Forever Is A Long Time

by Bill Parrott on

Financial planning is important, but life planning is better. A financial plan indicates a finite service, a one-time event. Life planning takes financial planning to a higher level. It’s enduring, vibrant, and active. It’s proactive. It’s forever, and forever is a long time!

I’ve run several...

Do You Have the Right Map?

by Bill Parrott on

Having the right map is paramount if you want to arrive at your destination. Navigating the high seas and distant lands requires a detailed map, so does driving across town to pick up a gallon of milk. A map of Los Angeles is of little use in New York. A ski map of Crested Butte provides no guidance...

Cash is King!

by Bill Parrott on

Cash is King! The King is Dead! Long live the King! An unusual thing is happening this year – cash is outperforming stocks and bonds. Allocating your investments to T-Bills has been a winning trade this year.

According to Deutsche Bank, 90% of the 70 asset classes they track are in negative...

Rates Have Risen

by Bill Parrott on

When interest rates start to rise, stocks will fall. Not only will they fall but our economy will tumble into a recession. Corporate credit will evaporate. Home ownership will cease. All dire consequences.

It’s true, rising interest rates do cause economic headwinds. But rates have been rising. In...

A Few Things I Know

by Bill Parrott on

Most markets have struggled during the months of October and November causing angst and worry among investors. Media commentators, reporters, and online personalities are bellowing from their pulpits about the pending doom in the markets and economy. If these experts were asked to help contain a...

Too Good to Be True

by Bill Parrott on

The Wall Street Journal reported on a firm that went belly-up due to “bad bets on energy prices.” The firm, OptionSellers.com, sold options on future contracts and they suffered a “catastrophic loss” on their trading strategy.[1]

As a result of the firm’s trading losses, some of their clients lost...

Expectations

by Bill Parrott on

At the beginning of each football season every NFL team has high hopes of winning the Super Bowl, even the Cleveland Browns. Enthusiasm and expectations are high.

During the 1970s the Minnesota Vikings were one of the most dominant football franchises in the NFL, winning 78% of their games from...

My Two Best Days

by Bill Parrott on

Tommy Lasorda once said, “The best possible thing in baseball is winning the World Series. The second-best thing is losing in the World Series.” He added, “When we win, I’m so happy I eat a lot. When we lose, I’m so depressed, I eat a lot. When we’re rained out, I’m so disappointed I eat a lot.” Mr....

Slow Money

by Bill Parrott on

CNBC’s Fast Money is “America’s post-market show to bring you the actionable news that matters most to investors.” The panel of traders discuss stocks, ETF’s, options, and bitcoin. They talk in technical terms and use graphs and charts to highlight their main points. They sound convincing and make...

Models

by Bill Parrott on

A few months after the Great Recession a writer for a national magazine asked a simple question: “Did asset allocation models let down the individual investor?” I don’t think they did because conservative models lost less money than aggressive ones during the meltdown. In other words, the models...

Correlation: Positive One

by Bill Parrott on

A diversified portfolio is always recommended. Balancing your accounts between stocks, bonds, and cash will allow it to grow with less risk than a concentrated portfolio.

A key metric to determine how well diversified your investments are is the correlation coefficient. It ranges from positive one...

Marathon Investing

by Bill Parrott on

Running a marathon with 30 or 40 thousand runners is chaotic – especially the start. When the gun goes off the crowd surges forward, so you better be ready to run or you’re going to get steam rolled. It’s pure emotion and adrenaline.

The first few miles are crazy as runners try to find a little...