We believe in long-term investing. We subscribe to the Modern Portfolio Theory and effective diversification across dissimilar asset classes. We invest in a wide variety of asset classes with the goal of capturing the return on capital that inevitably global capital markets produce.
We're located in beautiful Historic Downtown Chestertown
Move your "Someday" closer with our IRA's.
May 1, 2022
Welcome to May—we bid a not-so-fond farewell to the first third of 2022. In my mind, everything before summer is a prelude. And while we have another 51 days of spring, the weather turns remarkably better in May. In the markets, not so much. From 1950 to 2021, May is the fifth-worst month for returns, averaging just 0.17% gain, with 43 up years and 29 down. (February, June, August, and September are worse, with September being historically the worst month of the year with an average loss of 0.69%[i])
Perhaps you have noticed, we rebalance our portfolios in February, May, August, and November. Rebalancing means we take any cash built up from dividends, contributions, or distributions and invest that cash into positions that have underperformed the rest of the portfolio. We want to bring the laggards back into the established allocation percentages. Read More
April 1, 2022
What a long, strange trip it’s been[i]. Two years ago, we were learning more about a Corona Virus—and it had nothing to do with Corona Beer. My boating friends and I celebrated St. Paddy’s day 2020 in some very crowded bars in downtown Annapolis—and two weeks later, we sat in a circle on a Kent Island dock separated by at least 10 feet so that we would miss the “rona.”
We’ve gone through two years of the ebbs and floes of Covid, new variants, new waves, new restrictions, and new regulations. Then the 2020 Presidential Election—turned into a bitterly partisan and contentious event that still separates many families and friends. COVID, and the politics of the election, sparked a 40-year high inflation spike—with, I think, at least another 12 months of that on the horizon. And of course, this last month, we see the brutal Russian/Ukrainian war—which will only fan the inflation fire. And as icing on the cake, add multiple violent protests throughout our country, and we have had, to put it mildly, a very eventful start to the 2020 decade. Read More
As we turn the page from February to March, we can breathe a little easier about the passing of another winter. March has one foot in winter and one in spring, and here in Maryland, we have had some of our worst blizzards in March. So it’s not over yet—but close. (The official first day of Spring is Sunday, March 20.)
March also brings us one month closer to the income tax deadline. So a couple of things—if you’re going to make that last-minute IRA contribution for 2021, you need to get that check to us before you submit your IRS forms. Same with a 2021 Roth contribution. Roth IRAs do not save any current income tax, but they never generate a tax bill in the future—for you or your heirs. Read More
Here in Maryland, Winter has settled into an uncomfortable cold, windy, and wet weather pattern. Some mornings it is a chore just to get out of bed. Who wants to get up when it is 14 degrees, and the heat pump feels like an air conditioner?
I recently read a strange little book written about 1,800 years ago by Marcus Aurelius—Emporer of the Roman Empire from 161 to 180 AD. The book is titled, Meditations[i], and it basically sat on a shelf for over 1,000 years before people started paying attention to it (sometime around the 13th century.) In the 21rst century, Meditations is considered one of the world’s top 100 books ever written. That’s strange since Marcus Aurelius did not wish for it to be published, and in fact, he left instructions for it to be destroyed upon his death. It is not a page-turner for sure—but it is a life-changer. Read More
Things We Want to do before the End of the Year
Thanksgiving arrives in a week and marks the official start of the holiday season. As a percentage, Thanksgiving Day means we are 90% through 2021. Let’s think about things we can do with the remaining 36 days of 2021 to ensure we don’t miss something. Read More
Corrections are Buying Opportunities
Since 1980, the S&P 500 has registered at least one significant drop in value every year. During those four decades, the average drop per year is 14.3%. Let me highlight that: every year since 1980, the S&P 500 has had an intra-year decrease in value on average of 14.3%. This drop is frequently referred to as a Correction[i]. Corrections are no fun. They keep people up at night worrying about their investments. What in the heck is going on this time? Is this time different? My Certificates of Deposits do not correct. My savings accounts do not correct. My mortgage does not correct. Why is it that my portfolio has corrections? Read More
Bubble, bubble, bubble! Tune in the news and particularly the financial news, and this is all we hear—bubble-talk! The teaser (just before a quick word from their sponsor) is something like this, “Some financial experts think the market is approaching bubble territory.” Then, after 20 minutes of commercials, the expert, who is usually the same expert who has been predicting doom-and-gloom since the 1950s, says they are “concerned” and they think, no urge, investors to “use caution” or “tread lightly.” On February 25, one station even trotted out perma-bear Nouriel Roubini. A sure sign of desperation for bad news is Mr. Roubini. Read More
Just 48 days till Spring, and it can’t arrive a day too early. And while I look forward to Spring and some warmer weather, there’s always another day shortly after March 20 that dampens my mood—April 15, tax day! These next 74 days get a little busy around here as we try to get out the 1099’s and get in the final IRA payments. We actually like to be active, so that part is not too bad. It is the call from our CPA that I dread. Don’t get me wrong; I usually have a good idea whether it is going to be good or bad—it’s almost always bad news. But it is the degree of badness that causes my heartburn. Here are a few points about this time of year. Read More
