When Being in the Top Percentile Doesn’t Pay


Would you like to have your investment portfolio or your workplace 401(k) managed by the top 15% of all money managers in the world?

It’s a serious question: Having a professional who is considered to be in the top 15 out of 100 money managers in the world managing your money.

When I ask this question most investors say, “Sure, that would be great! How can I do this?”

The answer is very simple. Just invest in the Standard and Poor’s 500 Index (S&P 500). In the past 14 years the S&P 500 beats 85% of all money managers out … Read the rest

What’s Motivating Your Financial Advisor to Help You?


Imagine this scenario: You haven’t been feeling well, so you decide that a trip to your doctor is in order. After the exam, your doctor writes out a prescription for Drug A. You then proceed to the local drugstore to fill your prescription.

Two weeks later, you discover that your doctor moonlights as a pharmaceutical sales representative for the same company that makes Drug A. So by prescribing Drug A for you, that doctor received a commission from the drug company.

What’s your first reaction? Is it one of skepticism? Do you question whether or not you really needed Drug … Read the rest

The Indicators


I’m starting to get a reputation in this industry for talking a lot about my market indicators. From my “Two-Minute-Tuesday” weekly update videos to normal conversations with clients, I somehow always revert the discussion back to the indicators.

It’s time to reveal what my indicators are.

First, let’s clean up a major misunderstanding. The indicators I use are not on/off switches. I don’t have any flash-in-the-pan indicator that says, “Hey last week the President tweeted this and that, which will most likely be well-received by the markets. So you need to go all-in, Mr. or Mrs. Client.”

My indicators don’t … Read the rest

Boiling the Frog


We’ve all heard the old fable about the “Boiling Frog.” In the story a frog is placed in a large pot filled with cold water. He’s very content with not a care in the world. Then someone comes by and fires up the burner. The water in the pot slowly begins to get warmer and warmer. But the frog is not concerned, as he finds the warmth refreshing. The heat keeps gradually rising until the frog has become so relaxed he falls asleep, never to awaken.

This story reminds me of today’s investors, including individuals with IRAs, 401(k)s and other … Read the rest

Chasing the Cash


I recently received an interesting text from a client which inquired “In your weekly ‘Two‑Minute‑Tuesday’ video market round-up, you stated that your main intermediate indicator had shifted from ‘Offense’ to ‘Defense.’ Given the election last fall, I’m nervous. Should we just sell everything and go to cash?”

The short answer to that insightful question is “No.”

You see, selling all of your investments and converting to 100 percent cash is an aggressive move. But for me to make this bold move, there would have to be absolutely nowhere to hide and no hope for the any of the six primary … Read the rest

How to Get Into Position for a Market Hit


Imagine a scenario where the market drops 20 percent this year. Sounds drastic, but in fact it did just that in 2001, and again 2002 and once again in 2008. Back then, many investors used the majority of the next big move up just getting back to even instead of making money. (See my article, “Two Beers, a Napkin and a 401k,” May 2013, Agency Sales).

But suppose in this scenario you were able to avoid the “big hit” and experience a flat return or just a minuscule loss. Wouldn’t you agree that you’d be in good shape going … Read the rest

The Benefits of Exchange Traded Funds


To best explain what an Exchange Traded Fund is, let me first explain what a mutual fund is. Mutual funds, like ETFs, are a basket of investments typically made up of stocks, bonds, commodities and/or currencies.

When you invest in a mutual fund, you’re investing in terms of dollars, not shares. The reason for this is that you never know exactly what price you’re going to pay because you get the closing price of the fund on the day that you buy it. So you say, “Okay, let’s put $10,000 into this mutual fund.” You don’t say, “Let’s buy 217 … Read the rest

When the Market Plays Chutes and Ladders


One of the most frequent questions I’m asked in the course of my business is, “Why does the market behave the way it does?”

There is an old saying on Wall Street that the market climbs up the stairs but comes down on the elevator.

That’s really a true picture. I have found in more than 28 years as an investment advisor that the market, in its same old boorish way, slowly and steadily grinds up until…BAM! Five percent down in a couple of days or 10 percent down in a week. It happens. Maybe you’ve experienced this phenomenon yourself … Read the rest

The Crowd Can Make You a Millionaire


Have you ever had the opportunity to watch the program Who Wants to Be a Millionaire? The premise of the hit TV show focuses on a contestant who selects one of four multiple-choice answers to a trivia question. The more questions they answer correctly, the more money they can win.

But, of course, the questions get progressively more challenging, so the contestant is offered three “lifelines” when they’ve become stumped on a particular question. One lifeline is called “50-50” where the computer takes away two of the wrong answers and leaves the contestant a 50-50 chance of guessing the correct … Read the rest

Game-Changer Investing


Stick With the Plan, Stan

Augusta National Golf Club in Augusta, Georgia, will once again play host for the 2016 Masters Tournament, slated for April 7th. If you’re a golf fanatic like I am, I’m sure you’re anxiously anticipating the showdown between the sport’s newest generation of superstars like Jordan Spieth, Jason Day and Rory McIlroy.

The Masters Tournament challenges its vaunted participants by forcing them to develop a disciplined playing strategy that is centered on their individual strengths and weaknesses. A winning game plan that the golfer can trust even after the dubious double-bogey on the famous 13th hole. … Read the rest

Are You Properly Nurturing Your Money Tree?


Gather ‘round people and let me tell you the Parable of the Poor Farmer.

Not so long ago there was a poor farmer who lived in the land of Opportunity. He was really smart and had learned his lessons all too well. He knew that if he worked hard he would do well and be able to provide plenty of food for his family while still having some produce to sell so that he could buy more seeds for the next planting season.

In the early years the poor farmer barely managed to eke out a living, but he was … Read the rest

Adapting to the Markets Puts Points on the Board


At my firm, Balser Wealth Management, we like to say that we spend every waking moment being very concerned about your money. About how you earn your money, how you invest your money, and how your money is contributing to a happy, healthy lifestyle.

But in reality, sometimes our thoughts drift. This is particularly the case during football season when I find the most creative ways of relating the events of the workday to my beloved Dallas Cowboys and my fantasy football teams.

When I’m discussing with a client the stellar performance of a particularly strong ETF (Exchange Traded Fund), … Read the rest

The Dangers of Predicting Your Retirement


If you’re more than 50 years old and reading this article, I’m pretty positive that these two questions have entered your mind lately: “When can I retire?” and “How much money will I need to live a comfortable life in retirement?”

To be honest, they’re pretty reasonable questions to ask yourself. And based on my experience in the wealth planning world, most individuals answer these questions in one of two ways.

  • The first answer — and probably the most costly — is found by hiring a financial planner. That’s the well-dressed guy who meets with you and your spouse and
  • Read the rest

Pie-Eyed Over Pie Charts


If you’ve ever worked with a stockbroker or financial planner, you’ve most likely been subject to a barrage of fancy-looking pie charts. Asset allocation models have been displayed in this graphic format since the pie was first invented, it seems.

Pie charts are standard tools that one views when meeting with a stockbroker or financial planner. I like to call these folks “pie-charters” because their recommendations are usually all the same. It doesn’t matter which firm you’re working with, when you’re meeting with your financial planner or stockbroker they always recommend a blend of growth vs. safety investments and fixed … Read the rest

It’s Time to Separate Fact From Fiction


MythBusters is an increasingly popular TV show on cable’s Discovery channel that uses entertaining science to uncover the truth behind well‑known myths and legends. From determining whether it’s possible to beat police radar detectors to whether a bull really can cause destruction in a china shop, the hosts mix scientific method with good old-fashioned ingenuity to separate fact from fiction and set the record straight on our mainstream thinking.

Perhaps MythBusters could make a visit to Wall Street, since there’s been a lot of market talk lately that really makes it hard for everyday investors to separate fact from fiction. … Read the rest

Can Playing Poker Make You a Better Investor?


The other day I turned on the television and there was Lon McEachern and Norman Chad from ESPN calling the World Series of Poker tournament live from Harrah’s Resort & Casino in Las Vegas. As I watched the broadcast my mind began to wander (as it often does), and I began to think about how the game of poker is a great analogy for what I do in real life.

Now I’ve played a lot of poker in my life, and I can assure you that the game really has nothing to do with gambling. When I sit down at … Read the rest

Did You Miss the Last Market Run-Up?


Here are two questions I’m frequently asked during the various keynote speeches I present to trade groups around the country:

  • “How do you make sure clients don’t miss the run-ups in the market?”
  • “How do you protect clients from another financial disaster year like 2008?”

Frankly those are two very tough questions that would cause most financial advisors to quickly turn and run.

Let’s face it. In 2008 the markets had a catastrophic meltdown that continued into the first quarter of 2009, with upwards of 25 percent added on the downside.

Then the markets turned on a dime and began … Read the rest

Mission: Impossible


Is It Really Impossible to Beat the Market?

For much of the last 25 years, most of the media and investment management world have promoted the idea that individual investors can’t beat the market. And it’s true. You can’t beat the market. That is, unless the stocks or mutual funds you own are, in fact, beating the market!

There is no way on earth you could ever beat the market if the stocks or mutual funds you hold are not keeping pace with the market, or with any luck, staying ahead of the market.

However, that’s what the majority of … Read the rest

Do You Have Time to Stop and Lace Up Your Sneakers?


Did you hear the one about the two guys out camping in the woods when a big grizzly bear strolls into their campsite? As the one guy starts running, the other pauses to put on his sneakers.

“What are you doing?!” the first guy yells out. “You’ll never outrun the bear!”

“I don’t have to!” his partner replies. “I just have to outrun you!”

If you have been keeping up with my column you may have learned the theory behind my investing approach, which is sort of like the story above. One of the processes I use to manage my … Read the rest

“Pound for Pound”


Comparing the Relative Strength of Humans, Horses and Your Investments

Have you ever heard the expression that describes an athlete as “pound-for-pound” the strongest, referring to the relative strength of that individual? This comparison phrase is what coaches use to measure strength levels for athletes of varying body weights.

For example, a large athlete may be able to lift a much larger amount of weight than a smaller athlete. However, the smaller athlete may be lifting more weight relative to his or her body weight than his larger counterpart. To help a coach figure this out, the “pound for pound” … Read the rest

The Most Wonderful Time of the Year


You’ve spent months preparing for this moment. You’ve missed backyard BBQs, given up vacation days and blown off the family to devote time and effort to research, analyze and make predictions. And now, you’re fairly confident that all your hard work will pay off to make this “your year.”

You guessed it — It’s time for Fantasy Football.

At this time of year, Thursday through Monday means only one thing to many Americans: football season is back in full swing. Fans will be glued to their computer screens for the next four months as they track plays and performances while … Read the rest

Capital Vices: The Seven Deadly Sins of Retirement Mismanagement


Perhaps not now, but at some point, you’re going to have to survive on the dollars that are stashed away in your retirement account. That 401(k) is fun to watch when you’re in your early working years because it doesn’t seem like it’s real money. It’s just a paper statement that arrives every month with a whole bunch of numbers on it that usually gets thrown into a drawer.

But as the years fly by, reality sets in and it suddenly dawns on folks that one day they’re actually going to need that money. That’s when people start paying a … Read the rest

A Day at the Races:
Stepping Up to the Betting Windows of Investing


With the 140th “Run for the Roses” fast approaching, my thoughts have turned to the Kentucky Derby and horse racing in general. During “Derby Week” the city of Louisville comes alive with the sights and sounds of rabid horse racing fans. If your only familiarity with horse racing is a weekday afternoon at your friendly neighborhood racetrack (many of which sit empty even on the weekend) then it’s probably difficult for you to picture exactly what the Kentucky Derby is like.

The place is filled to capacity. “Millionaires Row” is crowded with A-list celebrities. The grandstands teem with cigar smoke, … Read the rest

Understanding the Risk-Reward Sides of Investing


It’s April and spring is in bloom. For many of us spring means the much-awaited arrival of crocuses, green grass and, of course, the Masters golf tournament at Augusta National in Georgia. This very exclusive event represents the Holy Grail for the golf world. And where every major golf course around the world has its promoted signature hole, Augusta National boasts a signature corner consisting of not one, but three very tough — but stunning — signature holes.

“Amen Corner” was the term coined by Herbert Warren Wind in his 1958 Sports Illustrated article chronicling that year’s tournament. It’s the … Read the rest

The Times They Are A-Changin’ the Case for a “Structural Bull Market”


As we roll into 2014, our theme for the U.S. Equity market is we are in a “Structural Bull Market.” This is a change from the past 12½ years. Since early 2001, I believed we were in a “Structural Fair Market.” In a Structural Fair Market there could be several periods where the stock market can run up 20% and several periods where the stock market can drop 20%. And when the dust settles — you’re usually right back where you started. And that’s essentially what happened. Now we believe we have entered a Structural Bull Market. The last Structural … Read the rest

How Much is an Investment Manager Going to Cost Me?


I know I need a new driveway. My present driveway sports a host of large cracks that make driving on it akin to traversing the surface of the moon. But I’ve been putting off getting a new driveway because I have absolutely no idea what I’m going to pay to have one poured, and I really don’t have the time to make phone calls to driveway companies to compare prices. And since those companies don’t generally list prices in their ads, I’ll remain in the dark and put up with the daily bump-filled ride to my garage.

Most people I … Read the rest

Investment Advice From a Wise Man


As the bartender delivered our appetizer dish, my friend Steve glanced up from his recently opened retirement statement and quipped, “Roger, where did you learn all of this stuff about investment strategies? I’ve known you since your college football days, and I know you’re not smart enough to make this stuff up on your own.”

Steve was right. (Even about the intelligence part.) In the 30 years that I’ve been in this crazy, erratic business, I’ve been fortunate enough to learn a trick or two about investing. But his question took me back to my early apprentice days working as … Read the rest

Mutual of “Oh My Gosh!” —
The Wild Kingdom of Selling Mutual Funds


When it comes to stock brokers pushing mutual funds and investment advisors pushing those same mutual funds, the feeling is definitely not mutual.

OK, that’s a serious overuse of the word “mutual,” but I feel it’s in your best interest as a responsible investor to know the difference between the two worlds of selling mutual funds. And you may be surprised at what you discover.

A few weeks ago I had a very interesting conversation with a colleague, and he shared this story with me.

Watson sits on the endowment committee for his local church in Cleveland, and they work … Read the rest

Is Your Financial Advice Coming From a Butcher or a Dietitian?


The difference between a stockbroker and a financial advisor can be equated to a nice meal today vs. a long-term healthy diet.

Picture in your mind that you’re making a special guest appearance on the “Tonight Show” with Jay Leno. The first question out of Jay’s mouth asks you to explain the difference between you and everyone else in your industry.

Could you do it? What would you say? Could you fire an answer back to Jay without grasping for the right words or “winging it” as most folks would be prone to do?

I’ve gone through this exercise a … Read the rest

Two Beers, One Napkin and a 401(k)


What would you do if you found out your investment was earning less than one percent a year? Would you review your investment and make some changes or would you take a “wait-and-see” position?

The reality is that lots of good folks are sitting idly while their retirement plans wallow. The tragedy is that a good portion of these folks aren’t even aware of just how badly their plans are performing, or even worse, that they have the ability to alter their plans with some basic information.

Here’s a discussion I had recently with a close friend that proves my … Read the rest