700  a new hire coming out of college who's studying 80 00:04:06.700 --> 00:04:09.200  for his or her cfp and that's their parent plan 81 00:04:09.200 --> 00:04:12.600  who works on the financial plan. So I mean to I think 82 00:04:12.600 --> 00:04:15.300  you might be doing a disservice just because 83 00:04:15.300 --> 00:04:18.400  someone doesn't have cfp understand more about what's 84 00:04:18.400 --> 00:04:21.200  what's going on at the firm and not just 85 00:04:21.200 --> 00:04:25.100  the designation. But I do agree having a designation and you 86 00:04:24.100 --> 00:04:28.400  made you reminded me. My continuing 87 00:04:27.400 --> 00:04:30.500  ed is coming up and it's it's comprehensive. I've 88 00:04:30.500 --> 00:04:34.000  got I've got a lot to do several hours to to 89 00:04:33.000 --> 00:04:34.100  keep 90 00:04:34.600 --> 00:04:37.500 Cfp designation current I've 91 00:04:37.500 --> 00:04:40.800  got to do some continuing education requirements online. Yeah, me 92 00:04:40.800 --> 00:04:43.100  too. Thanks for the reminder. I would say I didn't 93 00:04:43.100 --> 00:04:46.300  mean to say that, you know, the cfp is definitely starting point. But Peter 94 00:04:46.300 --> 00:04:49.800  brings up a great point that you when you visit with these cfps. They 95 00:04:49.800 --> 00:04:50.800  do have those other. 96 00:04:51.600 --> 00:04:54.400 People in their organizations that cover those parts 97 00:04:54.400 --> 00:04:57.200  of the planning process for them from that standpoint 98 00:04:57.200 --> 00:05:00.200  So and I've met many cfps that have their SEMA or have their CFA as 99 00:05:00.200 --> 00:05:03.400  well. So depends on who I'm speaking with, but there's there's a 100 00:05:03.400 --> 00:05:06.400  wide variety of different designations and some have won 101 00:05:06.400 --> 00:05:10.000  some have many or some have, you know, more than one right? So something 102 00:05:09.200 --> 00:05:12.400  that you would recommend investors look for as they're gonna 103 00:05:12.400 --> 00:05:15.200  go through absolutely. Absolutely. Absolutely. Yeah Mike we 104 00:05:15.200 --> 00:05:18.100  for all the cfps out there yet. We're definitely the top 105 00:05:18.100 --> 00:05:21.200  designation. No doubt about no doubt about it. We can 106 00:05:21.200 --> 00:05:25.900  leave it at that. Very good very good. So I 107 00:05:25.900 --> 00:05:28.500  have a few more questions and this has been great gentlemen, but 108 00:05:29.700 --> 00:05:32.800 What are some of the resources online resources 109 00:05:32.800 --> 00:05:35.400  right, you know, I don't think people use phone books 110 00:05:35.400 --> 00:05:39.100  anymore to find Financial professionals. What are 111 00:05:38.100 --> 00:05:41.100  some of the things my gear you're working 112 00:05:41.100 --> 00:05:44.000  with thousands of advisors. Like how do you how do you 113 00:05:44.100 --> 00:05:47.200  go about and find an advisor that that you would want to work with 114 00:05:47.200 --> 00:05:50.600  a professional level but not only professional of 115 00:05:50.600 --> 00:05:53.900  us person maybe from even personal standpoint where can 116 00:05:53.900 --> 00:05:56.300  investors go? Well they can they can you 117 00:05:56.300 --> 00:05:59.800  know go online and you know, there's a couple of different organizations that 118 00:05:59.800 --> 00:06:02.700  are out there that you could look at like the Financial Planning Association is 119 00:06:02.700 --> 00:06:05.600  a great place to start that's that's a 120 00:06:05.600 --> 00:06:08.600  big one National Association of 121 00:06:08.600 --> 00:06:11.800  personal financial advisors is another great site 122 00:06:11.800 --> 00:06:14.600  as well the certified financial planner 123 00:06:14.600 --> 00:06:17.100  board. You can go that route as well. I mean, 124 00:06:17.100 --> 00:06:20.400  that's probably the best place to start you can find someone in your general area 125 00:06:20.400 --> 00:06:23.100  that could help you there. There's another firm out there 126 00:06:23.100 --> 00:06:26.600  XY Planning Network which is which 127 00:06:26.600 --> 00:06:29.300  is a pretty good tool for to search for fee only. 128 00:06:29.700 --> 00:06:32.200 Financial advisors you mentioned, you know 129 00:06:32.200 --> 00:06:35.200  word of mouth or referrals from from your friends 130 00:06:35.200 --> 00:06:38.200  or family that may be working with a financial advisor. So all of 131 00:06:38.200 --> 00:06:41.100  them are great great ways to to identify some of 132 00:06:41.100 --> 00:06:44.300  that you might want to work with at least get the opportunity to interview them to see 133 00:06:44.300 --> 00:06:47.700  if they would be a good fit for you. Yeah. I think there's a lot of great resources online, 134 00:06:47.700 --> 00:06:50.500  you know, one of the things that Peter and 135 00:06:50.500 --> 00:06:53.500  I talk about quite a bit is you know working with someone 136 00:06:53.500 --> 00:06:56.200  who understands you someone who's working with 137 00:06:56.200 --> 00:06:58.600  other investors like me. 138 00:06:59.300 --> 00:07:02.900 Right in a lot of times if someone has a very specific need or 139 00:07:02.900 --> 00:07:05.500  specific sort of outcome. They're 140 00:07:05.500 --> 00:07:08.800  looking for they can identify the right Financial professional 141 00:07:08.800 --> 00:07:11.200  by not only looking at those websites, but 142 00:07:12.200 --> 00:07:15.100 LinkedIn Facebook. Look, who are these? 143 00:07:15.100 --> 00:07:18.300  Look who at the who these advisors are look at 144 00:07:18.300 --> 00:07:21.500  the circles that they're in right? You know it a funny story my parents 145 00:07:21.500 --> 00:07:24.200  who are not great investors. They were 146 00:07:24.200 --> 00:07:27.400  both School teachers had a pension but when they were looking for 147 00:07:27.400 --> 00:07:30.400  financial advisor, they didn't look any 148 00:07:30.400 --> 00:07:33.700  further than you know, the Connecticut Teachers Retirement Financial 149 00:07:33.700 --> 00:07:36.400  advisory. It was a really long name like 150 00:07:36.400 --> 00:07:39.500  that. I know I'm butchering it and talking it right but they will 151 00:07:39.500 --> 00:07:42.600  work Connecticut Teachers that must be the guy that we work with without even 152 00:07:42.600 --> 00:07:45.800  thinking twice about it, but they knew they felt comfortable and 153 00:07:45.800 --> 00:07:48.500  they trusted that the this particular individuals working 154 00:07:48.500 --> 00:07:49.900  with other, Connecticut Teachers. 155 00:07:50.800 --> 00:07:53.400 Here to add to any of that Peter. I mean, I think that 156 00:07:53.400 --> 00:07:56.400  you know, I've had done. Oh my 157 00:07:56.400 --> 00:07:57.600  second cap. We have pulled that one back. 158 00:07:58.300 --> 00:07:59.300 I won't ask that question better. 159 00:08:00.300 --> 00:08:00.300 All right. 160 00:08:04.500 --> 00:08:05.500 so Peter 161 00:08:06.900 --> 00:08:09.200 You know, I've talked about this it it's a mutual 162 00:08:09.200 --> 00:08:12.400  interview between an advisor and an investor the investors making 163 00:08:12.400 --> 00:08:16.000  a choice, but the advisors making a choice as well. So talk 164 00:08:15.200 --> 00:08:17.800  a little bit about that process if you will. 165 00:08:18.400 --> 00:08:21.700 Yeah, I think that's that's a great question. And I definitely 166 00:08:21.700 --> 00:08:24.300  encourage people to come up with a 167 00:08:24.300 --> 00:08:28.000  list of questions and interview multiple 168 00:08:27.500 --> 00:08:30.200  advisors definitely. But yeah, when when 169 00:08:30.200 --> 00:08:33.500  I'm meeting with with a New Prospect, I'm interviewing 170 00:08:33.500 --> 00:08:36.700  them as well. And there's things I'm I'm looking 171 00:08:36.700 --> 00:08:39.900  for I want to make sure that number 172 00:08:39.900 --> 00:08:43.600  one there. They're gonna be happy working with us. I've 173 00:08:42.600 --> 00:08:45.500  told people who I refer to 174 00:08:45.500 --> 00:08:48.000  them as Gunslingers. They want to pick stocks. They want to 175 00:08:48.100 --> 00:08:51.500  be in and out of the market they want they want action and I've told 176 00:08:51.500 --> 00:08:54.800  people I go I don't think we're gonna be a good fit. I'm a 177 00:08:54.800 --> 00:08:57.000  nice person. You seem like a nice person you seem to get along but 178 00:08:57.800 --> 00:09:00.300 we're going to have different philosophies and and I want 179 00:09:00.300 --> 00:09:03.200  you to be happy and I don't want to waste your time and I 180 00:09:03.200 --> 00:09:06.200  don't want to have my time wasted and so I've had to tell people I just don't think 181 00:09:06.200 --> 00:09:09.800  that this is necessarily going to work. Um, also there's 182 00:09:09.800 --> 00:09:12.300  when I start to hear people talk and I say this 183 00:09:12.300 --> 00:09:12.800  to clients 184 00:09:13.500 --> 00:09:16.600 and Prospects I start to get a gut feeling about what's 185 00:09:16.600 --> 00:09:19.400  going on. And when I start to hear about things like 186 00:09:19.400 --> 00:09:22.300  well a lot of debt, you know, you've got 187 00:09:22.300 --> 00:09:25.600  and not good. You don't have good financial habits. 188 00:09:25.600 --> 00:09:28.300  You're spending all your money. You've got 189 00:09:28.300 --> 00:09:31.200  a lot of debt a lot of bad debt. It's one thing to have a mortgage your car 190 00:09:31.200 --> 00:09:34.100  payments. Those are those are necessary. We'll call those 191 00:09:34.100 --> 00:09:38.200  good debt necessary debt. We start talking about large student 192 00:09:37.200 --> 00:09:40.500  loans. We start talking about large credit 193 00:09:40.500 --> 00:09:41.300  card balances. 194 00:09:42.500 --> 00:09:45.900 I may not be able to work with you. I you may be better off going 195 00:09:45.900 --> 00:09:49.600  and having credit counseling done first because I 196 00:09:48.600 --> 00:09:52.000  can maybe give you some pointers but I've 197 00:09:51.100 --> 00:09:54.400  had to unfortunately tell people that we may 198 00:09:54.400 --> 00:09:57.600  not be a good fit. There wasn't a whole lot I could do because they 199 00:09:57.600 --> 00:10:00.700  just they just didn't have the assets. They needed to get really the 200 00:10:00.700 --> 00:10:03.400  basics of their budgeting or spending plan 201 00:10:03.400 --> 00:10:06.600  down and start to work on that debt. And that's not something we're 202 00:10:06.600 --> 00:10:07.000  necessarily. 203 00:10:08.500 --> 00:10:11.600 Working on it'd be more of sort of a credit agency 204 00:10:11.600 --> 00:10:14.600  helping them to kind of get that square away. Absolutely. You 205 00:10:14.600 --> 00:10:17.500  mentioned working with, you know, other sort of 206 00:10:17.500 --> 00:10:20.200  financial professionals that you you work with 207 00:10:20.200 --> 00:10:20.400  other. 208 00:10:21.500 --> 00:10:25.400 Financial professionals as well. I mean maybe not direct financial 209 00:10:25.400 --> 00:10:28.400  advisors, but tax advisors and things like that. Oh, definitely. 210 00:10:28.400 --> 00:10:31.400  I like to say that the analogy is I'm 211 00:10:31.400 --> 00:10:34.600  I'm sort of the quarterback or I'm your 212 00:10:34.600 --> 00:10:37.700  your primary care physician if we need to bring in a specialist, 213 00:10:37.700 --> 00:10:40.300  you know cardiologists so forth 214 00:10:40.300 --> 00:10:41.900  weekologists. 215 00:10:44.400 --> 00:10:46.100 So but I'm working with. 216 00:10:47.200 --> 00:10:50.300 I'll work with the client's attorney to talk about their state plan 217 00:10:50.300 --> 00:10:54.500  work with a client's accountant or CPA to 218 00:10:54.500 --> 00:10:57.500  talk about if we need to do some rebalancing in the portfolio before 219 00:10:57.500 --> 00:10:59.200  I do any of that. 220 00:11:00.200 --> 00:11:04.000 And start triggering capital gains. I want to make sure that the accountant is 221 00:11:03.400 --> 00:11:06.400  on board with it and we understand what the 222 00:11:06.400 --> 00:11:09.500  ramifications are of those actions or in 223 00:11:09.500 --> 00:11:12.800  actions because the last thing a client wants is a 224 00:11:12.800 --> 00:11:15.800  surprise attack time. There's something psychological about 225 00:11:15.800 --> 00:11:18.700  a big tax bill staring you in the face and it's 226 00:11:18.700 --> 00:11:21.100  one thing to not know about it and have to 227 00:11:21.100 --> 00:11:24.200  pay it. It's another thing. All right, you know what we knew about this, but we know why we 228 00:11:24.200 --> 00:11:27.300  did it. So I'm constantly working with 229 00:11:27.300 --> 00:11:30.900  with other Professionals in helping clients 230 00:11:30.900 --> 00:11:32.800  with taxes and in legal issues. 231 00:11:33.700 --> 00:11:36.300 That's fantastic. Yeah, so that's another thing that investors should 232 00:11:36.300 --> 00:11:39.100  be looking for. Is there a true team approach? Maybe not even under the 233 00:11:39.100 --> 00:11:42.700  same roof under the same corporate umbrella if you will but making 234 00:11:42.700 --> 00:11:46.100  sure that the advisors acting in that quarterback capacity 235 00:11:45.100 --> 00:11:48.700  and has the right Specialists for 236 00:11:48.700 --> 00:11:51.200  those needs that might be outside of the scope of 237 00:11:51.200 --> 00:11:54.700  what the advisors doing on a day-to-day and that could be another point 238 00:11:54.700 --> 00:11:57.300  of reference for a client. If you have an accountant who 239 00:11:57.300 --> 00:12:00.400  you've been working with for a long time and you happen to like him 240 00:12:00.400 --> 00:12:03.800  or her in the way that they work maybe they could be a place 241 00:12:03.800 --> 00:12:05.100  where you could go to get a referral. 242 00:12:05.900 --> 00:12:08.800 Because I'm in all likelihood that that CPA 243 00:12:08.800 --> 00:12:11.600  or that attorney is has some 244 00:12:11.600 --> 00:12:14.400  type of relationship with a financial advisor and could give 245 00:12:14.400 --> 00:12:17.100  you a couple of places to go. Yeah, I think that's a great 246 00:12:17.100 --> 00:12:20.200  great piece of advice there. All right. 247 00:12:20.200 --> 00:12:23.300  I want one more topic here because this comes up a 248 00:12:23.300 --> 00:12:26.800  lot and it's the notion of compensation for financial advisors. 249 00:12:26.800 --> 00:12:29.700  I've heard individuals say 250 00:12:29.700 --> 00:12:32.200  that I don't pay my financial advisor or anything. He does 251 00:12:32.200 --> 00:12:35.100  it for free sure right there is 252 00:12:35.100 --> 00:12:38.200  there's a problem this industry, I think with transparency at times and 253 00:12:38.200 --> 00:12:41.500  there's a number of different ways financial advisors are 254 00:12:41.500 --> 00:12:44.100  being compensated. I didn't like frankly I think advisors should 255 00:12:44.100 --> 00:12:47.300  be fairly compensated. They're doing really good work, right? 256 00:12:49.100 --> 00:12:52.300 Depending on the advisor. Of course, Mike tell us 257 00:12:52.300 --> 00:12:54.500  a little bit about the couple of different. 258 00:12:55.300 --> 00:12:59.000 Fee structures or compensation structures there are for financial advisors. 259 00:12:58.600 --> 00:13:01.800  And if there's one that you would recommend over 260 00:13:01.800 --> 00:13:04.300  another I'll rattle them off because it's a 261 00:13:04.300 --> 00:13:07.100  lot of different ones. There's feel only which we've talked a little 262 00:13:07.100 --> 00:13:09.400  bit about there's fee-based. There's Commission 263 00:13:10.100 --> 00:13:10.900 There's retainer. 264 00:13:11.800 --> 00:13:14.900 There's subscription. There's 265 00:13:14.900 --> 00:13:17.400  another one I've heard that I know is out there not as 266 00:13:17.400 --> 00:13:20.600  popular but it's there and there's flat fee. 267 00:13:20.600 --> 00:13:23.600  So there's a number of different ways that advisors are 268 00:13:23.600 --> 00:13:26.700  compensated and the one 269 00:13:26.700 --> 00:13:29.300  of course in my line of work and in terms 270 00:13:29.300 --> 00:13:32.400  of what I do on a daily basis working with us, I come across primarily 271 00:13:32.400 --> 00:13:35.100  not always I would say fee only 272 00:13:35.100 --> 00:13:38.100  in fee based or the two that that primarily I work with 273 00:13:38.100 --> 00:13:41.300  although there are there are others that are 274 00:13:41.300 --> 00:13:44.100  less. So like a retainer I've seen I've come across that 275 00:13:44.100 --> 00:13:47.400  but I say primarily it's fee only and fee-based that 276 00:13:47.400 --> 00:13:50.000  I typically work with advisors and you know, 277 00:13:50.300 --> 00:13:53.100  I'll let Peter elaborate but I'll just say generally that fee only would be 278 00:13:53.100 --> 00:13:56.100  just be be charging, you know, 279 00:13:56.100 --> 00:13:59.300  a fee for services. It could 280 00:13:59.300 --> 00:14:02.100  be it could be a flat fee or could be a fee based 281 00:14:02.100 --> 00:14:05.400  on assets under management that the investor might have with that advisor 282 00:14:05.400 --> 00:14:08.000  fee base is is kind of 283 00:14:08.300 --> 00:14:11.600  a combination of the only and commission if you will it has 284 00:14:12.100 --> 00:14:16.600 The concept of building on assets but also the advisor 285 00:14:15.600 --> 00:14:19.300  has the ability to offer commission-based 286 00:14:18.300 --> 00:14:22.300  products that would follow outside of the fiduciary scope. 287 00:14:21.300 --> 00:14:24.800  I believe Peter and so those are the two that primarily 288 00:14:24.800 --> 00:14:27.500  I see in my kind of interactions with 289 00:14:27.500 --> 00:14:30.400  advisors around the country. Yeah, I think most of our listeners are 290 00:14:30.400 --> 00:14:33.800  probably falling into the fee only fee-based camp 291 00:14:33.800 --> 00:14:36.500  or the commission side right there. There 292 00:14:36.500 --> 00:14:39.600  are a number of different fee models out there in compensation models 293 00:14:39.600 --> 00:14:42.800  and I think they all have their pros and cons but you 294 00:14:42.800 --> 00:14:45.100  just said something that I'm gonna ask Peter O'Brien on 295 00:14:45.100 --> 00:14:45.300  right? 296 00:14:46.100 --> 00:14:47.600 We talked about fiduciary. 297 00:14:48.500 --> 00:14:50.800 If you are paying a commission. 298 00:14:51.900 --> 00:14:55.200 Is your advisor acting as a fiduciary necessarily? Yeah, 299 00:14:54.200 --> 00:14:57.500  if you've your your fee only your 300 00:14:57.500 --> 00:15:00.200  being charged in a fee for your advice and 301 00:15:00.200 --> 00:15:04.700  and whatever the the Investments would be. Where's fee-based 302 00:15:03.700 --> 00:15:06.400  you could be receiving commissions. 303 00:15:07.400 --> 00:15:10.100 On investment products. It's sort of 304 00:15:10.100 --> 00:15:15.800  I guess I'll use the term hybrid approach. So it's 305 00:15:14.800 --> 00:15:17.800  a gray area. They I don't 306 00:15:17.800 --> 00:15:20.100  know if because we don't do that here, you know, 307 00:15:20.100 --> 00:15:23.600  we don't have commission based investment products. It's strictly 308 00:15:23.600 --> 00:15:26.300  putting people into no load low cost 309 00:15:26.300 --> 00:15:29.100  mutual funds and ETFs and we are being 310 00:15:29.100 --> 00:15:32.300  paid a fee based upon those assets under management. We don't 311 00:15:32.300 --> 00:15:35.500  have commissionable investment products to sell and if 312 00:15:35.500 --> 00:15:38.100  you're if an advisor is doing that. 313 00:15:39.300 --> 00:15:42.200 I don't think they can put themselves out there as 314 00:15:42.200 --> 00:15:43.700  as a fiduciary necessarily. 315 00:15:44.500 --> 00:15:47.800 Yeah, I think that the commission side I'm not 316 00:15:47.800 --> 00:15:50.500  knocking it. Just calling it 317 00:15:50.500 --> 00:15:53.100  what it is. It's it's rot with conflicts of interest and 318 00:15:53.100 --> 00:15:56.500  you just said something that I think would would mean 319 00:15:56.500 --> 00:15:57.500  a lot to our listeners, right? 320 00:15:58.500 --> 00:15:58.800 these 321 00:16:00.600 --> 00:16:03.600 percentage of assets fees paying fees you're paying 322 00:16:03.600 --> 00:16:06.200  for advice in that fee stays the 323 00:16:06.200 --> 00:16:09.900  same regardless of the investment product. It's a 324 00:16:09.900 --> 00:16:12.500  with your charging 1% regardless of 325 00:16:12.500 --> 00:16:15.400  the advice you give you earn five you earn that one percent rather. 326 00:16:16.100 --> 00:16:16.900 commissions 327 00:16:17.800 --> 00:16:20.700 Is in compensation for advice it's compensation 328 00:16:20.700 --> 00:16:23.300  for selling a product and that product 329 00:16:23.300 --> 00:16:26.100  has to be suitable not necessarily best interest. 330 00:16:27.700 --> 00:16:30.500 Okay, so that I think that's something that people 331 00:16:30.500 --> 00:16:34.000  don't understand outside of this industry. You 332 00:16:33.400 --> 00:16:36.300  know, there's two ways two major ways 333 00:16:36.300 --> 00:16:39.200  that advisers get compensated fees versus commissions and 334 00:16:39.200 --> 00:16:42.500  one other point that I'll make about fees and correct 335 00:16:42.500 --> 00:16:45.400  me if I'm wrong gentlemen if you're charging fees on assets. 336 00:16:46.300 --> 00:16:49.600 If the asset level goes up the advisor 337 00:16:49.600 --> 00:16:52.900  gets paid more the asset level goes down. I 338 00:16:52.900 --> 00:16:55.800  mean the percentage stays the same but the actual dollars change, so 339 00:16:55.800 --> 00:16:58.500  I think that it actually aligns the interests. 340 00:16:59.400 --> 00:17:02.500 Of the investor and the advisor using a fee model 341 00:17:02.500 --> 00:17:05.400  for Susan commission model where someone might 342 00:17:05.400 --> 00:17:08.600  be asking you to buy a product that you may not necessarily 343 00:17:08.600 --> 00:17:08.900  need. 344 00:17:10.500 --> 00:17:13.800 Correct. And that's that's the thing. We you 345 00:17:13.800 --> 00:17:14.800  start talking about different. 346 00:17:16.100 --> 00:17:19.700 Whether it's Insurance products investment products that have commissions on 347 00:17:19.700 --> 00:17:20.000  them. 348 00:17:20.700 --> 00:17:23.500 Now all of a sudden it could be suitable. But if product 349 00:17:23.500 --> 00:17:24.600  a May pay 350 00:17:25.300 --> 00:17:28.900 X percentage products B may pay X 351 00:17:28.900 --> 00:17:31.100  percentage plus something on top of 352 00:17:31.100 --> 00:17:31.300  it. 353 00:17:32.700 --> 00:17:35.400 A non-fiduciary advisor is probably 354 00:17:35.400 --> 00:17:38.400  going to go to product B because it's going to pay him 355 00:17:38.400 --> 00:17:41.000  or her more and it's a perceived conflict of 356 00:17:41.400 --> 00:17:44.300  interest. I'm not saying that every person out there who's earning a commission is 357 00:17:45.100 --> 00:17:48.500 Is not acting in good faith, but there 358 00:17:48.500 --> 00:17:51.600  is there's a potential for that conflict to be there. Sure. It's 359 00:17:51.600 --> 00:17:54.900  it's all things being equal right? It's they're gonna pick if it's 360 00:17:54.900 --> 00:17:57.500  if it doesn't necessarily hurt the 361 00:17:57.500 --> 00:18:00.500  client and all and the Investments are relatively the 362 00:18:00.500 --> 00:18:04.100  same they're going to gravitate probably towards the higher commission product. 363 00:18:03.100 --> 00:18:06.400  Not that it's a bad thing. But that's the conflict of 364 00:18:06.400 --> 00:18:09.000  interest that we talk about right isn't necessarily in the best 365 00:18:09.300 --> 00:18:12.600  interest of the client. Yeah, and I think investors don't need products as 366 00:18:12.600 --> 00:18:15.600  much as they need advice. Yeah agreed. I totally agree. 367 00:18:15.600 --> 00:18:18.700  We were talking the the other 368 00:18:18.700 --> 00:18:21.800  day just that the the meetings we were we were at and 369 00:18:21.800 --> 00:18:24.300  and the model the way it was is you 370 00:18:24.300 --> 00:18:27.700  had insurance companies or investment firms sort of 371 00:18:27.700 --> 00:18:30.900  sitting at the top designing product and starting 372 00:18:30.900 --> 00:18:33.400  to push that product down to advisors who would 373 00:18:33.400 --> 00:18:36.300  then push it to clients down at the bottom and really our 374 00:18:36.300 --> 00:18:37.800  model is where we flip the script. 375 00:18:38.600 --> 00:18:41.600 The client is at the top and the client comes to the advisor. 376 00:18:42.200 --> 00:18:45.400 And we then go out to the product manufacturers to 377 00:18:45.400 --> 00:18:48.400  find the the best product the best solution for 378 00:18:48.400 --> 00:18:51.000  for the client to make as part of 379 00:18:51.500 --> 00:18:54.300  their financial plan. So I think that's that's a big difference there. 380 00:18:54.300 --> 00:18:57.600  We have nothing proprietary and we are acting in the best interests 381 00:18:57.600 --> 00:19:00.500  of the client looking for a best of breed approach. And 382 00:19:00.500 --> 00:19:03.600  again, usually it comes down to well, what 383 00:19:03.600 --> 00:19:06.100  are the fees associated with that and that's another great piece of 384 00:19:06.100 --> 00:19:07.000  advice for clients. 385 00:19:08.400 --> 00:19:11.300 Understand who you're paying and what you're paying 386 00:19:11.300 --> 00:19:12.100  them and what for? 387 00:19:12.900 --> 00:19:16.000 Whether it's mutual funds inside your 401k or 388 00:19:15.400 --> 00:19:18.800  something inside if you have an IRA through your bank 389 00:19:18.800 --> 00:19:21.500  understand what it what it is and and 390 00:19:21.500 --> 00:19:24.500  how it works. You're the one paying it and and understand how 391 00:19:24.500 --> 00:19:27.400  all of that works and a lot of times people don't realize 392 00:19:27.400 --> 00:19:30.500  that because a lot of times things are are not 393 00:19:30.500 --> 00:19:33.300  apparent you got to do a got to do a little bit of digging to understand 394 00:19:33.300 --> 00:19:36.500  what those those fees are inside of certain products. 395 00:19:36.500 --> 00:19:39.300  Yeah. Absolutely. No, no what you're paying and I think 396 00:19:39.300 --> 00:19:42.200  that there are some compensation models for 397 00:19:42.200 --> 00:19:45.700  advisor out that they're a little bit opaque if 398 00:19:45.700 --> 00:19:48.600  you will but as an investor 399 00:19:48.600 --> 00:19:51.600  working with the financial professional transparency matters, 400 00:19:51.600 --> 00:19:54.200  and if someone's not being transparent, then there's 401 00:19:54.200 --> 00:19:57.000  probably not a lot of trust there in this business is built on trust. 402 00:19:58.100 --> 00:20:01.300 So yeah, I have to disclose everything to everybody up 403 00:20:01.300 --> 00:20:01.700  front because 404 00:20:03.300 --> 00:20:06.300 It's coming out. It's coming out of the account and they'll see it right on the statement as 405 00:20:06.300 --> 00:20:09.600  a line item to the penny. Yeah, exactly, except a 406 00:20:09.600 --> 00:20:09.700  penny. 407 00:20:10.200 --> 00:20:13.700 Absolutely. Well gentlemen, thank you so much for your time. So I 408 00:20:13.700 --> 00:20:16.400  just want to kind of recap because there was so much great information 409 00:20:16.400 --> 00:20:19.500  that the two of you shared if you're an investor 410 00:20:19.500 --> 00:20:22.300  out there if you're one of our listeners and you're looking to work with a financial 411 00:20:22.300 --> 00:20:25.500  professional or if you're looking for maybe a second opinion a couple 412 00:20:25.500 --> 00:20:28.100  of things that that Peter and Michael had talked to us 413 00:20:28.100 --> 00:20:31.400  about today. Make sure you ask the question. Are you acting 414 00:20:31.400 --> 00:20:34.600  in a fiduciary capacity? Probably the most important question to 415 00:20:34.600 --> 00:20:35.700  ask a financial professional. 416 00:20:36.300 --> 00:20:40.100 Number two. What is your financial planning process? Right 417 00:20:39.100 --> 00:20:42.200  the value proposition of a 418 00:20:42.200 --> 00:20:46.200  financial advisor should be based on that planning process. And 419 00:20:45.200 --> 00:20:48.500  since you are paying for advice, I think a great 420 00:20:48.500 --> 00:20:51.300  question is what is your investment philosophy? How do you see the 421 00:20:51.300 --> 00:20:54.400  world work? How are you going to advise me based on that investment 422 00:20:54.400 --> 00:20:55.200  philosophy 423 00:20:55.900 --> 00:20:58.300 When it comes to credentials, I think looking for any credential 424 00:20:58.300 --> 00:21:01.100  makes a lot of sense after a person's name. But if you're 425 00:21:01.100 --> 00:21:04.100  looking for a true financial planner, the cfp designation is the 426 00:21:04.100 --> 00:21:05.900  one that that our guests recommend. 427 00:21:06.600 --> 00:21:09.400 Look for people that work with people like 428 00:21:09.400 --> 00:21:12.600  you look for advisors that are working with people like yourself 429 00:21:12.600 --> 00:21:15.900  and there's a lot of resources out there. Mike mentioned 430 00:21:15.900 --> 00:21:18.600  Napa. There's the advisor's website. Of 431 00:21:18.600 --> 00:21:21.300  course Facebook LinkedIn are great ways to look at how 432 00:21:21.300 --> 00:21:24.200  these advisors are working with 433 00:21:24.200 --> 00:21:28.200  people that may or may not be like you and let me throw another resource 434 00:21:27.200 --> 00:21:31.200  out there. A lot of investors don't realize that you 435 00:21:30.200 --> 00:21:34.300  can Google broker check broker check 436 00:21:34.300 --> 00:21:38.000  is a government website where tracks the history 437 00:21:37.100 --> 00:21:41.000  of every single Financial professional whether they're SEC 438 00:21:40.600 --> 00:21:43.900  registered or member of finra and you'll 439 00:21:43.900 --> 00:21:46.400  see if there's any disclosures or anything like that 440 00:21:46.400 --> 00:21:49.400  so broker checks are great way to see if 441 00:21:49.400 --> 00:21:52.200  if there's any dings on the record of 442 00:21:52.200 --> 00:21:55.100  the person that you're speaking to and then in terms 443 00:21:55.100 --> 00:21:58.700  of compensation look for fees versus commissions not 444 00:21:58.700 --> 00:22:01.200  to say that commissions are necessarily bad, but they 445 00:22:01.200 --> 00:22:04.100  there could be some conflicts of 446 00:22:04.100 --> 00:22:06.500  interest in there and a fee-based advisor. 447 00:22:06.600 --> 00:22:09.200 Even a fee only advisor is going to sit in the same side of 448 00:22:09.200 --> 00:22:12.700  the table as you the investor. So Michael, thank 449 00:22:12.700 --> 00:22:15.200  you so much for your time. Thanks Tom Peter. So thank you 450 00:22:15.200 --> 00:22:19.100  for joining us here today. This has been a great conversation and so 451 00:22:18.100 --> 00:22:21.300  for our listeners out there. Thank you for joining us. 452 00:22:21.300 --> 00:22:24.200  We'll get you on the next one. And if you 453 00:22:24.200 --> 00:22:28.400  want to look at any of our previous unfiltered Finance podcasts, they're 454 00:22:27.400 --> 00:22:30.600  available wherever you might be getting your podcast today. 455 00:22:30.600 --> 00:22:34.200  So thank you till next time. Bye Cemetery Partners. 456 00:22:33.200 --> 00:22:36.600  LLC is an investment advisor 457 00:22:36.600 --> 00:22:39.300  firm registered with the Security and Exchange Commission 458 00:22:39.300 --> 00:22:42.500  The Firm only transacts business in states where 459 00:22:42.500 --> 00:22:45.600  it is properly registered or excluded or 460 00:22:45.600 --> 00:22:49.200  Exempted from registration requirements registration of 461 00:22:48.200 --> 00:22:51.400  an investment advisor does not imply 462 00:22:51.400 --> 00:22:54.500  any specific level of skill or training and does 463 00:22:54.500 --> 00:22:57.300  not constitute an endorsement of the firm by the 464 00:22:57.300 --> 00:23:00.300  commission. No one should assume that future performance of any 465 00:23:00.300 --> 00:23:04.400  specific investment investment strategy product or 466 00:23:03.400 --> 00:23:06.100  non-investment related content. 467 00:23:06.600 --> 00:23:10.000 Reference to directly or indirectly in this material will be 468 00:23:09.000 --> 00:23:10.500  profitable. 469 00:23:11.400 --> 00:23:14.300 As with any investment strategy there is the possibility 470 00:23:14.300 --> 00:23:17.500  of profitability as well as loss due 471 00:23:17.500 --> 00:23:20.200  to various factors including changing market 472 00:23:20.200 --> 00:23:22.600  conditions and/or applicable laws. 473 00:23:23.400 --> 00:23:27.000 Content may not be reflective of current opinions or 474 00:23:26.600 --> 00:23:29.600  positions. Please note the material 475 00:23:29.600 --> 00:23:32.300  is provided for educational and background use only 476 00:23:32.300 --> 00:23:36.000  moreover. You should not assume that any discussion or information 477 00:23:35.700 --> 00:23:38.600  contained in this material serves as 478 00:23:38.600 --> 00:23:42.400  the receipt of or as a substitute for personalized 479 00:23:41.400 --> 00:23:43.700  investment advice.  

As financial professionals, we're often asked one simple question: “do you know what I should buy right now?” In truth, we don't believe it's possible to successfully predict market behaviors most of the time. But, we do believe that a qualified financial advisor can help you devise a plan for long-term success. In this episode of Unfiltered Finance, our own Tom Romano, Head of Strategic Relationships and Product Development, is joined by Symmetry's Michael Storer, Senior Regional Director, and a financial advisor from our sister firm, Apella Wealth, Peter Leppones, CFP®, to answer a more important question: “what should you consider when choosing a financial advisor?” If you have any questions or would like more information, reach out to us at https://symmetrypartners.com/contact-us/ You can also find us on Facebook, YouTube, Twitter, and LinkedIn. As always, we remain invested in your goals. Symmetry Partners, LLC, is an investment advisory firm registered with the Securities and Exchange Commission. The firm only transacts business in states where it is properly registered, excluded or exempted from registration requirements. Registration of an investment adviser does not imply any specific level of skill or training and does not constitute an endorsement of the firm by the Commission. No one should assume that future performance of any specific investment, investment strategy, product or non-investment related content made reference to directly or indirectly in this material will be profitable. As with any investment strategy, there is the possibility of profitability as well as loss. Due to various factors, including changing market conditions and/or applicable laws, the content may not be reflective of current opinions or positions.   Please note the material is provided for educational and background use only. Moreover, you should not assume that any discussion or information contained in this material serves as the receipt of, or as a substitute for, personalized investment advice.   Transcript: 00:00:01.900 --> 00:00:07.400 Hello and 1 00:00:07.400 --> 00:00:10.700  welcome to unfiltered Finance. I'm your host Tom romano. 2 00:00:10.700 --> 00:00:13.300  And thank you for joining us this episode today. We 3 00:00:13.300 --> 00:00:17.000  are talking about choosing the right financial advisor and 4 00:00:16.200 --> 00:00:19.400  I have the perfect guests for this topic 5 00:00:19.400 --> 00:00:22.300  joining us here today first and foremost Mike 6 00:00:22.300 --> 00:00:25.600  store who is a senior Regional director 7 00:00:25.600 --> 00:00:28.100  at symmetry Partners. I asked Mike to be 8 00:00:28.100 --> 00:00:31.700  on the podcast because he works with thousands of financial advisors across 9 00:00:31.700 --> 00:00:34.200  the country. He knows which ones 10 00:00:34.200 --> 00:00:37.200  are doing the appropriate job and due diligence and 11 00:00:37.200 --> 00:00:41.200  planning for their clients and the others who might be dare. I 12 00:00:41.200 --> 00:00:44.500  say fake it Mike faking it and of 13 00:00:44.500 --> 00:00:47.800  course a long time friend of mine Mr. Peter loponis 14 00:00:47.800 --> 00:00:50.900  who's a certified financial planner and financial advisor 15 00:00:50.900 --> 00:00:53.100  with Apollo wealth and happens to be 16 00:00:53.100 --> 00:00:56.200  my personal financial planner. So gentlemen, thank you both for joining 17 00:00:56.200 --> 00:00:59.600  us here today. You're welcome, Tom. Thanks Tom. Great to be here. I thought 18 00:00:59.600 --> 00:01:01.600  this was appropriate topic for us to discuss. 19 00:01:01.900 --> 00:01:04.500 you know coming out of the pandemic I travel a 20 00:01:04.500 --> 00:01:07.400  lot for business and I've been on many planes 21 00:01:07.400 --> 00:01:10.400  over the last few months and you know, whether it's an 22 00:01:10.400 --> 00:01:11.100  airport or 23 00:01:12.400 --> 00:01:16.200 Are sitting next to someone on a plane and just bring 24 00:01:15.200 --> 00:01:19.000  up some small talk and people understand 25 00:01:18.300 --> 00:01:21.300  that I'm working in the financial services a business. 26 00:01:21.300 --> 00:01:25.000  And the first question. I always get is got any 27 00:01:24.200 --> 00:01:27.300  tips. What should I be buying? What 28 00:01:27.300 --> 00:01:31.000  should I be selling? Right? It's a very common question and for 29 00:01:30.300 --> 00:01:33.100  years, my response has always been and I'm 30 00:01:33.100 --> 00:01:36.400  a firm believer of this is the best advice I can give anyone in 31 00:01:36.400 --> 00:01:39.300  that moment is to work with 32 00:01:39.300 --> 00:01:42.300  someone you trust financial planner financial 33 00:01:42.300 --> 00:01:46.300  advisor that's working in a fiduciary capacity. I 34 00:01:45.300 --> 00:01:48.300  have a number of reasons why I say that but 35 00:01:48.300 --> 00:01:51.700  Mike I'd love to hear it from your perspective. Why should 36 00:01:51.700 --> 00:01:54.300  investors people planning for 37 00:01:54.300 --> 00:01:57.300  retirement or for any other Financial need be working 38 00:01:57.300 --> 00:02:00.100  with a financial professional? That's a great question. 39 00:02:00.100 --> 00:02:03.100  I think you hit on it at the in your opening 40 00:02:03.100 --> 00:02:04.100  remarks Tom is that 41 00:02:04.900 --> 00:02:05.200 You know. 42 00:02:06.300 --> 00:02:09.300 Having traveled the country for many 43 00:02:09.300 --> 00:02:14.300  years working with a number of different types of advisors and meeting 44 00:02:13.300 --> 00:02:16.900  with clients at the same time, you know clients have 45 00:02:16.900 --> 00:02:19.200  different desperate needs in terms of when it 46 00:02:19.200 --> 00:02:22.100  comes to financial Financial advice so they can 47 00:02:22.100 --> 00:02:25.100  certainly learn about it on on a website if they 48 00:02:25.100 --> 00:02:28.500  want to but I found that especially the 49 00:02:28.500 --> 00:02:31.900  best advisors are working working with 50 00:02:31.900 --> 00:02:34.400  clients and from that 51 00:02:34.400 --> 00:02:36.300  perspective. I know who these advisors are. 52 00:02:37.300 --> 00:02:40.500 And I know they're doing a great job for their clients. And for me, 53 00:02:40.500 --> 00:02:43.400  the one thing that comes to mind besides everything 54 00:02:43.400 --> 00:02:46.100  else at a financial advisor does because I think about it in 55 00:02:46.100 --> 00:02:49.600  my own world is comfort and peace of mind, right? There's lots 56 00:02:49.600 --> 00:02:51.400  of different moving Parts when it comes to planning. 57 00:02:52.200 --> 00:02:55.500 And and what you're going to do with your money for the long term and even myself 58 00:02:55.500 --> 00:02:58.200  being in this business, I worry about am I making 59 00:02:58.200 --> 00:03:01.900  the right decisions? So I think a lot of it comes down 60 00:03:01.900 --> 00:03:05.400  to peace of mind and comfort. I think that that's high 61 00:03:04.400 --> 00:03:07.300  level. There's a lot of you can drill down from there 62 00:03:07.300 --> 00:03:10.900  but I think for most clients if you think about it, it's getting that 63 00:03:10.900 --> 00:03:13.400  pressure off of you and bringing a 64 00:03:13.400 --> 00:03:16.500  professional and to make sure that you're meeting your life goals, whatever those might 65 00:03:16.500 --> 00:03:19.400  be sure. No, absolutely. I think what I'm hearing you say, I 66 00:03:19.400 --> 00:03:23.100  hear things like planning and long-term and Peter 67 00:03:22.100 --> 00:03:25.700  I'll shift over to you. So 68 00:03:25.700 --> 00:03:28.400  what I'm hearing Mike say and I loved for you to plan 69 00:03:28.400 --> 00:03:31.400  on this when someone asks me got any tips, 70 00:03:31.400 --> 00:03:32.700  why is that the wrong question? 71 00:03:34.600 --> 00:03:35.200 well, I think 72 00:03:36.700 --> 00:03:39.500 the answer they're looking for everyone wants something 73 00:03:39.500 --> 00:03:42.600  that's exciting and and sexy that 74 00:03:42.600 --> 00:03:43.200  they can tell. 75 00:03:44.400 --> 00:03:47.500 Their friends. I think you've used the term water cooler alpha or 76 00:03:47.500 --> 00:03:50.900  Golf Course Alpha everyone thinks somehow because we're 77 00:03:50.900 --> 00:03:53.600  sitting here on the inside. We're insiders. We've 78 00:03:53.600 --> 00:03:56.600  got more information than than they do 79 00:03:56.600 --> 00:03:59.300  as as retail investors, but 80 00:03:59.300 --> 00:04:02.600  that's just not the case and and it's not about 81 00:04:02.600 --> 00:04:05.200  hitting that home run with the stock because 82 00:04:05.200 --> 00:04:08.500  if you're gonna be picking individual stocks, there's gonna 83 00:04:08.500 --> 00:04:11.300  be some home runs in there, but there's got to be some singles and 84 00:04:11.300 --> 00:04:14.500  doubles there's gonna be some losers too. It just 85 00:04:14.500 --> 00:04:18.000  it's gonna happen statistically, but when 86 00:04:17.100 --> 00:04:20.600  we talk about a plan and what 87 00:04:20.600 --> 00:04:23.700  it can do for you long term the sense of confidence 88 00:04:23.700 --> 00:04:26.300  that it's going to give you. That's what you really need. Hey, it's 89 00:04:26.300 --> 00:04:29.300  great to be able to say Jesus I bought in at this stock when when it 90 00:04:29.300 --> 00:04:32.500  was at 10 and it went to a hundred and in two years. It's a 91 00:04:32.500 --> 00:04:33.700  great story, but 92 00:04:35.200 --> 00:04:38.500 Is better to have a sense of confidence and comfort with your 93 00:04:38.500 --> 00:04:41.200  plan and with your financial outcomes, and that's why 94 00:04:41.200 --> 00:04:44.500  sitting down and taking the time to go through a plan with a 95 00:04:44.500 --> 00:04:47.100  cfp with someone who's a fiduciary is really in your 96 00:04:47.100 --> 00:04:50.400  best interest versus getting that that hot stock tip. 97 00:04:50.400 --> 00:04:53.100  Yeah, I would agree. The one thing that 98 00:04:53.100 --> 00:04:56.200  I always comes to mind when someone says got any tips the first 99 00:04:56.200 --> 00:04:59.700  thing I'm thinking well if I had some I wouldn't tell you I'd keep 100 00:04:59.700 --> 00:05:02.300  it all for myself, right? There's wildly more Capital 101 00:05:02.300 --> 00:05:06.600  to be to be earned when you keep those secrets to yourself right quick 102 00:05:05.600 --> 00:05:08.100  short story. Tom and 103 00:05:08.100 --> 00:05:11.400  Peter. My son is out in gainfully employed 104 00:05:11.400 --> 00:05:14.600  in the Working World now and he has a little bit of money and he 105 00:05:14.600 --> 00:05:17.700  asked me about a year ago a year and a half ago to Dad what 106 00:05:17.700 --> 00:05:20.700  stocks should I pick? And so I immediately opened 107 00:05:20.700 --> 00:05:24.300  up the Barron's journal and 108 00:05:24.300 --> 00:05:27.200  I just looked at the stocks to pick now I said, hey, you 109 00:05:27.200 --> 00:05:30.100  know, if you want to buy some technology, here's a bunch of Technology names. I said, 110 00:05:30.100 --> 00:05:33.400  you know, the market has been involved, but if you want to buy stocks, here's a 111 00:05:33.400 --> 00:05:34.800  couple of names that you can just 112 00:05:35.300 --> 00:05:39.500 Your portfolio. So of course he did that on my advice and 113 00:05:38.500 --> 00:05:41.300  then about a year later. He 114 00:05:41.300 --> 00:05:44.400  was blaming me because I'm the one that picked the stocks from in the 115 00:05:44.400 --> 00:05:45.000  stocks were Downs. 116 00:05:45.800 --> 00:05:48.600 I just thought that was kind of interesting because it I did 117 00:05:48.600 --> 00:05:51.400  exactly the opposite of what I should have said to him right in terms 118 00:05:51.400 --> 00:05:54.400  of how we should be approaching these but you know, this was play 119 00:05:54.400 --> 00:05:57.500  money for him. So I let him learn a little bit about what it 120 00:05:57.500 --> 00:06:00.300  really means to invest in those types of questions of the wrong questions, 121 00:06:00.300 --> 00:06:03.000  right as you just mentioned Peter and so I thought it was 122 00:06:03.200 --> 00:06:06.400  a really good it was a it was a learning moment for him to understand that 123 00:06:06.400 --> 00:06:09.700  you don't just pick stocks and they go up. Oh, absolutely and like 124 00:06:09.700 --> 00:06:13.000  I I actually I do that with with clients. I'll 125 00:06:12.200 --> 00:06:13.600  say to them. 126 00:06:14.600 --> 00:06:17.100 If you want to open up a small account and I 127 00:06:17.100 --> 00:06:20.000  use the term your Casino money. Hey, you got to go to 128 00:06:20.100 --> 00:06:23.300  the casino and sit there and maybe go out to dinner have a drink play the 129 00:06:23.300 --> 00:06:26.500  slot sit at a table if you lose a hundred or 200 130 00:06:26.500 --> 00:06:27.100  or $300. 131 00:06:28.500 --> 00:06:30.300 It was a night of entertainment you had a good time. 132 00:06:31.300 --> 00:06:34.600 I see take your Casino money and put it into an account and 133 00:06:34.600 --> 00:06:37.300  buy a couple of stocks and just it's it's 134 00:06:37.300 --> 00:06:40.400  good education for you. You might learn some valuable 135 00:06:40.400 --> 00:06:43.900  lessons, but you're gonna pay really close attention. Even 136 00:06:43.900 --> 00:06:46.200  if it's only five or 10 shares of a 137 00:06:46.200 --> 00:06:49.200  company and you'll you'll learn a lot for it. So I think there is certainly a 138 00:06:49.200 --> 00:06:52.900  value in that but with large sums of Money Retirement accounts 139 00:06:52.900 --> 00:06:55.400  brokerage accounts. Absolutely not none of 140 00:06:55.400 --> 00:06:58.700  this stock picking. It's got to be a low cost. Well Diversified portfolio. 141 00:06:58.700 --> 00:07:01.100  So I'm hearing you say it's okay to sit in a 142 00:07:01.100 --> 00:07:01.300  little bit. 143 00:07:02.300 --> 00:07:05.800 Any bit tiny bit? Absolutely. No, I didn't. You 144 00:07:05.800 --> 00:07:08.300  know, I like to play the market myself, but I'm only doing 145 00:07:08.300 --> 00:07:11.500  that with my my entertainment dollars not my 146 00:07:11.500 --> 00:07:14.500  long-term assets that that my family 147 00:07:14.500 --> 00:07:18.100  and I are going to need at some point in time. Right? So Peter 148 00:07:17.100 --> 00:07:20.400  you've been talking a lot about planning right and and 149 00:07:20.400 --> 00:07:23.200  I've been in this business for a long time as with you 150 00:07:23.200 --> 00:07:27.500  you and I've worked together for many many years. I've noticed 151 00:07:26.500 --> 00:07:29.800  the value proposition of financial advisor 152 00:07:29.800 --> 00:07:32.300  has changed right at one point. It was that 153 00:07:32.300 --> 00:07:36.200  stock picker many many years ago. So this 154 00:07:35.200 --> 00:07:38.400  day and age what what do 155 00:07:38.400 --> 00:07:41.500  you see as the value proposition to a financial advisor? 156 00:07:42.200 --> 00:07:46.000 In my opinion, it has to be the plan because that's 157 00:07:45.300 --> 00:07:48.500  where we've had success as a firm. I've 158 00:07:48.500 --> 00:07:51.300  had success as an advisor clients have had success 159 00:07:51.300 --> 00:07:54.700  following that advice and and really 160 00:07:54.700 --> 00:07:57.100  it's about the planning and that's the most 161 00:07:57.100 --> 00:08:00.600  valuable advice. I give to my clients. Hey, we're with 162 00:08:00.600 --> 00:08:04.200  a low cost. Well Diversified portfolio. We're going 163 00:08:03.200 --> 00:08:06.300  to get a market return the market for us 164 00:08:06.300 --> 00:08:09.300  taking risk. We will get a market return and my 165 00:08:09.300 --> 00:08:12.700  return will be no different than my clients because we invest in very similar 166 00:08:12.700 --> 00:08:16.300  similarly constructed portfolios, but 167 00:08:15.300 --> 00:08:16.700  really 168 00:08:17.900 --> 00:08:20.800 Whether we get an 8% return 9% 10% 169 00:08:20.800 --> 00:08:23.300  return long-term. It's really 170 00:08:23.300 --> 00:08:24.100  the plan. 171 00:08:25.200 --> 00:08:28.500 That is is going to drive all that and just because 172 00:08:28.500 --> 00:08:31.400  their portfolio is up a certain year that that's 173 00:08:31.400 --> 00:08:32.800  great and they like to see that. 174 00:08:33.900 --> 00:08:36.100 But again, the plan is going to say well geez, I 175 00:08:36.100 --> 00:08:39.700  know now I can retire at age 62. I'm 176 00:08:39.700 --> 00:08:43.600  going to take Social Security at 67 when 177 00:08:42.600 --> 00:08:44.700  I retire at 62. 178 00:08:45.500 --> 00:08:48.500 I'm going to be able to pay for my own health insurance until 179 00:08:48.500 --> 00:08:51.700  I hit MediCare at age 65. I mean, those are questions 180 00:08:51.700 --> 00:08:54.300  that aren't even related to a rate 181 00:08:54.300 --> 00:08:57.300  of return or a stock pick or any of that. They're planning 182 00:08:57.300 --> 00:09:00.300  questions, but they're extremely important to people the very 183 00:09:00.300 --> 00:09:03.300  comprehensive list of questions versus should you be in a 184 00:09:03.300 --> 00:09:06.100  60% stock 40% bomb for far beyond that 185 00:09:06.100 --> 00:09:09.400  correct? Correct, but it's it's about the the layers and 186 00:09:09.400 --> 00:09:13.200  the investment management risk reward asset 187 00:09:12.200 --> 00:09:16.000  allocation being allocated appropriately. 188 00:09:17.400 --> 00:09:20.100 According to your risk tolerance that's all part of it. But you 189 00:09:20.100 --> 00:09:23.200  do when I sit down with clients we talk about the 190 00:09:23.200 --> 00:09:26.200  performance we talk about what the markets have been doing and we really start 191 00:09:26.200 --> 00:09:29.700  to get into those those items Healthcare Medicare long 192 00:09:29.700 --> 00:09:33.900  term care gifting money to people grandchildren 193 00:09:32.900 --> 00:09:35.700  setting up a 529 194 00:09:35.700 --> 00:09:38.200  accounts. All those types of things. These 195 00:09:38.200 --> 00:09:41.200  are the goals and the things that are important to clients and they come 196 00:09:41.200 --> 00:09:45.000  through the planning process. Yeah, that's extremely valuable right life 197 00:09:44.100 --> 00:09:47.800  comes at you fast, and there's a number of instances in 198 00:09:47.800 --> 00:09:50.400  my personal life where I've leaned on you for things that 199 00:09:50.400 --> 00:09:53.100  are fun far beyond investable assets. 200 00:09:54.100 --> 00:09:57.200 So that's that's good. So what so far listeners out there. 201 00:09:57.200 --> 00:10:01.100  I mean you're looking for a financial professional that 202 00:10:00.100 --> 00:10:02.300  is planning focused. 203 00:10:03.400 --> 00:10:06.700 But also from a very comprehensive standpoint Beyond 204 00:10:06.700 --> 00:10:09.700  stocks bonds mutual funds Exchange Trade 205 00:10:09.700 --> 00:10:10.300  funds Etc. 206 00:10:11.300 --> 00:10:14.500 So let's one of the things that's a 207 00:10:14.500 --> 00:10:15.100  change gears a little bit. 208 00:10:16.500 --> 00:10:19.500 You know, there's over 300,000 financial advisors in 209 00:10:19.500 --> 00:10:22.400  the United States, right? The term 210 00:10:22.400 --> 00:10:25.700  fiduciary comes up quite a bit and I'm 211 00:10:25.700 --> 00:10:28.800  always surprised maybe I'm not as surprised 212 00:10:28.800 --> 00:10:31.600  as I once was that investors are don't 213 00:10:31.600 --> 00:10:34.900  necessarily understand that sometimes advisors are 214 00:10:34.900 --> 00:10:38.200  acting any fiduciary capacity and sometimes 215 00:10:37.200 --> 00:10:40.300  they are not before we 216 00:10:40.300 --> 00:10:41.500  jump into that. 217 00:10:42.400 --> 00:10:45.500 Explain to us Peter. What is a fiduciary? Well, it's 218 00:10:45.500 --> 00:10:48.700  it's the highest standard of care in in 219 00:10:48.700 --> 00:10:51.700  our industry. And I've sort of I've been on both 220 00:10:51.700 --> 00:10:54.300  sides of it. So I have to act in my 221 00:10:54.300 --> 00:10:57.200  clients best interest not only being affiliated with with a 222 00:10:57.200 --> 00:11:00.600  palette but also being a cfp and really 223 00:11:00.600 --> 00:11:03.300  what that comes down to at the end of the day 224 00:11:03.300 --> 00:11:05.300  is the type of 225 00:11:06.600 --> 00:11:09.200 Investment product. I'm going to refer to 226 00:11:09.200 --> 00:11:12.900  everything as a product that we put our clients into and 227 00:11:13.700 --> 00:11:18.800 I've got a really focus on the cost the level 228 00:11:17.800 --> 00:11:20.600  of care below a fiduciary. It's 229 00:11:20.600 --> 00:11:23.400  referred to as the suitability standard. Does that mean if I'm 230 00:11:23.400 --> 00:11:26.800  not a fiduciary? I'm doing something unethical absolutely not 231 00:11:26.800 --> 00:11:30.300  the last thing I want to do because I again I was there I've worked 232 00:11:30.300 --> 00:11:33.200  with clients where I was just doing by this suitability standard. I 233 00:11:33.200 --> 00:11:36.200  was not a fiduciary at the end of the 234 00:11:36.200 --> 00:11:40.200  day. I'm putting my clients into something that is putting more money back 235 00:11:39.200 --> 00:11:43.100  into their pocket meaning the fees 236 00:11:42.100 --> 00:11:46.200  and the costs associated with those products are 237 00:11:45.200 --> 00:11:49.200  much lower. We have 238 00:11:49.200 --> 00:11:52.500  no Front End Sales charges. We have no backend sales charges. 239 00:11:52.500 --> 00:11:55.100  So I said to clients that are that are coming on board. 240 00:11:56.100 --> 00:11:59.400 I will bend over backwards to make sure that you are happy but at some 241 00:11:59.400 --> 00:12:03.300  point if you don't realize the value 242 00:12:02.300 --> 00:12:05.500  of our services or you chose to go elsewhere, you 243 00:12:05.500 --> 00:12:08.800  can do that. You're going to be able to take what you have here and 244 00:12:08.800 --> 00:12:11.400  move that elsewhere. You're not going to be tied up for three or 245 00:12:11.400 --> 00:12:14.300  five or ten years. No surrender charges or big 246 00:12:14.300 --> 00:12:17.000  fees to go acting in their best interest and that helps 247 00:12:17.200 --> 00:12:20.100  to protect them. And I think it's extremely important that people 248 00:12:20.100 --> 00:12:20.700  need to ask 249 00:12:22.800 --> 00:12:25.700 Are you a fiduciary is your firm of fiduciary? And how 250 00:12:25.700 --> 00:12:27.600  do you work? So when? 251 00:12:28.900 --> 00:12:32.200 Investors are looking for a financial 252 00:12:31.200 --> 00:12:34.400  professional to work with right what I'm 253 00:12:34.400 --> 00:12:37.800  hearing someone the first things I should look for and they should ask about it potentially 254 00:12:37.800 --> 00:12:40.600  even get it in writing. Are you acting any fiduciary 255 00:12:40.600 --> 00:12:45.100  capacity? Are you acting in my best interest? Correct? They 256 00:12:44.100 --> 00:12:48.800  absolutely should and and interview multiple 257 00:12:47.800 --> 00:12:52.600  people Tom has 258 00:12:51.600 --> 00:12:54.200  been not only a great client. But I've worked 259 00:12:54.200 --> 00:12:57.500  with many of Tom's family members. Why because they come to Tom. Jeez 260 00:12:57.500 --> 00:13:00.700  Tom. I've got some questions. Who should I work with? Well talk 261 00:13:00.700 --> 00:13:03.400  to Peter. So if you have a friend or family member who you 262 00:13:03.400 --> 00:13:06.500  know works with an advisor ask for that that person's name. 263 00:13:06.500 --> 00:13:09.400  And if they will if you have a friend or family member they'll 264 00:13:09.400 --> 00:13:12.300  refer them over if they enjoy working with them. So I think that's a 265 00:13:12.300 --> 00:13:15.800  good place to start but interview them there's many checklists 266 00:13:15.800 --> 00:13:18.800  online and I think one of the things you want to ask about are 267 00:13:18.800 --> 00:13:21.800  you a fiduciary understand what that means and it's 268 00:13:21.800 --> 00:13:24.900  it's something important because there's 269 00:13:24.900 --> 00:13:27.300  plenty of us out. There aren't as many as probably there should 270 00:13:27.300 --> 00:13:28.900  be but there's plenty fiduc. 271 00:13:28.900 --> 00:13:30.000 He's out there for you to work with. 272 00:13:30.800 --> 00:13:33.000 Absolutely. You made a really good point. I was doing a little research. 273 00:13:34.300 --> 00:13:35.600 Knowing that we were going to have this. 274 00:13:36.500 --> 00:13:39.400 Talk today the three of us and you know, 275 00:13:39.400 --> 00:13:42.700  the number one way investors find their financial advisors through 276 00:13:42.700 --> 00:13:45.500  through referrals. Right number two is through 277 00:13:45.500 --> 00:13:49.500  you know online searches and things like that. So 278 00:13:48.500 --> 00:13:51.200  I think that's that's really important 279 00:13:51.200 --> 00:13:54.200  when you're looking for financial audience advisor talk to your family 280 00:13:54.200 --> 00:13:57.800  your friends people who have or may have similar Financial 281 00:13:57.800 --> 00:14:00.200  situations as you do but I 282 00:14:00.200 --> 00:14:03.600  think you know, the important thing. Is that the very good question. Are 283 00:14:03.600 --> 00:14:06.900  you acting and a fiduciary capacity at all times, right? 284 00:14:11.300 --> 00:14:14.100 We talked about the planning process one of the things I want to 285 00:14:14.100 --> 00:14:17.700  touch upon and Mike will turn to you is that sometimes giving 286 00:14:17.700 --> 00:14:20.700  good advice means saying no not giving 287 00:14:20.700 --> 00:14:23.900  the client what they're looking for. Right and 288 00:14:23.900 --> 00:14:27.400  I've seen advisors who act 289 00:14:26.400 --> 00:14:29.700  as more of a facilitator 290 00:14:29.700 --> 00:14:32.400  very high service level but whatever the client 291 00:14:32.400 --> 00:14:35.400  wants they they get what are some of the Perils of 292 00:14:35.400 --> 00:14:35.500  that? 293 00:14:36.700 --> 00:14:40.200 The Perils are that you become all 294 00:14:39.200 --> 00:14:42.100  things to all people and as I think 295 00:14:42.100 --> 00:14:46.400  Thomas you have famously said if everything's 296 00:14:45.400 --> 00:14:48.600  important nothing's important and 297 00:14:48.600 --> 00:14:51.300  I think from the perspective of advice that we work with 298 00:14:51.300 --> 00:14:54.100  it's it's you know 299 00:14:54.100 --> 00:14:57.800  when you when you think about that kind of cafeteria style 300 00:14:57.800 --> 00:14:59.000  service. 301 00:14:59.900 --> 00:15:01.400 It becomes very difficult to. 302 00:15:02.900 --> 00:15:05.500 Address clients needs concerns or 303 00:15:05.500 --> 00:15:08.000  fears because you know 304 00:15:08.700 --> 00:15:11.400  in terms of of investment investment advice, 305 00:15:11.400 --> 00:15:14.400  if you're if you've got clients that are in individual stocks 306 00:15:14.400 --> 00:15:17.800  and you have clients in Diversified portfolios, or they're in a more passive 307 00:15:17.800 --> 00:15:21.200  investment or they're in a tactical investment. You're constantly 308 00:15:20.200 --> 00:15:23.400  pivoting to try to answer questions to 309 00:15:23.400 --> 00:15:26.300  all these different constituencies within your practice what we 310 00:15:26.300 --> 00:15:29.700  find in our in our work is that you know advisors that 311 00:15:29.700 --> 00:15:32.400  have a philosophy advisors have a way that 312 00:15:32.400 --> 00:15:36.000  they approach the capital markets and how they construct portfolios I 313 00:15:35.500 --> 00:15:39.000  tend to do the best because their clients are like-minded and 314 00:15:38.400 --> 00:15:41.300  it keeps them in their seats even when markets are 315 00:15:41.300 --> 00:15:42.900  difficult. So having a 316 00:15:43.800 --> 00:15:46.200 Kind of a carte blanche or 317 00:15:46.200 --> 00:15:49.900  I like to say cafeteria style investment or at 318 00:15:49.900 --> 00:15:52.300  least offering makes it more difficult for you to keep your 319 00:15:52.300 --> 00:15:56.200  clients in line. I think over time and I think what I 320 00:15:56.200 --> 00:15:59.600  like like best about being at symmetries, we do have that investment philosophy. That's 321 00:15:59.600 --> 00:16:02.700  straightforward. It doesn't deviate and most 322 00:16:02.700 --> 00:16:05.000  of the advice that work with us tend to have 323 00:16:05.100 --> 00:16:08.300  that same philosophy. The interesting thing about that too is you notice 324 00:16:08.300 --> 00:16:11.300  when markets are fairly volatile which where this is really important 325 00:16:11.300 --> 00:16:14.700  is that you know investors that 326 00:16:14.700 --> 00:16:18.000  kind of adhere to similar investment 327 00:16:17.400 --> 00:16:20.700  strategy like symmetries is that they tend 328 00:16:20.700 --> 00:16:23.800  to have less gap between What markets are doing and what 329 00:16:23.800 --> 00:16:26.300  their Investments are doing because they tend to stay in their seats. They're not 330 00:16:26.300 --> 00:16:29.800  moving around behaviorally moving in and out of the market or moving in and 331 00:16:29.800 --> 00:16:31.600  out of Investments. And I think that's sometimes can be the 332 00:16:32.400 --> 00:16:35.700 the offshoot of having a strategy where 333 00:16:35.700 --> 00:16:37.200  you're just trying to be everything to everybody. 334 00:16:38.800 --> 00:16:41.200 I'm going to unpack use it a lot of really yeah, I get 335 00:16:41.200 --> 00:16:44.100  there. Sorry, but no. No, I just want to make sure our listeners get it to get 336 00:16:44.100 --> 00:16:47.700  some really really good insight there Mike. So first 337 00:16:47.700 --> 00:16:50.800  and foremost you talk about an investment philosophy 338 00:16:50.800 --> 00:16:53.700  and what I'm hearing you say is that we're talking 339 00:16:53.700 --> 00:16:56.100  about advice, right and if someone wants to 340 00:16:56.100 --> 00:16:58.200  give advice you have to have a stake in the ground. 341 00:16:59.400 --> 00:17:02.300 You have to have that place where your your view on 342 00:17:02.300 --> 00:17:04.200  how Capital markets work? 343 00:17:04.900 --> 00:17:07.400 And if you don't have that view you might fall into that 344 00:17:07.400 --> 00:17:08.700  facilitator capacity. 345 00:17:10.300 --> 00:17:13.300 The other thing that she said I'm glad you 346 00:17:13.300 --> 00:17:16.300  said it as you talked a lot about behavior and what I'm hearing you 347 00:17:16.300 --> 00:17:19.500  say is the study we've used many times the dial 348 00:17:19.500 --> 00:17:22.500  bar study for our listeners. Could you talk a little bit about what that dial bar 349 00:17:22.500 --> 00:17:26.000  research shows us sure is that it shows that the the investor 350 00:17:25.200 --> 00:17:26.600  over, you know? 351 00:17:27.600 --> 00:17:30.100 Many time periods. I mean they updated every year but it goes 352 00:17:30.100 --> 00:17:33.600  back a number of years and it looks at what investors 353 00:17:33.600 --> 00:17:36.200  do in terms of investing in 354 00:17:36.200 --> 00:17:39.600  the let's say the S&P 500 as an index versus what the 355 00:17:39.600 --> 00:17:43.300  index does and we find year in and year out that investors 356 00:17:42.300 --> 00:17:45.200  tend to underperform the 357 00:17:45.200 --> 00:17:48.500  index and the question always is Peter and you know this why 358 00:17:48.500 --> 00:17:51.500  and it's because they're holding period is 359 00:17:51.500 --> 00:17:54.600  tends to be I think it's less it used to be in the old days three 360 00:17:54.600 --> 00:17:57.300  three plus years now. It's three minus here. It's less 361 00:17:57.300 --> 00:18:00.200  than three years of holding period of time, which means they're 362 00:18:00.900 --> 00:18:03.500 Behaviorally trying to in some 363 00:18:03.500 --> 00:18:06.400  ways time the market and so what we 364 00:18:06.400 --> 00:18:09.000  try to do at least in as I talk 365 00:18:09.100 --> 00:18:12.300  to advisors is to try to educate them and educate clients as 366 00:18:12.300 --> 00:18:15.300  well that you know, we want to close that Gap we 367 00:18:15.300 --> 00:18:18.200  call that the the performance Gap right? 368 00:18:18.200 --> 00:18:22.000  There's a gap between what investments do and what the investor 369 00:18:21.300 --> 00:18:24.300  does right? We know this plenty of Dad out 370 00:18:24.300 --> 00:18:27.100  there to show that so how do we do that? Peter had talked about a little 371 00:18:27.100 --> 00:18:30.300  bit earlier is we look at things like, okay, what's important? How do 372 00:18:30.300 --> 00:18:33.600  we close that Gap? It comes from financial planning. It comes 373 00:18:33.600 --> 00:18:37.000  from portfolio selection, not necessarily portfolio 374 00:18:36.300 --> 00:18:39.400  management, but portfolio selection in terms 375 00:18:39.400 --> 00:18:42.600  of picking the right model of the right strategy for for clients 376 00:18:42.600 --> 00:18:45.000  education and communication with clients. I 377 00:18:45.100 --> 00:18:48.900  think those are great ways that we see that behavioral Gap 378 00:18:48.900 --> 00:18:51.700  closing through time and that and 379 00:18:51.700 --> 00:18:54.900  ends up being a an experience 380 00:18:54.900 --> 00:18:57.000  that clients will be with their advisors for a long time 381 00:18:57.300 --> 00:19:00.400  because you focus on the things that matter not the investment 382 00:19:00.400 --> 00:19:00.700  itself. 383 00:19:01.800 --> 00:19:02.700 a great computer 384 00:19:03.500 --> 00:19:06.800 You're the the man in the seat here. So talk 385 00:19:06.800 --> 00:19:09.200  to us a little about that. Right? I mean that dial bar study is 386 00:19:09.200 --> 00:19:11.600  pretty telling every year investors are underperforming. 387 00:19:12.300 --> 00:19:15.900 You focus on planning. How does planning help with the 388 00:19:15.900 --> 00:19:18.200  long-term thinking that is required for 389 00:19:18.200 --> 00:19:20.500  successful experience. It comes into 390 00:19:21.800 --> 00:19:24.500 Not only the planning but educating clients and 391 00:19:24.500 --> 00:19:27.600  communication and the example I'll use and we were 392 00:19:27.600 --> 00:19:27.800  all. 393 00:19:28.500 --> 00:19:32.200 working from back home during the the pandemic and 394 00:19:33.900 --> 00:19:36.200 the markets dropped about a 395 00:19:36.200 --> 00:19:36.800  third 396 00:19:37.800 --> 00:19:40.700 so about 33% in about a month's time thinking 397 00:19:40.700 --> 00:19:43.600  the numbers are 33% over 34 days 1/3. 398 00:19:44.300 --> 00:19:47.300 And we're sitting here stuck at home. We think the world is going 399 00:19:47.300 --> 00:19:50.400  to end and my message to my clients because 400 00:19:50.400 --> 00:19:54.000  it's the message of our firm message that I truly believe. 401 00:19:55.300 --> 00:19:55.700 And it wasn't easy. 402 00:19:56.400 --> 00:19:59.600 No, we're not doing anything this too shall 403 00:19:59.600 --> 00:19:59.700  pass. 404 00:20:00.600 --> 00:20:03.600 You know, this is the.com bubble. This 405 00:20:03.600 --> 00:20:06.600  is 911. This is the 406 00:20:06.600 --> 00:20:09.900  great financial crisis of 2008. 407 00:20:10.600 --> 00:20:13.400 It doesn't necessarily matter what the event 408 00:20:13.400 --> 00:20:16.500  is because everyone know Peter is a pandemic. It's different like you're 409 00:20:16.500 --> 00:20:20.100  right, but you're not it's the uncertainty and what 410 00:20:19.100 --> 00:20:22.700  lo and behold what happens after the 411 00:20:22.700 --> 00:20:23.900  market drops a third. 412 00:20:24.800 --> 00:20:27.800 In March February and to March it 413 00:20:27.800 --> 00:20:30.700  shoots back up. It comes roaring back why we 414 00:20:30.700 --> 00:20:34.100  had no vaccine. We still were unemployment had 415 00:20:33.100 --> 00:20:36.200  still not hit its peak because of 416 00:20:36.200 --> 00:20:39.900  all the you know, retail and entertainment losses 417 00:20:39.900 --> 00:20:42.200  that that took place in in this country and around the 418 00:20:42.200 --> 00:20:45.000  world. We still have this crazy election in front 419 00:20:45.100 --> 00:20:48.800  of us. There was still uncertainty but why why did it happen and I 420 00:20:48.800 --> 00:20:51.500  don't think there's necessarily an answer but the lesson learned 421 00:20:51.500 --> 00:20:54.800  is we stay in our seats regardless of what's going on because 422 00:20:54.800 --> 00:20:57.500  the markets have they've always come back and I 423 00:20:57.500 --> 00:20:59.500  believe any time we hit something. 424 00:21:00.700 --> 00:21:03.300 They'll come back again. We just don't know when so that 425 00:21:03.300 --> 00:21:06.100  experience because I I think 426 00:21:06.100 --> 00:21:09.200  you use the term staking in the stand or stake in the ground. That was my 427 00:21:09.200 --> 00:21:12.200  stake in the ground. And now as we went through all of this in 428 00:21:12.200 --> 00:21:15.500  2022 with all of the uncertainty and inflation and 429 00:21:15.500 --> 00:21:18.700  gas prices and all of that impacting 430 00:21:18.700 --> 00:21:20.700  the markets interest rates being increased. 431 00:21:22.200 --> 00:21:25.200 People said yeah, I remember what you said back during the 432 00:21:25.200 --> 00:21:28.200  pandemic. So yeah, okay that that makes sense. It's the 433 00:21:28.200 --> 00:21:30.300  messaging my messages consistent. 434 00:21:31.200 --> 00:21:34.000 And when people hear that, there's a sense of confidence like, you know what he was 435 00:21:34.200 --> 00:21:36.400  right last time. He'll probably be right this time, too. 436 00:21:37.400 --> 00:21:40.200 Fantastic, and I remember that Panda right that 437 00:21:40.200 --> 00:21:43.500  first quarter of 2020 was one of the top 10 worst 438 00:21:43.500 --> 00:21:48.100  quarters in the United States history going back to 1926. The 439 00:21:47.100 --> 00:21:50.200  second quarter of 2020 was one of the top 10 440 00:21:50.200 --> 00:21:53.400  best quarters the United States ever experienced going 441 00:21:53.400 --> 00:21:56.200  back. And and the funny thing is if we had 442 00:21:56.200 --> 00:21:59.200  been if we had moved our money out of we did 443 00:21:59.200 --> 00:22:02.500  not stay calm and we moved money out 444 00:22:02.500 --> 00:22:05.300  of the market in March. What would 445 00:22:05.300 --> 00:22:08.700  we have missed? When do we get back in? It's it's 446 00:22:08.700 --> 00:22:11.200  difficult. It's difficult to sit there 447 00:22:11.200 --> 00:22:14.100  when the market is dropping and say my gosh we have to do 448 00:22:14.100 --> 00:22:17.600  something but you're also playing the same game when you get out. It's like 449 00:22:17.600 --> 00:22:20.200  well if you get out, okay well, but then the market will eventually 450 00:22:20.200 --> 00:22:21.700  come back. Well, when do you get back in? 451 00:22:22.600 --> 00:22:25.300 And and and we just see long-term what the 452 00:22:25.300 --> 00:22:26.600  results are you're better off. 453 00:22:27.400 --> 00:22:30.500 Staying going dealing with the rollercoaster ride 454 00:22:30.500 --> 00:22:33.500  staying in your seat versus making rash decisions based 455 00:22:33.500 --> 00:22:36.100  upon fear and emotion Peter Michael. Thank you so much 456 00:22:36.100 --> 00:22:39.400  for joining us here today that concludes part one of our discussion 457 00:22:39.400 --> 00:22:42.200  on choosing the right financial advisor. I look 458 00:22:42.200 --> 00:22:45.200  forward to continuing the conversation at part two, and if you want to 459 00:22:45.200 --> 00:22:48.800  look at any of our previous unfiltered Finance podcasts, they're 460 00:22:48.800 --> 00:22:51.700  available wherever you might be getting your podcast today. So, 461 00:22:51.700 --> 00:22:53.400  thank you till next time bye-bye. 462 00:22:53.900 --> 00:22:56.500 Symmetry Partners LLC is an 463 00:22:56.500 --> 00:22:59.500  investment advisor firm registered with the Securities and 464 00:22:59.500 --> 00:23:02.200  Exchange Commission The Firm only transacts business 465 00:23:02.200 --> 00:23:06.200  in states where it is properly registered or excluded 466 00:23:05.200 --> 00:23:10.000  or Exempted from registration requirements registration 467 00:23:08.100 --> 00:23:11.700  of an investment advisor does 468 00:23:11.700 --> 00:23:14.900  not imply any specific level of skill or training and 469 00:23:14.900 --> 00:23:17.400  does not constitute an endorsement of the firm 470 00:23:17.400 --> 00:23:20.500  by the commission. No one should assume that future performance 471 00:23:20.500 --> 00:23:23.600  of any specific investment investment strategy 472 00:23:23.600 --> 00:23:26.900  product or non-investment related content 473 00:23:26.900 --> 00:23:29.200  made reference to directly or indirectly in 474 00:23:29.200 --> 00:23:31.400  this material will be profitable. 475 00:23:32.400 --> 00:23:35.400 As with any investment strategy there is the possibility of 476 00:23:35.400 --> 00:23:38.600  profitability as well as loss due to 477 00:23:38.600 --> 00:23:41.600  various factors including changing market conditions. 478 00:23:41.600 --> 00:23:44.800  And/or applicable laws the content 479 00:23:44.800 --> 00:23:47.800  may not be reflective of current opinions or 480 00:23:47.800 --> 00:23:50.500  positions. Please note the material 481 00:23:50.500 --> 00:23:53.800  is provided for educational and background use only moreover. 482 00:23:53.800 --> 00:23:57.000  You should not assume that any discussion or information 483 00:23:56.700 --> 00:23:59.700  contained in this material Services the 484 00:23:59.700 --> 00:24:03.300  receipt of or as a substitute for personalized 485 00:24:02.300 --> 00:24:04.500  investment advice.

The “Tax-Man” cometh! As this tax season proceeds ever forward, many investors are asking themselves the same question - “am I going to take a large tax-hit this year?” We cannot say how much you'll be taxed on your present investments. But, we believe it's possible to structure your portfolio in a manner that mitigates tax-loss, and, leaves more money in your respective pockets. Joining us today is Philip McDonald, CFA, CAIA, Symmetry's Managing Director of Research and Investments & Glenn Shirley, CAIA, Head of Investor Relations for Quantinno, to explain how investors can more effectively structure their portfolios and avoid an excess of taxation. If you have any questions or would like more information, reach out to us at https://symmetrypartners.com/contact-us/ You can also find us on Facebook, YouTube, Twitter, and LinkedIn. As always, we remain invested in your goals. Symmetry Partners, LLC, is an investment advisory firm registered with the Securities and Exchange Commission. The firm only transacts business in states where it is properly registered, excluded or exempted from registration requirements. Registration of an investment adviser does not imply any specific level of skill or training and does not constitute an endorsement of the firm by the Commission. No one should assume that future performance of any specific investment, investment strategy, product or non-investment related content made reference to directly or indirectly in this material will be profitable. As with any investment strategy, there is the possibility of profitability as well as loss. Due to various factors, including changing market conditions and/or applicable laws, the content may not be reflective of current opinions or positions.   Please note the material is provided for educational and background use only. Moreover, you should not assume that any discussion or information contained in this material serves as the receipt of, or as a substitute for, personalized investment advice.   Transcript:   00:00:01.800 --> 00:00:07.400 Hello everyone. 1 00:00:07.400 --> 00:00:10.800  Welcome to unfiltered Finance. This is your host Tom Romano. 2 00:00:10.800 --> 00:00:13.800  I want to welcome you all back. We have a very 3 00:00:13.800 --> 00:00:17.100  interesting topic to discuss with you today. It's 4 00:00:16.100 --> 00:00:19.400  the notion of investors keeping more money in 5 00:00:19.400 --> 00:00:22.900  their pockets by bringing tax management into 6 00:00:22.900 --> 00:00:25.300  their investment Holdings. Not only are 7 00:00:25.300 --> 00:00:28.200  we going to talk about tax management, but some of the things investors should 8 00:00:28.200 --> 00:00:31.200  be considering in terms of how they view Capital markets how they should be 9 00:00:31.200 --> 00:00:34.400  investing and then we have a couple of special guests 10 00:00:34.400 --> 00:00:38.000  to talk about some additional strategies that investors should 11 00:00:37.400 --> 00:00:40.700  consider in terms of bringing tax 12 00:00:40.700 --> 00:00:43.700  Alpha if you will to the table so joining 13 00:00:43.700 --> 00:00:46.100  us is Phil McDonald who is the 14 00:00:46.100 --> 00:00:49.400  president of the panoramic trust and managing director of 15 00:00:49.400 --> 00:00:52.700  research of symmetry Partners as well as Glenn Shirley 16 00:00:52.700 --> 00:00:55.700  who is a principal and head of investor relations 17 00:00:55.700 --> 00:00:58.200  at quantino Capital Management Glen and 18 00:00:58.200 --> 00:01:01.500  Phil. Thank you so much for joining us here today. Thanks for having me tone. Thanks Tom. 19 00:01:01.500 --> 00:01:01.800  It's great. 20 00:01:01.900 --> 00:01:04.900 be with you, you know at quantino 100% of 21 00:01:04.900 --> 00:01:07.200  our focus is on taxable investors and 22 00:01:07.900 --> 00:01:10.500 We're managing portfolios while also seeking 23 00:01:10.500 --> 00:01:13.300  to generate really consistent and strong tax benefits 24 00:01:13.300 --> 00:01:16.800  for clients. And that goal is to maximize their 25 00:01:16.800 --> 00:01:19.400  after-tax wealth to help them keep as much return as possible 26 00:01:19.400 --> 00:01:22.200  year to year and we couldn't be more thrilled to partner with Symmetry and 27 00:01:22.200 --> 00:01:25.200  the incredible advisors that you serve. So thanks 28 00:01:25.200 --> 00:01:28.300  for having us pleasure to have you both. I look forward 29 00:01:28.300 --> 00:01:31.300  to to the today's dialogue. Sometimes taxes aren't the 30 00:01:31.300 --> 00:01:34.300  most interesting topic. However, I think that 31 00:01:34.300 --> 00:01:37.300  there's some very important information that investors should 32 00:01:37.300 --> 00:01:40.700  be considering in terms of how they invest their assets. And 33 00:01:40.700 --> 00:01:43.000  so thank you both for joining us. There's a couple 34 00:01:43.100 --> 00:01:46.100  of different angles. I want to take this conversation, right? And the first 35 00:01:46.100 --> 00:01:49.000  one I think I want to to go towards is 36 00:01:50.100 --> 00:01:53.500 Specific investment philosophies, right? So Phil we adhere 37 00:01:53.500 --> 00:01:57.300  to what we refer to as an evidence-based investment philosophy allowing 38 00:01:56.300 --> 00:01:59.200  markets to produce the returns that 39 00:01:59.200 --> 00:02:03.300  are investors are entitled to at the end of the day. So talk 40 00:02:02.300 --> 00:02:05.700  to us a little bit from a tax standpoint 41 00:02:05.700 --> 00:02:08.200  the benefits of an evidence-based investment 42 00:02:08.200 --> 00:02:09.500  philosophy versus 43 00:02:10.500 --> 00:02:13.500 Paying for Alpha or active 44 00:02:13.500 --> 00:02:16.600  money management. Mm-hmm. No, you raise a erase. 45 00:02:16.600 --> 00:02:19.700  Very good point Tom. So our investment philosophy all 46 00:02:19.700 --> 00:02:22.800  often refer to it as multi-factor investing. It 47 00:02:22.800 --> 00:02:27.300  involves specific rules quantitative indicators 48 00:02:26.300 --> 00:02:29.800  that research for 49 00:02:29.800 --> 00:02:32.100  a very long time has indicated, you know 50 00:02:32.100 --> 00:02:35.400  might create a premium over time. So following, you know, 51 00:02:35.400 --> 00:02:38.900  a value and small and momentum and high quality 52 00:02:38.900 --> 00:02:41.600  High profitability type of strategy you might 53 00:02:41.600 --> 00:02:44.700  expect to do a little bit better than just a cap weighted 54 00:02:44.700 --> 00:02:47.300  index over time what you get with 55 00:02:47.300 --> 00:02:50.900  that again is, you know, rules-based very Diversified. So 56 00:02:50.900 --> 00:02:53.700  for the most part low turnover right there, 57 00:02:53.700 --> 00:02:56.300  there are there are some strategies that have 58 00:02:56.300 --> 00:02:59.000  a little turnover specifically momentum. You probably have a little 59 00:02:59.100 --> 00:03:02.600  bit higher turnover than a market capitalization way to index but 60 00:03:02.600 --> 00:03:05.600  generally speaking, you know, these signals are relatively slow 61 00:03:05.600 --> 00:03:08.500  moving you're very diverseified. Each holding is 62 00:03:08.500 --> 00:03:10.200  a small percentage of your portfolio. 63 00:03:10.700 --> 00:03:13.300 So for the most part, you don't have to turn over 64 00:03:13.300 --> 00:03:16.400  the portfolio very often. You don't have to trade a lot sell a 65 00:03:16.400 --> 00:03:19.200  lot to reposition into the into the next 66 00:03:19.200 --> 00:03:22.700  Holdings you would want. I mentioned momentum alone has has a 67 00:03:22.700 --> 00:03:25.900  higher turnover as an individual strategy. There are 68 00:03:25.900 --> 00:03:29.100  benefits in putting it together with other factors specifically 69 00:03:28.100 --> 00:03:31.100  momentum and value work very well 70 00:03:31.100 --> 00:03:35.000  together because they're negatively correlated and in the same portfolio, 71 00:03:34.600 --> 00:03:37.000  the the turnover momentum can be 72 00:03:37.600 --> 00:03:41.000  somewhat counteracted in reduced by having other factors 73 00:03:40.200 --> 00:03:43.200  in there specifically value. So the 74 00:03:43.200 --> 00:03:46.400  pairing of factors can help with the tax efficiency of 75 00:03:46.400 --> 00:03:49.200  the portfolio, right momentum by definition is a high 76 00:03:49.200 --> 00:03:53.100  turnover strategy. Meaning there's a lot of trading right now this 77 00:03:52.100 --> 00:03:55.800  this signal is you know, essentially a year 78 00:03:55.800 --> 00:03:58.300  or so a little less than a year. So you would 79 00:03:58.300 --> 00:04:01.200  expect and that's the 80 00:04:01.200 --> 00:04:04.400  standard kind of academic one year price momentum type of 81 00:04:04.400 --> 00:04:07.700  indicator quantitative rule. So you'd 82 00:04:07.700 --> 00:04:10.400  expect momentum to lead to changes at about 83 00:04:10.800 --> 00:04:14.500 Near Horizon your portfolio, which is especially inconvenient 84 00:04:13.500 --> 00:04:16.300  to with regard to tax 85 00:04:16.300 --> 00:04:19.600  law because you know, you have the short-term long term type of 86 00:04:19.600 --> 00:04:22.300  cap gain consideration as well. Sure. So I 87 00:04:22.300 --> 00:04:25.400  mean we've had a lot of conversations about on this podcast about 88 00:04:25.400 --> 00:04:28.100  a fishing markets diversification Buy and Hold 89 00:04:28.100 --> 00:04:31.600  stay the course, but what I'm hearing you say is that just from a 90 00:04:31.600 --> 00:04:34.500  tax standpoint it almost sounds like it's a convenient byproduct of 91 00:04:34.500 --> 00:04:37.300  it hearing to a buy an old strategy. That's a 92 00:04:37.300 --> 00:04:40.700  great way to think about it and you you mentioned relative to 93 00:04:40.700 --> 00:04:43.400  other strategies. So I want to respond directly to 94 00:04:43.400 --> 00:04:46.300  that as well. So let's just call, you know, 95 00:04:46.300 --> 00:04:49.300  multi-factor Diversified investing as a strategy 96 00:04:49.300 --> 00:04:52.400  and investment philosophy relative to you know, 97 00:04:52.400 --> 00:04:55.800  kind of old-fashioned active management where a 98 00:04:55.800 --> 00:04:58.500  manager is picking and choosing you were stocks 99 00:04:58.500 --> 00:05:02.000  maybe reacting to Market events 100 00:05:01.100 --> 00:05:04.400  making predictions turning the portfolio over, 101 00:05:04.400 --> 00:05:07.400  you know, if you know, each position is about 10% 102 00:05:07.400 --> 00:05:10.100  you know, just selling one position creates a lot 103 00:05:10.100 --> 00:05:10.700  of turnover. 104 00:05:10.700 --> 00:05:13.400 Or so typically those actively managed strategies 105 00:05:13.400 --> 00:05:16.500  that are more concentrated and and require more 106 00:05:16.500 --> 00:05:19.300  trading are less tax efficient. Lord know 107 00:05:19.300 --> 00:05:22.800  that absolutely makes sense and Glenn. I know that you share in our 108 00:05:22.800 --> 00:05:25.400  view on how Capital markets work. Do you 109 00:05:25.400 --> 00:05:28.500  care to add anything to fills comments? Well, I think tax laws 110 00:05:28.500 --> 00:05:32.200  harvesting in general is a perfect strategy 111 00:05:31.200 --> 00:05:34.600  to use evidence based investing 112 00:05:34.600 --> 00:05:37.100  and I say that because tax laws are 113 00:05:37.100 --> 00:05:40.300  visiting at its core is you have names in the portfolio that 114 00:05:40.300 --> 00:05:43.300  are essentially winners. They've appreciated we want 115 00:05:43.300 --> 00:05:45.400  to hold those continue to hold those names. 116 00:05:46.300 --> 00:05:49.700 But you're gonna have stocks that have gone down those stocks 117 00:05:49.700 --> 00:05:52.400  in a really simple example you 118 00:05:52.400 --> 00:05:55.400  would sell but at that moment when you sell that 119 00:05:55.400 --> 00:05:55.700  name. 120 00:05:56.500 --> 00:05:58.300 You have to replace it with another stock. 121 00:05:59.300 --> 00:06:02.600 So at that moment, that's a perfect time to utilize 122 00:06:02.600 --> 00:06:05.200  your evidence-based beliefs. If 123 00:06:05.200 --> 00:06:08.100  you want to tilt the portfolio toward cheaper stocks or 124 00:06:08.100 --> 00:06:11.900  stocks with better attributes of quality or profitability. If you 125 00:06:11.900 --> 00:06:14.400  add that in to the stock 126 00:06:14.400 --> 00:06:17.500  selection of replacing that name via, which 127 00:06:17.500 --> 00:06:20.200  you've realized that tax loss then we believe you 128 00:06:20.200 --> 00:06:23.200  can add some nice return Over The Benchmark over 129 00:06:23.200 --> 00:06:23.400  time. 130 00:06:24.100 --> 00:06:28.100 So yeah tax loss harvesting and offering after tax improvements 131 00:06:27.100 --> 00:06:30.200  for clients can type very nicely with 132 00:06:30.200 --> 00:06:31.700  evidence-based investing. 133 00:06:32.400 --> 00:06:35.500 Yeah, I think that intentional turnover if you will with 134 00:06:35.500 --> 00:06:39.000  tasks lost harvesting does open up the door for some creativity 135 00:06:38.500 --> 00:06:41.600  is what I'm hearing. You say Glenn in order 136 00:06:41.600 --> 00:06:45.600  of enhancing returns. I mean I've seen in the past people liquidata 137 00:06:44.600 --> 00:06:47.600  position, they might hold cash for 30 138 00:06:47.600 --> 00:06:49.700  days or might replace it with an ETF. 139 00:06:50.700 --> 00:06:53.400 But Glenn what I'm hearing you say is that when that happens, there's 140 00:06:53.400 --> 00:06:54.600  opportunities to be a little bit more. 141 00:06:55.700 --> 00:06:58.900 Creative I guess the word when it comes to reinvesting those 142 00:06:58.900 --> 00:07:01.400  assets special specifically 143 00:07:01.400 --> 00:07:04.500  through a factor lens, right? That's right. And and 144 00:07:04.500 --> 00:07:07.300  I would also add Tom that's one advantage of 145 00:07:07.300 --> 00:07:10.600  the Symmetry platform versus maybe other tax loss 146 00:07:10.600 --> 00:07:13.700  harvesting options is that you know with with quantino 147 00:07:13.700 --> 00:07:16.600  involved we can add a modest long short extension 148 00:07:16.600 --> 00:07:19.300  to a strategy which gives it some 149 00:07:19.300 --> 00:07:22.400  unique advantages versus long only text less harvesting so 150 00:07:23.200 --> 00:07:26.800 And long only tax loss harvesting. You'll typically have a risk budget. 151 00:07:26.800 --> 00:07:29.500  So to speak, you know, there's only so much 152 00:07:29.500 --> 00:07:32.600  deviation versus The Benchmark the clients willing 153 00:07:32.600 --> 00:07:32.700  to take 154 00:07:33.600 --> 00:07:35.200 but with that risk budget 155 00:07:35.800 --> 00:07:38.300 If you do tilt toward maybe you're 156 00:07:38.300 --> 00:07:41.500  evidence-based beliefs would maybe value momentum 157 00:07:41.500 --> 00:07:44.900  you're taking up a little bit of that rich risk budget. So 158 00:07:44.900 --> 00:07:48.000  by taking up that risk budget, you're reducing the 159 00:07:47.800 --> 00:07:50.300  expected tax benefit because you're a 160 00:07:50.300 --> 00:07:52.400  little bit more constrained and tax less harvesting. 161 00:07:53.400 --> 00:07:56.200 So one disadvantage of perhaps long only text less 162 00:07:56.200 --> 00:07:59.800  harvesting with the long short extension that long 163 00:07:59.800 --> 00:08:02.500  short extension itself is the engine for tax benefit 164 00:08:02.500 --> 00:08:03.100  generation. 165 00:08:03.800 --> 00:08:06.300 So you can do a lot of created them things in 166 00:08:06.300 --> 00:08:09.100  the portfolio. You could tilt toward your your factors and 167 00:08:09.100 --> 00:08:12.900  your in your beliefs, but you're not giving up any expected 168 00:08:12.900 --> 00:08:13.600  tax benefit. 169 00:08:14.600 --> 00:08:17.400 If you're if you're employing that long short extension. 170 00:08:18.300 --> 00:08:22.300 Yeah, I kind of want to hang on that point Glen because we say 171 00:08:21.300 --> 00:08:25.100  and Phil I think would agree with with you 172 00:08:24.100 --> 00:08:27.000  that you know, there's no such thing as 173 00:08:27.100 --> 00:08:29.200  a perfect portfolio, right? Every portfolio is 174 00:08:30.200 --> 00:08:33.500 As it's trade-offs or is 175 00:08:33.500 --> 00:08:37.500  a compromise if you will and if you want tax efficiency 176 00:08:36.500 --> 00:08:40.400  as a main goal Factor investing 177 00:08:40.400 --> 00:08:43.200  might not be the best way to do it. It's a 178 00:08:43.200 --> 00:08:47.000  better way of doing it versus just a beta portfolio. But 179 00:08:46.100 --> 00:08:49.500  what I'm hearing you say Glens you get kind of The Best of Both Worlds 180 00:08:49.500 --> 00:08:52.500  by utilizing things like margin and 181 00:08:52.500 --> 00:08:55.400  short positions. Is that correct? I would 182 00:08:55.400 --> 00:08:58.900  I would agree that I would think the long short extension 183 00:08:58.900 --> 00:09:02.100  itself introduces more creativity in 184 00:09:01.100 --> 00:09:06.000  the portfolio because that 185 00:09:04.500 --> 00:09:07.800  engine of tax benefit generation 186 00:09:07.800 --> 00:09:10.900  is there it doesn't depend on the underlying portfolio 187 00:09:10.900 --> 00:09:13.500  for those strong and consistent text benefits. So, 188 00:09:14.400 --> 00:09:17.400 You have a lot more flexibility to implement the core part 189 00:09:17.400 --> 00:09:20.200  of that portfolio as you see fit. Sure. No, I think that makes 190 00:09:20.200 --> 00:09:24.000  a lot of sense. There's a lot of strategies that we're deploying now the 13030 191 00:09:23.300 --> 00:09:27.200  which you're alluding to Glenn I think is very interesting but filament 192 00:09:26.200 --> 00:09:29.400  in our experience, we've seen our new 193 00:09:29.400 --> 00:09:33.100  favorite word ossification, right which essentially means 194 00:09:32.100 --> 00:09:35.400  that when you own a a basket of 195 00:09:35.400 --> 00:09:39.300  security is whether it's ETS mutual funds are stocks at some 196 00:09:38.300 --> 00:09:42.000  point you get to an area 197 00:09:41.200 --> 00:09:44.300  over time where you can't do anything 198 00:09:44.300 --> 00:09:48.000  with that portfolio because of embedded gains, right 199 00:09:47.300 --> 00:09:51.100  and we've seen that over the years with our portfolios. 200 00:09:50.100 --> 00:09:53.700  Can you comment a little bit on that? Yeah, absolutely and 201 00:09:54.900 --> 00:09:57.200 The the irony in that 202 00:09:57.200 --> 00:10:00.300  situation is you should want to get there right because 203 00:10:00.300 --> 00:10:03.200  you want your portfolio to increase in value. So 204 00:10:03.200 --> 00:10:06.600  the way you you get to the point of having 205 00:10:06.600 --> 00:10:09.500  no unrealized losses in your portfolio to 206 00:10:09.500 --> 00:10:13.100  clip and realize for for tax efficient 207 00:10:12.100 --> 00:10:15.100  repositioning is your portfolio goes up 208 00:10:15.100 --> 00:10:19.200  over time and there's some interesting research on this. I think there's broad 209 00:10:18.200 --> 00:10:21.500  agreement that even in a 210 00:10:21.500 --> 00:10:24.300  diversified long only portfolio. You probably 211 00:10:24.300 --> 00:10:27.200  only have a single digit number of years, you know, some of 212 00:10:27.200 --> 00:10:30.200  it's going to depend on your assumptions and where the market goes and and how 213 00:10:30.200 --> 00:10:33.200  you've invested and how your tax Lots look but, you know, 214 00:10:33.200 --> 00:10:36.600  three four five years. Maybe might be the limit 215 00:10:36.600 --> 00:10:38.400  you have to do. 216 00:10:39.100 --> 00:10:42.900 Efficient tax less harvesting and that type of portfolio before you 217 00:10:42.900 --> 00:10:45.300  have to start to really give on the 218 00:10:45.300 --> 00:10:48.200  risk budget and and we refer to this idea 219 00:10:48.200 --> 00:10:51.700  of tracking error, which is you know, how different returns essentially 220 00:10:51.700 --> 00:10:54.100  will look relative to a benchmark and you start 221 00:10:54.100 --> 00:10:57.600  to to need to accept a lot of a lot of tracking error. If 222 00:10:57.600 --> 00:11:00.700  you're not willing to accept some realization of gains in 223 00:11:00.700 --> 00:11:03.500  in managing that portfolio. So all of a sudden, you know 224 00:11:03.500 --> 00:11:06.400  portfolio you you might be paying somebody to manage and 225 00:11:06.400 --> 00:11:09.700  do tax laws harvesting on becomes something 226 00:11:09.700 --> 00:11:12.400  that might look a little bit more like an expensive 227 00:11:12.400 --> 00:11:15.100  and noisy index. You don't have the ability to 228 00:11:15.100 --> 00:11:18.500  do many transactions in that so, you know, the 1330 that 229 00:11:18.500 --> 00:11:21.100  you and Glenn have started to talk about really frees up 230 00:11:21.100 --> 00:11:24.800  the opportunity to do something with that portfolio sure 231 00:11:24.800 --> 00:11:27.600  and you know, we talked a lot about direct indexing you 232 00:11:27.600 --> 00:11:30.400  and I did a podcast of a few episodes ago 233 00:11:30.400 --> 00:11:31.900  about direct indexing. 234 00:11:32.400 --> 00:11:35.700 And the more names the more tickers the 235 00:11:35.700 --> 00:11:38.200  more opportunity you have to harvest losses, but even 236 00:11:38.200 --> 00:11:41.100  with direct indexing when you hold maybe a hundred or so 237 00:11:41.100 --> 00:11:44.200  underlying stocks you do get it 238 00:11:44.200 --> 00:11:48.300  to a period where you you're eventually going to hold a basket 239 00:11:47.300 --> 00:11:50.600  of very low cost basis with 240 00:11:50.600 --> 00:11:52.900  high embedded gains securities. 241 00:11:53.500 --> 00:11:56.100 And so and the irony is that's the goal. 242 00:11:56.100 --> 00:11:59.100  You had alluded to like we want to see games in our 243 00:11:59.100 --> 00:12:02.100  portfolio. However, you know, we want our investors to be 244 00:12:02.100 --> 00:12:06.500  able to keep more in their pockets through through tax efficiency. So clunky. 245 00:12:05.500 --> 00:12:08.000  We started going down the path of the 246 00:12:08.900 --> 00:12:11.800  1330 strategy, right and in direct indexing 247 00:12:11.800 --> 00:12:14.600  certainly is a step up from a tax efficiency standpoint. 248 00:12:14.600 --> 00:12:17.300  It certainly helps describe for us a little bit about 249 00:12:17.300 --> 00:12:20.500  how that 130 30 works and multiple Market 250 00:12:20.500 --> 00:12:23.400  environments if you will sure that you 251 00:12:23.400 --> 00:12:26.600  Tom so, you know at the end of the day if you 252 00:12:26.600 --> 00:12:29.900  have a hundred dollars of a direct indexing portfolio 253 00:12:31.900 --> 00:12:34.400 maybe assume that direct indexing portfolio maybe 254 00:12:34.400 --> 00:12:37.900  has a 50% cost basis or a 60% cost basis 255 00:12:37.900 --> 00:12:40.200  that tends to be roughly the cost basis where 256 00:12:41.100 --> 00:12:44.700 You're kind of handcuffed from a tax benefit generation perspective. 257 00:12:44.700 --> 00:12:47.600  You know what quantina would do would be take 258 00:12:47.600 --> 00:12:50.800  that $100 portfolio use the the margin inherent 259 00:12:50.800 --> 00:12:52.800  in that account just like clients who 260 00:12:53.500 --> 00:12:56.200 You know borrow us modest amount from their Equity port for 261 00:12:56.200 --> 00:12:59.600  those from time to time use that same margin capability and then 262 00:12:59.600 --> 00:13:03.000  we're going to go long thirty dollars in short 263 00:13:02.400 --> 00:13:05.600  thirty dollars. So we're building a 130/30 strategy 264 00:13:05.600 --> 00:13:09.200  using the margin borrowing of 265 00:13:09.200 --> 00:13:12.700  that account. No other cash is required. That's an important part and 266 00:13:12.700 --> 00:13:15.000  then if you think about that $30 long $30 267 00:13:15.600 --> 00:13:18.400  short, that's gonna be Diversified across hundreds of stocks. 268 00:13:18.400 --> 00:13:21.600  Every tax loss harvesting strategy needs breath. You 269 00:13:21.600 --> 00:13:24.400  need just a lot of stocks to be invested in because you're gonna have winners 270 00:13:24.400 --> 00:13:27.900  and losers and then you think about that portfolios the 271 00:13:27.900 --> 00:13:30.500  market goes up as the market goes down. You have 272 00:13:30.500 --> 00:13:33.400  a little bit of a structural Advantage versus long only long only 273 00:13:33.400 --> 00:13:36.400  will tend to generate great tax benefits When the market dips 274 00:13:37.300 --> 00:13:40.600 But it struggles to generate tax benefits When the market Rises and 275 00:13:40.600 --> 00:13:43.100  you know clients invest in equities because they believe 276 00:13:43.100 --> 00:13:46.400  the Market's going to rise over time. So that short side of that portfolio is 277 00:13:46.400 --> 00:13:49.900  really important in the consistency of 278 00:13:49.900 --> 00:13:52.300  tax benefits over time. So if you have a 279 00:13:52.300 --> 00:13:55.300  long short portfolio on top of 280 00:13:55.300 --> 00:13:58.800  your direct indexing account, you're able to recharge 281 00:13:58.800 --> 00:14:01.300  tax benefits, you know almost immediately after 282 00:14:01.300 --> 00:14:04.400  you apply that long short extension. We can also use 283 00:14:04.400 --> 00:14:07.300  that to clean up the portfolios as 284 00:14:07.300 --> 00:14:10.700  Phil mentioned over time. You're tracking air may rise, you're making 285 00:14:10.700 --> 00:14:13.700  some deviations versus The Benchmark. So the 286 00:14:13.700 --> 00:14:15.500  risk in that portfolio is also Rising. 287 00:14:16.200 --> 00:14:20.300 So if you have an overexposure to say Information Technology, 288 00:14:19.300 --> 00:14:22.100  those names have done really well over the past 289 00:14:22.100 --> 00:14:26.200  five to 10 years. We can use the short book the short 290 00:14:25.800 --> 00:14:28.900  $30 of that portfolio to reduce 291 00:14:28.900 --> 00:14:31.900  some of that overweight which will help clients reduce 292 00:14:31.900 --> 00:14:34.500  risk in those accounts as well. So it's a combination of 293 00:14:35.400 --> 00:14:38.000 You know using that long short extension obviously to 294 00:14:38.400 --> 00:14:41.100  generate great text benefits and a consistent way for clients, but also 295 00:14:41.100 --> 00:14:45.000  to give them a better and less risky Investment Portfolio along 296 00:14:44.300 --> 00:14:47.300  the way. Thank you gentlemen, that that's very 297 00:14:47.300 --> 00:14:50.100  insightful for our listeners. Thank you for for listening to 298 00:14:50.100 --> 00:14:53.000  us. You can access this podcast and all of 299 00:14:53.100 --> 00:14:56.600  our podcasts and our series anywhere you get your podcasts, we're 300 00:14:56.600 --> 00:14:59.400  gonna continue this conversation. So for our listeners, be sure 301 00:14:59.400 --> 00:15:02.300  to tune in for part two on our topic of investing 302 00:15:02.300 --> 00:15:05.700  in taxes Cemetery Partners. LLC is 303 00:15:05.700 --> 00:15:08.600  an investment advisor firm registered with the Securities 304 00:15:08.600 --> 00:15:11.600  and Exchange Commission, The Firm only transacts business 305 00:15:11.600 --> 00:15:14.500  in states where it is properly registered or 306 00:15:14.500 --> 00:15:18.000  excluded or Exempted from registration requirements 307 00:15:17.300 --> 00:15:20.200  registration of an investment 308 00:15:20.200 --> 00:15:23.400  advisor does not imply any specific level of skill or 309 00:15:23.400 --> 00:15:26.300  training and does not constitute and endorsement 310 00:15:26.300 --> 00:15:29.400  of the firm by the commission. No one should assume that 311 00:15:29.400 --> 00:15:33.100  future performance of any specific investment investment strategy 312 00:15:32.100 --> 00:15:35.300  product or non-in. 313 00:15:35.600 --> 00:15:38.600 Related content made reference to directly or indirectly 314 00:15:38.600 --> 00:15:40.800  in this material will be profitable. 315 00:15:41.800 --> 00:15:44.200 As with any investment strategy there is 316 00:15:44.200 --> 00:15:47.900  the possibility of profitability as well as loss due 317 00:15:47.900 --> 00:15:50.600  to various factors including changing market 318 00:15:50.600 --> 00:15:53.700  conditions. And/or applicable laws the 319 00:15:53.700 --> 00:15:56.900  content may not be reflective of current opinions 320 00:15:56.900 --> 00:15:59.600  or positions. Please note the 321 00:15:59.600 --> 00:16:02.400  material is provided for educational and background use 322 00:16:02.400 --> 00:16:05.900  only moreover. 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Ron Gordon talks the final trading news for 2022, and then a great talk with actor Frank Romano and brother Tom Romano about their off-broadway about Dietrich Bonhoeffer entitled: Bonhoeffer-Last Days. (resisted Adolph Hitler)

Open-ended Mutual Funds and Exchange Traded Funds are both popular investment vehicles. They carry a number of similarities, including; their "basket-like" structure, and exposure opportunities. But, there are critical differences between the two, which, can impact the way you invest your hard earned money. Joining our own Tom Romano is Symmetry's Kevin Scully, CFA, Senior Research Associate, Portfolio Manager, to discuss these key differences, and how you can determine which investment best suits your needs. If you have any questions or would like more information, reach out to us at https://symmetrypartners.com/contact-us/ You can also find us on Facebook, YouTube, Twitter, and LinkedIn. As always, we remain invested in your goals. Symmetry Partners, LLC, is an investment advisory firm registered with the Securities and Exchange Commission. The firm only transacts business in states where it is properly registered, excluded or exempted from registration requirements. Registration of an investment adviser does not imply any specific level of skill or training and does not constitute an endorsement of the firm by the Commission. No one should assume that future performance of any specific investment, investment strategy, product or non-investment related content made reference to directly or indirectly in this material will be profitable. As with any investment strategy, there is the possibility of profitability as well as loss. Due to various factors, including changing market conditions and/or applicable laws, the content may not be reflective of current opinions or positions.   Please note the material is provided for educational and background use only. Moreover, you should not assume that any discussion or information contained in this material serves as the receipt of, or as a substitute for, personalized investment advice.  

No investor wants to work with a financial advisor who is content with settling for less. In this episode of Unfiltered Finance, our own Tom Romano is joined by Symmetry's Associate Director of Marketing, Andrea Loin, to explain why, and how, financial advisors should work to continuously develop their businesses. We'll give you a hint, it can improve the client experience…for all involved. If you have any questions or would like more information, reach out to us at https://symmetrypartners.com/contact-us/ You can also find us on Facebook, YouTube, Twitter, and LinkedIn. As always, we remain invested in your goals. Symmetry Partners, LLC, is an investment advisory firm registered with the Securities and Exchange Commission. The firm only transacts business in states where it is properly registered, excluded or exempted from registration requirements. Registration of an investment adviser does not imply any specific level of skill or training and does not constitute an endorsement of the firm by the Commission. No one should assume that future performance of any specific investment, investment strategy, product or non-investment related content made reference to directly or indirectly in this material will be profitable. As with any investment strategy, there is the possibility of profitability as well as loss. Due to various factors, including changing market conditions and/or applicable laws, the content may not be reflective of current opinions or positions.   Please note the material is provided for educational and background use only. Moreover, you should not assume that any discussion or information contained in this material serves as the receipt of, or as a substitute for, personalized investment advice.

For investors, the following statement is self-evident, “my portfolio is better off in the hands of a well-informed and skilled advisor.” This is the fundamental belief that led us to hold our educational conference - Summit 2022. From November 9th - November 10th, we covered any number of topics including marketing, client service, and direct indexing. In this episode of Unfiltered Finance, Tom Romano is joined by William Chettle, Symmetry's Head of Advisor Relations & Client Experience, to discuss this year's Summit and the potential benefit this sort of event can ultimately have for advisors' clients. If you have any questions or would like more information, reach out to us at https://symmetrypartners.com/contact-us/ You can also find us on Facebook, YouTube, Twitter, and LinkedIn. As always, we remain invested in your goals. Symmetry Partners, LLC, is an investment advisory firm registered with the Securities and Exchange Commission. The firm only transacts business in states where it is properly registered, excluded or exempted from registration requirements. Registration of an investment adviser does not imply any specific level of skill or training and does not constitute an endorsement of the firm by the Commission. No one should assume that future performance of any specific investment, investment strategy, product or non-investment related content made reference to directly or indirectly in this material will be profitable. As with any investment strategy, there is the possibility of profitability as well as loss. Due to various factors, including changing market conditions and/or applicable laws, the content may not be reflective of current opinions or positions.   Please note the material is provided for educational and background use only. Moreover, you should not assume that any discussion or information contained in this material serves as the receipt of, or as a substitute for, personalized investment advice.

Welcome Back to Unfiltered Finance for "Part Two" of our episode - Popular Questions About Investing. Symmetry's Tom Romano, Director of National Sales, is joined once again by the founder of Story Market Services & CEO of Empirica Solutions Group, Inc., Casey Dylan, CIMA®, to discuss the value of seeking qualified (and accredited) insight before making critical investment decisions.  To get your question answered, reach out to us at https://symmetrypartners.com/contact-us/ You can also find us on Facebook, YouTube, Twitter, and LinkedIn. As always, we remain invested in your goals. Symmetry Partners, LLC, is an investment advisory firm registered with the Securities and Exchange Commission. The firm only transacts business in states where it is properly registered, excluded or exempted from registration requirements. Registration of an investment adviser does not imply any specific level of skill or training and does not constitute an endorsement of the firm by the Commission. No one should assume that future performance of any specific investment, investment strategy, product or non-investment related content made reference to directly or indirectly in this material will be profitable. As with any investment strategy, there is the possibility of profitability as well as loss. Due to various factors, including changing market conditions and/or applicable laws, the content may not be reflective of current opinions or positions.   Please note the material is provided for educational and background use only. Moreover, you should not assume that any discussion or information contained in this material serves as the receipt of, or as a substitute for, personalized investment advice.

In this episode of Unfiltered Finance, Tom Romano, Symmetry Partners' Director of National Sales is joined by the founder of the newly formed Story Market Services & CEO of Empirica Solutions Group, Inc., Casey Dylan, CIMA®, to address some of the questions we frequently receive from both investors and financial advisors. To get your question answered, reach out to us at https://symmetrypartners.com/contact-us/ You can also find us on Facebook, YouTube, Twitter, and LinkedIn. As always, we remain invested in your goals. Symmetry Partners, LLC, is an investment advisory firm registered with the Securities and Exchange Commission. The firm only transacts business in states where it is properly registered, excluded or exempted from registration requirements. Registration of an investment adviser does not imply any specific level of skill or training and does not constitute an endorsement of the firm by the Commission. No one should assume that future performance of any specific investment, investment strategy, product or non-investment related content made reference to directly or indirectly in this material will be profitable. As with any investment strategy, there is the possibility of profitability as well as loss. Due to various factors, including changing market conditions and/or applicable laws, the content may not be reflective of current opinions or positions.   Please note the material is provided for educational and background use only. Moreover, you should not assume that any discussion or information contained in this material serves as the receipt of, or as a substitute for, personalized investment advice.

For the financial advisors in our audience, it's a cornerstone of quality service to address clients' concerns and meet their needs when customizing portfolios. In this episode of Unfiltered Finance, Symmetry's Tom Romano, Head of Strategic Relationships, and Phil McDonald, CFA, CAIA, Managing Director of Research Investments & Portfolio Manager, relay the importance of ongoing reevaluation (and reallocation) when managing a personalized index portfolio. To learn more about personalized direct investing visit http://www.symmetryaxiom.com You can also find us on Facebook, YouTube, Twitter, and LinkedIn. As always, we remain invested in your goals. Symmetry Partners, LLC, is an investment advisory firm registered with the Securities and Exchange Commission. The firm only transacts business in states where it is properly registered, excluded or exempted from registration requirements. Registration of an investment adviser does not imply any specific level of skill or training and does not constitute an endorsement of the firm by the Commission. No one should assume that future performance of any specific investment, investment strategy, product or non-investment related content made reference to directly or indirectly in this material will be profitable. As with any investment strategy, there is the possibility of profitability as well as loss. Due to various factors, including changing market conditions and/or applicable laws, the content may not be reflective of current opinions or positions.   Please note the material is provided for educational and background use only. Moreover, you should not assume that any discussion or information contained in this material serves as the receipt of, or as a substitute for, personalized investment advice.

Many high-net-worth individuals, and their families, have specific requirements, tax considerations, and investment preferences, that cannot be addressed by conventional investment options. Welcome back to Unfiltered Finance! In the first installment of this two-part episode, Symmetry's Tom Romano, Head of Strategic Relationships, and Phil McDonald, CFA, CAIA, Managing Director of Research Investments & Portfolio Manager, discuss the practice of personalized direct investing, how it works, and how it can be customized to suit investors' individual values. To learn more about personalized direct investing visit http://www.symmetryaxiom.com Listen to the full episode here: https://info.symmetrypartners.com/unfiltered-finance You can also find us on Facebook, YouTube, Twitter, and LinkedIn. As always, we remain invested in your goals. Symmetry Partners, LLC, is an investment advisory firm registered with the Securities and Exchange Commission. The firm only transacts business in states where it is properly registered, excluded or exempted from registration requirements. Registration of an investment adviser does not imply any specific level of skill or training and does not constitute an endorsement of the firm by the Commission. No one should assume that future performance of any specific investment, investment strategy, product or non-investment related content made reference to directly or indirectly in this material will be profitable. As with any investment strategy, there is the possibility of profitability as well as loss. Due to various factors, including changing market conditions and/or applicable laws, the content may not be reflective of current opinions or positions.   Please note the material is provided for educational and background use only. Moreover, you should not assume that any discussion or information contained in this material serves as the receipt of, or as a substitute for, personalized investment advice.

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Hosted by Mark Hoffmann and Tom Romano. The show airs EVERY Sunday, from 3-4pm on KFBK AM 1530 and Newstalk 93.1 FM in Sacramento, CA.

In this episode we reflect on a few of the fun conversations we've had over the year and share a few of our Favorite Rapid Fire's from 2021. Our first rapid fire is to pay respects to our Canadian roots and we shared Kevin Thistle, CEO at PGA of Canada (3:14 minute mark) We also decided to feature our first NHL Superstar Mark Scheifele of the Winnipeg Jets (18:15 minute mark) Going down south to our Friends in America we talk with JC Deacon, Head Coach of The Florida Gators Golf Team (Joined by his friend Craig) (33:12 minute mark) Lastly we feature a conversation with our new partner, Galvin Green and our chat with GM of North America, Tom Romano (57:00 minute mark) All that and much more! If you have any questions or feedback please email us at fourjackpodcast@gmail.com If you like the podcast please rate, review and share with your friends! Cheers. https://www.pgaofcanada.com/ https://www.instagram.com/mscheif/ https://www.instagram.com/realjcdeacon/ https://www.instagram.com/gatorsmgolf/ https://www.instagram.com/galvingreen/ https://www.instagram.com/romeno4three/ --- Support this podcast: https://anchor.fm/thefourjackpod/support

In this episode the boys bring on the General Manager of Galvin Green North America, Mr. Tom Romano. We get into Tom's quick ascent to the top of the company and the excitement around the brand and the push being made in the North American market. Tom discusses life in New York city and some of the golf he gets to experience in the North East, along with the lifestyle the brand offers him, giving him the chance to travel across America. We also chat about the fun and challenging sides of navigating the golf industry. This episode was recorded on a Friday night, which basically became a night in the pub.. LIVELY chat from the boys and our boy Tom Romano! Enjoy the show! If you have any questions or feedback please email us at fourjackpodcast@gmail.com If you like the podcast please rate, review and share with your friends! Cheers. https://www.instagram.com/romeno4three/ https://www.instagram.com/galvingreen/ --- Support this podcast: https://anchor.fm/thefourjackpod/support

In this special episode, recorded during our third and final writers group, we talked shop - writers workshop - with Tom Romano and Regie Routman.Tom is the author of several books on writing, including Write What Matters: For Yourself, For Others.Regie has also authored many professional literacy resources for educators, most recently Literacy Essentials: Engagement, Excellence, and Equity for All Learners. So get out your notebooks, settle in with a favorite beverage, and soak up the wisdom from two excellent teachers of writers and writing. Related ResourcesTranscript + AudioTom’s article we discussed: “Giant at Reds”Regie’s article we discussed: “Roaming Around the Known” (plus her website)A book Tom recommended about writing memoir: Inventing the TruthCheck this episode out on Apple below, and give the podcast a rating!Full TranscriptMatt Renwick:In this special episode recorded during our third and final writers group, we talk shop - writer's workshop - with Tom Romano and Regie Routman. Tom is the author of several books on writing, including Write What Matters For Yourself, For Others. Regie has also authored many professional literacy resources for educators, most recently, Literacy Essentials: Engagement, Excellence, and Equity For All Learners. So get out your notebooks, settle in with a favorite beverage and soak up the wisdom from two excellent teachers of writers and writing.Matt Renwick:Again, feel free to chime in, any questions or if you want to piggyback, for Tom or for Regie. And you both spoke to this just now, which is great. And in your pieces that I shared out too, involve story. Is that a great place to start with writing or do you see it as more than just a tool for your own writing purposes I guess? I'll start with Tom on that.Tom Romano:There is very little I write that doesn't have story in it some way. If I'm writing that piece about the night the giant visited, I mean, it's pretty much all story, except, I think the last part in the last paragraph and that version of, did I say about giants all around us and teachers, I guess there I'm being a little bit expository. But I can't imagine writing anything that doesn't have at least the kernel of story in it, because stories appeal to us all. They are how we know the world. I mean, think about the trial that just ended. There were two stories, two arguments, but here's the story of how this went down, here's another story of how this went down.Tom Romano:For me, it's just, the story is bedrock. I guess that's why I always, when the Common Core standards came out in Ohio, well, I guess they were nationwide, and then they got rid of them, and then pretty much states just use them anyway and call them their own standards. They seem to me to really disrespect story and how I know story work in people's writing. So what did I just read? I just read an Anne Lamott book that was published in 2017 or 2018. And she said, "Story abideth." Tom just ran out of gas here, go ahead Regie.Regie Routman:No, I agree with everything you said. A story for me, I'm looking at it in a little bit different way. I'm trying to be an anti-racist like everybody else, not just talking about it, but trying to do something. And one of the ways I think that's very powerful is valuing every child's story and having them write their story and honor that story, their language, their culture that goes with it through poetry, through a vignette from part of their life, writing about something that happened that, the story of their life. And using story in a way that even though that story that you've just written was very painful perhaps, you're working with older kids, your story is not foretold by what's happened so far. But your story can be changed. And using story in that way is a part of what I'm working on now, that you have the power to rewrite your story. That might seem preordained because of your circumstances, because of your housing, lack of resources, but it's not.Regie Routman:So I see our job as educators, as being opportunity makers. And one way to do that is to get kids to write and first to value their own stories, which is so, so powerful. And then I would model, of course I would share one of my stories that shaped me. And it would be probably about my grandmother who never went to school, but never got past fifth grade because she had to support her family and didn't consider herself a writer. But when I would stay overnight with her, she'd pull out this big brown box from the top of her closet, and she was writing her stories down, but didn't consider herself a writer.Tom Romano:Wow.Regie Routman:But she was.Matt Renwick:You both speak to a sense of self-empowerment too, with Tom writing in the study halls and your grandmother writing, but not identifying as a writer themselves. And I noted in Tom's book here on page four, just your first activity here, Tom says, "Give yourself 15 minutes long if you need it, write about why you write, what you get out of it, and what rewards writing holds for you. Maybe you've not articulated that before, don't be afraid to ramble, Joey wasn't. With faith and fearlessness write through to the truth." I've heard that phrase before, "Write through to the truth." Tom, can you say more about that?Tom Romano:Write through to the truth. From last June until January, I wrote a memoir that I'm trying to find a publisher to read, and that's not always easy since it's not really a Heinemann book, or a Stenhouse book, or Scholastic book. But a lot of times I'm just trying to tell things as truthfully as I can, the way I remember, the way that I imagine it. Like that giant story, I was thinking about that. I mean, I think there's truth in there. There's a lot that's made up. And what I mean is, I don't remember that... Like I say, Joe Keester, there's a character who said, "That's Paul Bunyan" right off the bat. Well, I don't remember that happening, but my dad had a friend named Joe Keester and I found out some way that that wrestler was Paul Bunyan. And so I invented that.Tom Romano:There's a book called Inventing the Truth and it's about writing memoir. So there's a lot of places in there where I think I did invent the truth. Although I stayed close to the emotions, I'm pretty sure I remember feeling. And some of the things that were indelible memories, like when he would, I think I wrote that, "He would put forward and all his hair would go over his face and then he would go like that and comment like that, and then push it forward." That's an indelible memory. I really believe in those for sure. Now I want to get kids, whether they're elementary school kids or graduate students in a class, I want them to start trying to find those indelible moments or indelible memories. They don't usually last very long. And I want them to write about those.Tom Romano:I think the last two or three things that I have published in English Journal came from me, writing in my college class with my undergraduates. I asked them to find indelible moments. And I did that too with them and develop that into a piece of writing, which I'm trying to stay close to how I remember and how I think. Yeah. Writing through to the truth.Regie Routman:I think one of the, I used to tell the kids the secrets of what writers do, is that when they write memoir, I remember working with fifth graders on this, that you can't possibly remember what was said, what somebody said five, six years ago.Tom Romano:No.Regie Routman:So you have to invent that dialogue, but the feelings are true. And as long as you stay true to those feelings, right, it's going to work because you can't remember exactly what happened. But you do, those feelings are there.Tom Romano:You mentioned dialogue, Regie. I always thought in schools, that's the great underused form of expression, that kids don't put dialogue in their pieces. And I love dialogue. When I'm reading a novel, I love turning the page and see those indentations. I want to invent that dialogue that moves my story along. I think that makes for good reading.Matt Renwick:Really reveal characters and what they're thinking, and then move things along and apply. And as you said, evoke that feeling. And you've both used journals, notebooks, I should say, how do you use them specifically? Everyone has a different method to help, not just document experiences, feelings, and moments, but also to generate more writing and document your reading. Regie, how do you use notebooks specifically and why do you...?Regie Routman:I specifically grab my notebook and let me just find it. Start with Tom or someone...Matt Renwick:All right.Tom Romano:I have friends, Penny Kittle and Linda Reef. Their notebooks are just beautiful. I mean, they write in them, but they also draw in them and they're aesthetically pleasing on their own, I think what they're creating. And I also know that Penny, a lot of times will, if she's writing the piece for Voices From the Middle or any other publication, that she will often draft in the notebook. I don't do that. I can't do that. If I have a piece I know I'm going to write, I might doodle a little bit in the notebook, but I would get out of a yellow pad. And part of the reason I use a yellow pad instead of drafting on the computer is because I like to drink coffee and I don't want it to get cold too quickly. So I could write with my left hand and drink coffee with my other hand.Tom Romano:The way I use the journal is pretty much to collect things. People say things I noticed rambling around in my thoughts. As I told you, that I would start to write on a note pad if I had something that I wanted to write for publication. I just thought of an exception to that. When I came home from Italy in 2018, my wife and I spent two weeks in Italy and we came back, I had some things to write about and I wrote about them discursively in my notebook, went on for several pages. When I was writing in this memoir and I came to the chapter that had to do with that subject matter, I went to my notebook and typed a lot of that stuff that I used for the chapter then. I guess once in a while, I might start an article or a chapter in there. Regie, what about you? How do you use that notebook?Regie Routman:Well, it depends what's going on in my life, right, at the time. So like the article that you have for me, Roaming Around the Known with an Adult Learner, I'm working right now twice a week, tutoring, a 54 year old man teaching him to read. And so that's been pretty fascinating. And so you've got the start of the story there. Now we've been working together for 10 months. And I've always worked like this. So I have a notebook and it's just messy. But every time that I'm working with them, I'm writing down everything that he's saying, everything that we're doing, thoughts that come into my head. This is like almost a full notebook just from working together.Regie Routman:And at some point, you can see just a lot of writing there. What happened, what I'm thinking. I use it a lot for reflection and I know I'm going to write something from that. I have no idea what it's going to be. But it's the only way I can remember. I used to tell teachers, "Even though you've got all those kids in front of you, tell them, show them your notebook." Okay. Kids take out your book. I write down what just happened because I don't want to lose it. You just can't remember even the actual words that somebody said. And a lot of the kids will start keeping their own notebook. I think of it more as a place to reflect. Then I go back and look at it.Regie Routman:But this is such an intense thing that I'm involved in right now. So I have a whole notebook just devoted to that. And that's been really helpful because there's no way I could remember some of the gems that he says, it helps me with my planning and also the writing. And then I feel like I have a body of work there.Tom Romano:I mean, who knows if I'll write another book. But when I'd have a professional book, I wanted to write, I would go back to my notebooks from where the last book ended. And I would read through everything for maybe three, four years just to see what I could pick up. And invariably, I picked up stuff that I had completely forgotten about, that I was able to then use in the book.Matt Renwick:This is great. I can listen to this all day. And normally when I have more time, I send the questions ahead of time for doing a podcast or something like that. But we can tell Tom and Regie had no problems speaking very knowledgeably about this topic. But does anyone else have any questions for Tom or Regie?Virginia Soukup:Not a question. I just wanted to comment about Regie's notebook, since you encouraged me last time to start one. I have. And so I keep one at school about the different things that teachers are doing just to... Because that's what I like to write about. It's the work. So you inspired me to start that.Tom Romano:Regie, what gave you the idea to start writing in a notebook regularly? When did you start that?Regie Routman:I have no idea. I don't ever remember being told that I was a writer. I always wrote poetry for some reason, but it was the rhyming poetry. Of course, it's all free verse poetry. I don't know. I think it was... When I started this first grade book flood, what was called this experiment in this school in Shaker Heights, where the kids were all failing in literacy, I just did it. I got introduced to Don Graves' work. Maybe it was something I read from him. I don't know. But it just seemed to make sense. I wasn't smart enough to remember everything. And so I had to write it down. What are the kids saying? What are they doing? What's the plan for the next day?Regie Routman:It wasn't a notebook in the sense of the way Penny keeps it. It wasn't like I'm thinking about writing ideas. It was, here's what I'm thinking about my life, about one of the things that I did because I want those of you that are teachers like me to also be bringing your life into the classroom. So in my last book, Literacy Essentials, I interwove stories, professional and personal stories into my book and then recorded them to speak them, which I think is really important because for... And you can find that on my website, if you wanted to see that. I think for kids whose stories are not valued, their culture is not valued, and even if they're having struggle with reading and writing, they can record their stories. That's so powerful. Oh my goodness, look, I'm a writer. And then they see it in writing and it makes them feel like they're a writer.Regie Routman:So it's been always important to me to bring my life, not separate my life like this and cooking from my husband and not having hugged my grandkids yet and what that's like to bring that into school as part of the stories that I tell. And that helps kids value. "Oh, she's just writing about hugging somebody. Well, I could write about that." Or just not to separate it as their school writing and then there's home writing. I think of it as teaching, learning and living and they all go together.Tom Romano:That is a good title, Regie.Regie Routman:I know. I'm thinking about my next book because I think we separate it too much. We separate it too much. And Matt knows. We've talked about this a lot because we've become good friends over the years, is always all about relationships. Kids are not going to bare their soul if they haven't developed a trusting relationship with us, right?Tom Romano:Right.Regie Routman:And so that's true with school and it's true with real life, right? Everything is about trusting relationships. So I think they all go together. And so I don't know, I just write whatever comes into my head. So then I don't want to forget it. And then I can go back to it. I have like this. I probably have about eight notebooks over... One notebook might last me, I don't know, six months, it might last me three months, it might last me two years. And I keep everything in one notebook so that I can find it. And then I just read. So if I go to a conference, my notes are there. So I can always find what I'm looking for by the date. So I think it's a little different than just whatever works for you. But they can also keep just a simple notebook and reflect on their life and ideas and what they're thinking. And it doesn't have to be complicated.Matt Renwick:Just get it down.Tom Romano:Can I say one other thing about that?Matt Renwick:Please.Tom Romano:I think that writing in a journal notebook taught me how to write better. I wish that a teacher had told me, that had me in high school, "Keep a notebook. Start keeping a journal." Because I didn't start writing in a journal until I was about, I would be about 24 years old in the summertime I was taking classes. I read Daniel Fader's Hooked On Books. And one of the things that, he had them reading paperbacks, huge new thing then, right. Having these juvenile delinquent kids read paperbacks, and then also keep a journal. And I thought, this is just the thing for... I had some kids in a class ignominiously titled Basic Skills for juniors in high school would not turn you on. But I thought, this is perfect for those kids to help them write a journal. And then I thought, well, I better do this myself if I'm going to have them do it. And man, I've been hooked on that ever since.Matt Renwick:Yeah. Both of you as the adults in the room or the teachers in the room, you go first and then the kids follow. This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit readbyexample.substack.com

Pat talks about 420, Brewer And Shipley's "One Toke Over The Line" interview with Tom Romano, your phone calls and Pat always has a Parsec meter!

We made it to Episode 36 of the Behind the Golf Brand Podcast. In this week's episode, I interview my friend Tom Romano the General Manager of Galvin Green in North America. Galvin Green is a pure golf brand specialising in the design and supply of high-performance clothing to golfers in more than 20 countries worldwide. Designed by golfers for golfers.Support the show (https://legiongolf.co/)

In the Travel News, we discuss how the border to Mexico is closed. But if you fly ABOVE the border, it’s a different story….an interesting story for sure. How thousands of Americans are vacationing in Mexico. Favorite guest Ed Perkins is on board to discuss how and when he sees travel coming together. Ed’s been writing about travel a long time, so his opinions might be of high value, just because of his experience. When are Smart Travelers thinking about returning to the road? It just depends on your personal feelings. The back half of the program includes a special farewell to a fellow traveler, and a few behind-the-scenes stories with the show’s only hosts in its ten-year run, Tom Romano and Mark Hoffmann.

Mike & Harris sit down with Tom Romano, the founder and owner of Mosaic Craft Beer, Cocktail & Wine Bar in Astoria, Queens. Subjects covered include nightclubs, Covid-19 and the adaptations that the restaurant industry have embraced, to-go cocktails, and howling like dogs.

In this episode, Dr. Tom Romano answers Beth's and Noah's questions including, "What do you want teachers to know" and "What would you like to see when it comes to the role of narrative in writing instruction?" Of course, we also spend a big chunk of time discussing multi-genre research...and more! Want to know more about OWP? Follow us on Twitter and Instagram: @owpmu Facebook: https://www.facebook.com/OWPMU

On the Sunday, February 17th edition of The Travel Guys… Steve LaRosa is in for Tom Romano and joins Mark in the studio. In the Travel News, United Airlines is offering TV for free.  That’s on the 211 aircraft which have the in seat back screens.  Previously there was a charge, but now you can watch the screens or on your own device for free.  Southwest Airlines has declared a “operational emergency.”  It appears a...

Hello and welcome back to the Symmetry Delta Podcast for evidence based investing. Today, we're joined by Symmetry's Tom Romano, the Director of Sales Operations. Many advisors reside within hyper-competitive markets. In this second part of "Blueprint for Success," we'll learn more about how advisors can pin-point their own advantages and develop targeted business strategies. Visit us at www.symmetrypartners.com. You can also find us on Facebook, YouTube, Twitter, or LinkedIn under Symmetry Partners, LLC. If you have any questions or would like more information – give us a call at: 800.786.3309.   Symmetry Partners, LLC, is an investment adviser firm registered with the Securities and Exchange Commission. The firm only transacts business in states where it is properly registered, or excluded or exempted from registration requirements. No one should assume that future performance of any specific investment, investment strategy, product or non-investment related content made reference to directly or indirectly in this material will be profitable. As with any investment strategy, there is the possibility of profitability as well as loss.  

Hello and welcome back to the Symmetry Delta Podcast for evidence based investing. Today, we're joined by Symmetry's Tom Romano, the Director of Sales Operations. Many advisors reside within hyper-competitive markets. In this episode, we'll learn how advisors can pin-point their own advantages and develop targeted business strategies. Visit us at www.symmetrypartners.com. You can also find us on Facebook, YouTube, Twitter, or LinkedIn under Symmetry Partners, LLC. If you have any questions or would like more information – give us a call at: 800.786.3309.   Symmetry Partners, LLC, is an investment adviser firm registered with the Securities and Exchange Commission. The firm only transacts business in states where it is properly registered, or excluded or exempted from registration requirements. No one should assume that future performance of any specific investment, investment strategy, product or non-investment related content made reference to directly or indirectly in this material will be profitable. As with any investment strategy, there is the possibility of profitability as well as loss.    

In this episode, you will learn about how listening to your customers can open up many doors from Mark Hoffmann. Mark Hoffmann is president and founder of Sports Leisure Vacations, Sacramento’s largest and oldest packaged tour and travel company. There he orchestrates the company’s many facets of operation from escorted tours and travel agencies services to receptive, meeting, planning, and incentive travel programs. Sports Leisure Vacations was founded in 1979 and has an active client base of 8,500 plus members. Mark was a sports talk show host on KSAC 1240 AM from 1991 to 1994. He has co-hosted the Travel Guys with Tom Romano since February 2009 on KFBK 1530 AM and now 92.5 FM. He enjoys radio announcing and confesses it has always been a dream of his, a dream that has come true twice now. Mark proudly served as president of the National Tour Association in 2000 and 2013, the country’s most prestigious tour operator association. His mission is to be a strong and vocal advocate for all aspects of the tourism industry. He feels the industry should be proactive in increasing positive public awareness about the value of tourism, especially among elected officials. Mark holds the designation of Certified Tour Professional as given by NTA along with a host of other honors and awards. A two-time president of the Mather Sacramento Chapter of Toastmasters International, Mark’s numerous speaking engagements have focused on such topics as marketing to tour operators, how to make marketing more effective, the nuts and bolts of group tour marketing, looking through the crystal ball: the future of the hospitality industry in America, and off the beaten track: America’s backroads. An avid traveler, Mark’s favorite destinations are New York City, the length of Route 66, and the Main Street of America. A transcript of this episode is available here: http://destinationontheleft.com/mark-hoffmann/

buying airline tickets from 3rd party websites, Napa Valley ready to receive tourists after wild fires, Tom Romano in Florida talk about amusement parks, Kite flying in Long Beach Washington and a contest: how do you choose your flight seat partner?

buying airline tickets from 3rd party websites, Napa Valley ready to receive tourists after wild fires, Tom Romano in Florida talk about amusement parks, Kite flying in Long Beach Washington and a contest: how do you choose your flight seat partner?

Tom Romano, author of Crafting Authentic Voice and Zigzag, and Penny Kittle, author of the NCTE award-winning Write Beside Them, discuss the important place of voice in student writing. Learn more... Visit Heinemann.com for K-College professional development books and services, teaching systems, and innovative multimedia tools for educators.