The Revolution Partners Investment Committee recently released a market commentary to our clients. In summary, we have been following the United States markets with growing concern. Virtually every metric we monitor on a weekly basis indicates that both equity and bond markets, not to mention real estate generally, are overvalued.
As stewards of our clients’ assets, we treat them as if they were our own, and we are positioned for a noticeable pullback in equity prices and a continued rise in interest rates.
Broadly, we recommend keeping these four things in mind to stay prepared for market changes:
1. Have a plan.
How would a considerable pullback in the U.S. Markets effect your financial plan? Do you have a retirement accumulation and distribution plan? Do you know the required annual rate of return to stay on track? To consider whether a plan can help you keep natural impulses in check, read our post, "Five Traits That Make Investors Their Worst Enemies."
2. Know what you own and why you own it.
Do you understand the characteristics and potential risks of what you own? Are you receiving objective advice on the products in your portfolio? You might be interested to read our post, "All Will Be Revealed: Is your portfolio too complex and expensive?"
"Do you want an advisor who is merely required to make suitable investment recommendations? Or, would you prefer an advisor who actively takes a role in helping you achieve your financial goals by recommending investment solutions that are in your best interest? You deserve to know what obstacles might be standing in the way of your receiving the best advice possible." - Brian Fowler
See our guest column about fiduciary responsiblity in the Memphis Business Journal.
3. Don’t stretch for yield in a low-rate environment.
Are you invested, directly or indirectly via a mutual fund or ETF, in junk bonds or long-dated fixed income with higher yields but considerably more risk? We watch interest rates along with many other market-influencing factors, and you can read our 2016 thoughts on this topic, still relevant, in our post, "Don't Complicate Your Mind."
4. Beware of “Advisor Diversification.”
Are you working with multiple advisors? You may find yourself with risks like unsuitable asset allocation, unnecessary tax consequences and higher fees. Click the image below to learn more.
The Revolution Partners team of professionals is here to help you make informed, discerning choices with a range of services to fit your needs.