Hello, and welcome to our year end Market Alert video and this is the one where we are going to review 2023 and what happened this year. It’s been a very eventful year, and when we look back on it, it’s like, wow, it’s hard to imagine that all those things happened. And so we’re going to have a walk down memory lane with you. But also, one of the things that we always tell you is that we want to worry about all of this boring financial stuff so that you don’t have to. And we say, you know, I joke around and I say, we want to get the gray hair so that you don’t have to. And so I want to show you, this right here is actually what I looked like at the beginning of this year in January. And look, now look at the difference. I mean, that’s incredible. I’ve aged 32 years in just one year. That’s how much has happened this year. So anyway, let me share my screen with you. And let’s, let’s review 2023, and your Investment Oversight Committee at work. So the first thing that I want to do is I want to go over that, as you guys know, we sold our equities in April of 2022. And we bought back when the market was lower in February of 2023. Now when I say the market, what I’m referencing is going to be the S&P 500 index. So if you look at this chart, what you can see here is that we sold when the S&P when the market was here in April of 22, and stayed out for a good deal for nine months before we bought back in and we bought back in here where it was lower. Now the interesting thing about this chart, especially for those of you who are SCWPerS is that you’ll note that almost during the entire nine month period, here, the market was below where we sold, this is important because you’ll notice these big downturns here, if your investments are dropping like this, while you are living on your money and you’re taking money out every month, what that happens, what happens is that you have to sell more shares to get the same dollar because the share values have gone down the prices of your investments have dropped. And and if you do enough of that, that can be very bad. And so you know, we actually say it’s kind of like farmers eating their own seed corn. And you know, if you eat enough of your seed corn, then yeah, grow season may come, but you may have eaten all your seed corn have nothing left the plant. So by avoiding big drops in your investments, when you’re taking money out, that’s a very important thing that we want to do. Now, the other thing that we did is, we avoided a 17% drop in the market during that period that we were out. And you know, that’s very disconcerting if you have a drop like this 17%. That’s scary is all get out. And you know, we avoided it. And hopefully you had the peace of mind when that was the case, because we were out of our equities while this was happening. And so hopefully you you didn’t lose any sleep during that period, because there was no, there was no risk for you with regard to the stock market at that time. So the next thing we did was that during the big correction that we got here in July through October, we stayed in for the run up. Okay, so this is what happened during that correction, this is from July through the end of October, from the end of July to the end of October. So you can see here, it was a correction, it was a 10% drop in the stock market during that period. And of course, that was disconcerting for us because we were in and it was kind of scary, of course. And in fact, we actually got within 2% of our sell signal. So we were very close to actually getting out. But we remained disciplined. We trusted our strategy. And we did not sell we didn’t panic. And that helped us to stay in for the run up that followed. And you can see that it was a significant run up. Now you’ll notice that in these charts, all these charts go through December 18th. The reason why is because we produce this, this video ahead of the end of the year, obviously, with the holidays and everything else, we wanted to get this out to you before that. And so these these charts are not all the way to the end of the year, as you can see, but be that as it may, a significant run up followed that we were able to participate in after the correction because we stuck to our guns and to our strategy. The other The next thing that we did this year for you is as you may know, we rebalance your portfolio on a quarterly basis, right so at the end of every quarter, in that first in those first few trading days of the new quarter, we rebalance your portfolio so that way we keep you if you’re a 60/40 client we keep you In that 60/40 allocation, we don’t want to get all out of whack. And so what you can see is that when the market came all the way down here at the beginning of October, you can see that it was it was down quite significantly. And when we rebalanced because the market had come down so much, our equity portfolio had lost money. And therefore we weren’t 60/40 anymore, we had less than 60 in our stocks, and therefore more than 40 in our money market fund. So when we rebalanced we took money out of the money market fund, and bought more stocks here in the early part of October. And what you can see is at that point, the market was down a little over 7%. And by the time it got to the to our period here, that was almost 11% rise. So not only did we stay in during the correction, we bought more when we rebalanced and that was we think a very good thing to have happen. The next thing, of course, is when it comes to our bond portfolio, we’ve been talking about that with you pretty much all year. And we stayed out of bonds all the way until just recently here in December of 2023. And so about a year and eight months, we were we’ve been out of bonds. And of course, that’s during the worst bear market in bonds, according to Bloomberg, since we’ve been recording bond market performance. And this, we’ve chronicled this for you all as it was happening. And of course, you know, that was a very scary situation. And we’re happy we were not in it during that time. But now as you guys know, we think it’s time to get back in, we think the opportunity for bonds have significantly improved. And in fact, if you watch our video regarding why we’re buying back into bonds, you’ll see that we think that 2024 will bring with it some very nice gains in bonds. So we wanted to be in that. And therefore that’s why we bought back our bonds. So basically, that’s 2023, in review your Investment Oversight Committee in action, doing it for you, and getting all the gray hairs and the worry so that you don’t have to and you can go out there and SCWPer and your little, your little what do I say your fanny off, we want you I’ll say it, we want you to SCWPer your fanny off. So that was 2023 In Review. Now we have a core value number four, which says that if a client calls us about something that we should have told them that we lost. And so that’s why we have these videos, in fact, now in January, you’re going to be getting what is called our ADV. Don’t ask me what that stands for. But it’s called the ADV. The ADV is that packet you get in the mail its 1000 pages, you probably never read it, it’s got all our all the stuff about us in it. But there’s a couple of things in there that are important that we want to tell you about. The first one is that we are going to be raising our fees for clients who are under 250,000 that have less than 250,000 with us dollars with us by seven tenths of 1%. Now, I just came back from a conference that I attended with 21 that it was it was a top 22 CEOs of advisory firms in the country. Apparently I was one of them. And so it was very interesting, because there was a session on how do we get rid of clients who are under $250,000. They’re not profitable. So how do we get rid of them? What have you guys done? And one of the CEOs said, Well, we just told them to leave, we send them an email, and we said, you need to just leave. And if you don’t, we’re basically going to stop servicing you and not return your calls. And I thought, Wow, that’s pretty intense. So that’s not us. So if you are a client that is under the $250,000 threshold, we love you, we are loyal to you, you’ve been loyal to us. We don’t want you going anywhere we want you to be with us for the rest of your life. We want to advise you all through your journey be retirement planners. And so we want to make sure that we’re fair to you, we’re fair to ourselves. And so we’re going to also be enacting a digital service model that will enhance what we’re doing currently with you. And that way we can save some cost and continue to have the relationship with you that we want. So our goal is to find a way in every possible way to keep you we love you, we want you to stay we don’t want you to go we’re not trying to get rid of you. But again, we have to be fair to both of us. So the other thing that we’re gonna see you’re gonna see in the ADV is that we have changed our we’re going to change our ownership structure. Okay, and so we have new owners now you may freak out about that, but don’t I’m not retiring, we’re not changing anything, the company is not being sold to some outsider, we’re not doing any of that. Basically, it’s my decision to have us become a an employee owned company. So the our employees are going to own a portion of the company. I wanted them to be rewarded for all the hard work that has gotten us to where we are now. But also, I want them to participate in the future success that hopefully we will have as owners, so they’ll have a stake in the outcome. I think it’s going to be a good thing for them. It’ll be a good thing for the company, and it’s the right thing to do in my view. So again, we’re not changing anything. In fact, if I hadn’t told you, you wouldn’t even have noticed that but it’s in the ADV you’ll see it and I don’t want you to freak out about it. So really long video, lots of information. Thank you for watching and we will talk soon.
Please note: transcript has been modified after the time of recording.
Economic indicators and stock market performance cannot be predicted. Opinions expressed regarding the economy and the stock market belong solely to Ken Moraif on behalf of Retirement Planners of America and may not accurately portray actual future performance of the economy or stock market outcomes. Opinions expressed in this video is intended to be for informational purposes only and is not intended to be used as investment advice for individuals who are not clients of Retirement Planners of America. All content provided is the opinion of Ken Moraif, CEO and Founder of MMWKM Advisors LLC (d/b/a Retirement Planners of America). ©Copyright 2023