Quick Hits: Tailwinds! | Home Prices vs Inflation | 3 Proactive ways to engage

With the unprecedented volatility the time to shine as an advisor is now!!

We need to be marketing like crazy!

• Calls, emails, text.
• Proactiveness is where you’ll help people in need while their brokers are hiding under their desks.

Here’s 3 Proactive Ways to Engage and Connect with Prospects & Clients

1. Rebalance their portfolio / take gains off the table
   1. For many the market feels worse than it really has been.  It’s down 12% ytd and now flat the past year.  After big gains in 2023 and 2024, it’s a good time to take some gains off the table and rebalance your clients asset allocation. 
2. Identify buying opportunities
   1. This could be in the equity or fixed market. 
3. Make tax-efficient moves while the market is low.
   1. Make the move from taxable to non-taxable while assets are low. 

Waiting is not a strategy – action is! 

Here are your Quick Hits:

7 Financial Terms Advisors Often Misunderstand

• Great piece to email out this week.
• Index Funds Are Not Always Passive: While index funds are designed to track market indices, utilizing multiple index funds, including those focused on specific sectors or employing strategies like smart beta, can introduce active management elements into a portfolio.
• Misconceptions About Alpha: Alpha represents the excess return of an investment relative to the market index. By definition, the average alpha across all investors is zero before costs and negative after costs. Advisors should be cautious of benchmarking practices that may inadvertently misrepresent performance, such as comparing portfolios to indices that exclude dividends, leading to an overstatement of alpha.

How to Make 267%—or Lose 90%—on Treasury Bonds

• Crazy stories here!
• High Risk and Reward of Leveraged Treasury ETFs: Leveraged and inverse ETFs tied to long-term U.S. Treasury bonds can result in extreme outcomes. For instance, investing in these funds at their peak in August 2020 could have led to a 267% gain or a 90% loss, depending on market movements. ​
• Compounding Effects of Daily Resets: These ETFs reset their leverage daily, which means that over time, especially in volatile markets, the compounding effect can lead to significant deviations from expected returns. This characteristic makes them more suitable for short-term trading rather than long-term investments.

The Ultimate Guide to Home Price Appreciation

• Who doesn’t love a good chart?