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We Are Invested. So What Happened?

  • This week is a debrief — we reached our invest signal and got reinvested earlier this week.
  • Now the question is: what happened between going into protection mode and getting back in?
  • Everything we do is grounded in our investment principles.
  • Investment principle number one: we are committed to having your money last as long as you do.
  • That means our goal is not to make the most money possible.
  • If it were, we’d take extreme risks — but that’s not what retirement planning is about.
  • Investment principle number two: growth is important, but protection against catastrophic losses is even more important.
  • That’s why we acted when we hit our protect signal.
  • At that point, we used our sanity checks to determine how much to protect.
  • Two of the four sanity checks were flashing red.
  • Based on that, we protected 50% of your equity portfolio.
  • Those signals were flashing red before the Iran conflict escalated.
  • The war made things worse, but it was not the root cause.
  • Our research shows that when two sanity checks are red, markets have historically declined 25–30% on average.
  • That’s why we took action — to protect you from that potential downside.
  • Another key principle is opportunity cost.
  • Opportunity cost means we may miss some gains by protecting early.
  • That is expected — it is not a mistake.
  • Think of it like insurance.
  • When we go into protection mode, we are acting like an insurance company, protecting your portfolio from large losses.
  • The “premium” for that insurance is the opportunity cost.
  • From the time we went into protection mode to when we reinvested, the market rose about 9.45%.
  • Because we only protected 50%, the impact was reduced.
  • For a fully invested stock portfolio, that equates to about 4.73% of opportunity cost.
  • For a typical 60/40 portfolio, that equates to roughly 2.8%.
  • No, we don’t want to miss that gain — but it is manageable.
  • Compare that to a major bear market, where losses can be 50% or more.
  • If you lose 50%, you need a 100% gain just to get back to even.
  • Recovering from a small opportunity cost is far easier than recovering from a large loss.
  • That is the trade-off we are making intentionally.
  • This is step seven of our process — the debrief.
  • We always review what happened so you understand the results and the reasoning.
  • Another important principle: paying taxes on gains is preferable to losing principal.
  • In taxable accounts, some of the protective moves may create tax liabilities.
  • But those taxes are far less damaging than participating in large market losses.
  • Our entire approach is designed around protecting your ability to stay retired.
  • We want you to recover quickly from downturns, not spend years digging out of losses.
  • If you have questions, we encourage you to reach out to your retirement planner.
  • We are here to walk through all of this with you in detail.
  • Our goal is to give you peace of mind while we manage the markets for you.
  • So you can focus on enjoying your Second Childhood Without Parental Supervision.

Transcript:

Ken Moraif
Hello everyone, and welcome to our weekly market alert video for today, which is April 17, 2026 and we have a ton to talk to you about. And I hope this video finds you healthy, wealthy and wise. I hope all you skippers out there are out there enjoying your second childhood without parental supervision, letting us worry about all this financial stuff for you, and for those of you who are not yet retired, who are not yet skippers, then we’re going to do everything we can to get you there. In this episode, I want to go over with you. Basically, we found our we reached our invest signal on Monday, and so they’re on Friday rather. And so we got reinvested on Monday. And so what happened since then? And where are we? So basically, this is going to be a debrief of everything that’s happened this week, so that you are aware. Okay, so the first thing I want to do is I want to talk with you about our investment principles, because everything we do is grounded in our investment principles. So these principles were created years ago. And the thing about principles, the reason why you have them, is so that when you are in the heat of battle, when you know all heck is breaking loose, and the markets are going nuts and all that, you’ve already thought through what you’re going to do given those circumstances. You’ve already understood what needs to happen, and that way, you can be level headed and clear in what you need to get done. So what I want to go over with you is our investment principle number one, first, and that is that ARPOA us, we are committed to having your money last as long as you do. Okay, so think about that for just a moment, because if that is what our goal is, then our goal is not to make the most money possible. Okay, as I’ve said many times in the past in our seminars, if our goal was to make the most money possible, then here’s what I recommend everybody does? Everybody cash in every account that you’ve got, get all that money, put it in a suitcase, and we’ll meet out here in front on Monday. We’ll all get in a Greyhound bus. We’ll go down to Las Vegas, and we’ll bet it all on black. All right, so now, if we hit, we’re going to be one rich group of people. But of course, if we miss, if it’s red, then we’re going to be one poor group of people. So that’s one extreme. So if the goal is to make the most money possible, then we could take a lot more risk than we do. But it’s not. It’s to make sure, to the extent that we can, that your money lasts as long as you do. Okay? So that get that creates a different paradigm, a different way of looking at things. So investment principle number two says that growth is important, but protection against catastrophic losses is even more important. Okay, so that’s why, when we reach our protect signal, when it says that potentially bad things are coming, we understand it is more important to protect you from catastrophic losses than to worry about, you know, we’re going to miss out on gains. Okay? So if that is the case, then once again, that’s why we have all these things that we do to protect you from that severe downside. You guys, if you’ve watched the stuff we’ve sent you, you know that we look to once we hit that signal, we look to our sanity checks to determine how much should we protect you. Right? Does it need to be 100% 50% 25% and that all depends on whether we think this is going to be a big, bad bear market or not. So if all four of the sanity checks are flashing red, then most likely, we are going to protect 100% of your stock portfolio, of the portion of your investments that are in stocks. Now, if we don’t, then it’s going to be less so in this case, two were flashing red, therefore we protected 50% of your equity portfolio. So if you’re a 60 stock 40 bond client, then 60% of your money of that of that 60% half was ta was protected, and the other half remained okay. So basically, when two of our sanity checks are flashing red, our

Ken Moraif
research has told us that what comes next, on average, is a 25 to 30% drop in the market. So given that, we had to take evasive action, and that’s our job. Now, the two flashing red were flashing red before the war in Iran even started. Okay? So you may think, Well, you know, the war did that, and the war is going to go away, and therefore, no, they were flashing red before the war started. So the only thing the war did was make everything worse, you know, not better. So just so you know that number five investment principle, which is very important, is that our invest and protect process comes with what’s called opportun. Cost. So opportunity cost means that you missed out on gains that you could have had, right? So opportunity cost, there was an opportunity there, but you didn’t get it. So that’s the cost. So if the market does not go into a big, bad bear, if it’s a shallow or short bear market, or a garden variety bear market, where it goes down maybe 25 or 30% but then it rebounds quickly. Then in those cases, more often than not, where we invest is going, where we invest is going to be at a higher point than where we protect it. That difference is called opportunity cost. We missed out on what we could have made because we did this. Now, the way I look at that, you know, and just so you understand, the reason why that is an investment principle is because we know this. Okay, this is not a surprise. It’s not a mistake. We understand it. It’s a known thing. So how do we look at that? How do you put that in your head and say, Okay, why does that even make sense? Well, think about your home, and you buy fire insurance for your house. Are you looking to make money by buying fire insurance on your house? Is that a thing you’re going to make money on? The answer is, of course, not. In fact, there’s a cost to it. You got to pay a premium. Well, our invest and protect process, especially the Protect part, I consider it that we have now gone we’ve become an insurance company. We’re not an investment company anymore. We are now protecting you from potentially catastrophic losses. That’s what we want to do. So now we’ve become an insurance company, and just like the insurance company that sells you your car insurance or whatever, the goal is not to make money, the goal is to protect you from losing mass quantities. That’s the goal, and it comes with a premium, and the premium is the opportunity cost. Okay, so let’s talk about what happened from when we went into protection mode to where we went back in in investment mode. What was the difference and what was that opportunity cost? So the first thing I want to tell you is that the s and p5 100 index the stock market, from when we went into protection mode to where we got back to investment, there was a difference in the market of 9.4 or 5% in other words, the market, the s and p5 100 index, went up from one point to the next by 9.45% now keep in mind that, because we only protected 50% we just said, based on our sanity checks, we don’t need to buy 100% insurance, but we do need to buy some and we need to buy maybe 50% and so that’s what we did. So therefore, of that 9.45 the opportunity cost, if you were 100% in stocks with us, then that would represent 4.73% opportunity cost. But I can say that the vast majority, in fact, maybe all of you that are watching this are not 100% in the stock market. So if you are a 6040 client, then for you, it’s 60% of that 4.73% okay, which means about 2.8% so if you’re a 6040 client, then the opportunity cost. What you missed out on was approximately 2.8% so do we want that? No, we don’t. But think of it this way, in a big, bad bear market like 2000 like 2008 those markets took years to get back. If you lose half your money, you have to make 100% to get back to even think about it. If you have, if you have $100 and you lose half of it, that’s $50 for it to get back to the 100 you have to make 100% if you make 50% then you only made $25 you add that to your 50 and now you have 75 you’re not back to even. So if you lose 50% you have to make 100% to get back to even. That’s a tall order.

Ken Moraif
2.8% is really easy to get back. In fact, you know, if the market goes up some more, we’ll get it back on in short order. So again, the way we look at it is we want to be able to recover quickly from bear markets. We want to protect you from big, bad bear markets, and it comes with opportunity cost, and we call that the premium for the insurance we bought to protect you. Okay, so that’s how I would like for you to think about it, because that’s the way we do and hopefully we are aligned on all of that. So a lot of stuff in this one, a lot of math. I’m amazed I kept track of all of that, and I didn’t get confused in the middle of it all. But that’s that’s essentially what happened. This is the debrief part of our invest and protect process. It’s step number seven, which we are. Always going to go over what happened, what did we? Did we gain or loss? Now, one other investment principle I want to go over with you, and that is that paying taxes on gains is preferable to losing principle. Okay, so, paying taxes on gains is preferable to losing principle. Okay, so for your non IRA money, when we protected and we got out with 50% of your stock portfolio, if there were gains there, then there would be tax on that. That tax is less than if it went down 50% and you participated in that. So again, that’s the opportunity cost. That’s the cost of protecting you. Okay, so that paradigm shift, which is we’re committed to having your money last as long as you do, is why we do all this and paying taxes. Nobody wants that. I don’t want that, but it’s better than losing mass quantities. Okay, so I hope I’ve kind of gone over everything with you. If you do have questions about anything we’ve talked about here, make sure you get in touch with our with your retirement planner. They would be happy to spend the time with you, explaining everything to you in great detail, answering your questions about the sanity checks. And then also, just want to say that we had our two town halls this this week. We had a lot, hundreds of people attend. That was great. It was wonderful. But we also had a lot of you that did not attend. So what we did record them, we’re going to kind of put them together and do a best of and then we’re going to send that out so that those of you who did attend who want a refresher, or those of you who did not attend can watch it for the first time. Okay, so we’ll watch your mailbox for that. So again, I hope this video finds you healthy, wealthy and wise. I hope that you are enjoying time in your retirement, letting us get the gray hair for you so that you don’t have to and again, from the bottom of our heart, thank you for being our client, for being our squipper. We are honored. We are privileged. Without you, we’ve got nothing, and we know that, so we’ll 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 employees of RPOA 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 employees of RPOA Advisors, Inc. (d/b/a Retirement Planners of America ) (“Retirement Planners of America”, “RPOA”). ©Copyright 2026