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A bite sized discussion on timely financial news and investment topics, to help you maximize your net worth and wealth for the next generation with Justin Dyer and Mena Hanna of AWM Capital.
Justin Dyer: Hey
everyone.
Welcome back to another
episode of a WM Insights.
Uh, and we're happy to report.
We, we are officially
back This, uh, this
past week, week's episode
wasn't just a little, uh,
teaser.
We're, we're, we're
gonna get
this back on the calendar on a
weekly basis to keep you informed,
answer questions,
um, and just overall.
Uh, um, give, give our perspective on
what's going on in, in the markets.
So if you do have any questions,
definitely reach out to us.
We wanna make sure you stay informed and
hopefully, uh, slightly entertained you.
You've got two CFA here, two
CFAs here, so we'll do our best.
You know, we're not necessarily
the, the most jovial folks, uh,
out there, but we will, we will
do our
best.
Like I said, um,
we're recording on Friday.
April
11th.
It has
been a wild week.
Uh, if you haven't been
paying attention, uh,
probably a good thing.
Hopefully you've, you've just had your,
your head in the sand or, uh, on
vacation or, or focused on the season.
Um, that would be a, a great, uh, uh,
a great plan
of attack.
It's been a wild one.
There's been,
Mena Hanna: been, uh,
Justin Dyer: uh, days both positive
and negative that are, that are really
for the record books in a sense.
Um, and
we're gonna, we're gonna kick it
off today, just going back to some
of the.
Great old
tenets
of portfolio
management, of the, the, the concepts
around controlling what you can control,
giving, uh, you just a little bit
more color on how we think about, um,
managing through these volatile times.
So, Mina, why don't you take it away.
Give us a,
give us a
sense, what does it mean to control
what we can control in times like this?
Mena Hanna: Yeah.
And with markets
moving as quickly as they're moving,
there's, there's little you can do in
terms of reacting.
So preparation really is the start.
We talked about this last week, but
when we actually started this week.
We did
a pretty
substantial review and our client
portfolios are, are prepared, they're
positioned accordingly, and these
moves didn't harm our clients from the
standpoint of short term spending needs
or money that's actually needed now.
So
I.
That,
that money, the Protective
Reserve strategy,
has been vent, very
useful and kind for our clients,
and we're prepared and we're
prepared to ride out storms.
This has definitely been a significant
storm, but we've, we've made it past it.
Um, and.
Wednesday was kind of a
historic market rally day.
So, um, we did a lot of things
on Monday and Tuesday, including
a lot of tax lost harvesting.
That's one thing that
you can
do during down markets,
Justin Dyer: which real quick
for, for, for those of you who
don't know that, that term, right?
It's, it's selling a position, harvesting
the loss, hence tax loss harvesting.
You get that for tax purposes, but then
you're buying something very similar.
So your investment exposure
essentially remains the same.
Um, and it's a, it's
very, I wanna say, uh.
Common
practice.
If you're, if you're
not doing that, you,
you definitely
should have someone doing that
for you within your portfolio.
'cause it does add
substantial long-term value.
Mena Hanna: Absolutely.
Yeah.
Some of our clients had positions
sold on Monday and Tuesday and
on Wednesday they
rallied 10%.
So pretty, pretty
substantial losses realized.
And then, um, some, some unrealized gains,
which we do like to see in portfolios.
And then really the last thing is in
terms of our baseball
clients in season flows.
Really our clients are getting
paid at at a great time.
Markets are down, valuations are down.
You have consistent inflows.
When you do have consistent
inflows, you can invest at
these new lower valuations and
you can really pad
your portfolio for the recovery
that ideally is to come.
Justin Dyer: That's awesome.
Alright, uh, we get to work
on our game a little bit.
Our, our stat game.
We're CFAs, we love numbers.
Go through, through it.
We've talked about
the, this week being one
for the ages.
You kind of alluded to it.
Let's just unpack a couple of the
big, big numbers that we've seen here.
Again, go both good and bad.
Mena Hanna: Yeah.
I think
one of the, one of the most
interesting numbers is.
This
Wednesday, I should say, after tariffs
were paused, it was the eighth largest
percentage day gain by the s and p 500.
It was up 9.5.
Justin Dyer: in the history of the s and p
Mena Hanna: in the history of the s and p
Justin Dyer: be clear.
That's wild.
Mena Hanna: So yeah, more, more than a
hundred years of data.
It was
the eighth best day and yeah, think about
how many days are in a hundred years.
A lot.
Um, so, so yeah.
Very, very large move.
We talked about this a little bit
before, it was the largest point gain.
I think we saw a lot of reports on that.
That doesn't mean much because the index
continues to, to
move up, but I, I guess you can say it
was historic from the standpoint of, of
points, most points gained in one day.
Um, but want to really
refocus, I guess, the significance
of that one day around this
really interesting point that.
Uh, we, we found
during, during our, one of our due
diligence processes, if you look at
the S&P's average return over the last
10 years, it returned 12% on average.
If you remove
the 10 best trading days from every
single year, your return is negative 10%.
So not only did those 10 days account
for all of the gain, but they
actually made up for 10% of the losses
as well.
So really it's,
I think the lesson here is
it is so
important to stay invested, to ride
out these storms, to not get cold feet.
And on Tuesday, you know, morning.
Sell out
of the market and
then miss the rally that, uh, really
would solidify losses and prevent
you from making your money back.
Justin Dyer: Yeah.
It, it, it's huge.
And you know, I, I kind of jokingly
said, let's work on our stat game.
Uh, but your last point is,
is
incredibly important.
We, we, we have these principles,
stay disciplined, stay focused
on the long term, don't try to time
the market, et cetera, et cetera.
And I think maybe I'm making a,
an assumption here, but sometimes
those can just sound like sound
bites, uh, coming from us, however.
They are always rooted
in some form
of rigorous data.
And this is a perfect
example of that, right?
We don't just
say stay disciplined, we don't just say
focus on the long term.
We
say
that because it actually has
very strong data to back it up.
And I think that's a
great, great takeaway.
Um, we're gonna wrap here
and just really want to wanna
level set quite honestly, that.
I think more
volatility is expected.
There's a lot of uncertainty.
We are not out of the woods
with respect to
this tariff war.
We don't know what's
going to come out of it.
We don't know if
it's gonna
be solved on Monday and markets will
rally further, or this could be long and
and
drawn out.
Um.
Events and, and
negotiations.
The portfolios we build are
prepared for that uncertainty
and that volatility.
But, um, I would expect it,
I really
would, hopefully we're pleasantly
surprised, and that's not, not the, not
the case, but given that expectation, it's
just a great
reminder to, to tune out the noise.
Like Mena said, the, the headlines are
highlighting that the, the, we had the
greatest point rally in S&P history.
That doesn't matter.
The percentage is what matters.
So there's a lot of headlines
that we're gonna see
throughout this
period of time, and all they are
trying to do are get you to click
on it and capture your eyeballs.
They are not trying to keep you invested
for the long term, and
there to stand by your
side over that period of time.
That is our job.
That is what we are here to do, and
we really, really want you to hear
that message and, and remember that.
So, uh, with that, we'll,
we'll conclude, uh, with.
Own your wealth, make an
impact, and always be a pro.
We'll see you next time.
Bernard: The information in this podcast
is educational and general in nature,
and does not take into consideration
the listener's personal circumstances.
Therefore, it is not intended to be a
substitute for specific, individualized
financial, legal, or tax advice
to determine which strategies or
investments may be suitable for you.
Consult the appropriate
qualified professional prior
to making a final decision.