Future Bright

Using Data to Position Assets Favorably!

Q1 2021 Commentary…
2020 was a year full of alarming statistics. One you maybe didn’t hear was that over 10 million new brokerage accounts were opened by first-time investors in just the United States alone! This influx was the result of three things: stimulus checks, a pandemic-induced market selloff, and the elimination of trading commissions at brokerage firms such as Schwab, TD Ameritrade, and Robinhood.

2020 created a perfect storm to attract more individuals to invest, which is a great thing for market efficiency and liquidity. The dangerous part of this perfect storm is that many younger, new investors have not yet experienced a significant market crash, as most of this new money came into the stock market during its recovery. Significant gains were created by and for investors who were willing to take on the risk of buying assets some maybe didn’t even fully understand. New money was piling into SPACs, Bitcoin, LIDAR stocks, to name a few. (If these terms don’t ring a bell, it’s okay. We got you covered.)

In client accounts that could afford to take the risk, we benefited from the irrational exuberance of many of these first-time investors. In fact, we rode some of the waves they created. However, we know the tide can go out just as fast as it comes in, and as asset managers, we have to have a game plan in place for when markets aren’t turning up all roses. Discipline is often what marks the difference between casual, DIY investors and those of us who do this for a living in times like these.

If 2020 taught us anything at Future Bright, it’s that we have to pay attention to the raw economic data more than ever before. We’re not talking COVID numbers. We’re talking economic numbers. Specifically – GDP and Inflation – which are the two most telling indicators of what lies ahead for financial markets.

Currently, we’re in a “GDP up, Inflation up” environment. Certain investments work better than others under these economic directional conditions, and it’s our job to find them for you. It’s also critical to recognize these economic directional conditions will periodically shift. That’s just how economies ebb and flow. They endure four cycles: Prosperity, Reflation, Stagflation, and Deflation. If we know the current economic directional condition and can also see when that condition is changing, we can use data to position assets favorably under any condition.

Ironically, asset management in 2021 will be much more challenging than it was in 2020. We expect to see greater market volatility this year. (Honestly, we thought volatility would come in Q4 of 2020, but it never did.) Nonetheless, it is also a very exciting time to be an investor. The public policy response driven by COVID has actually accelerated many new market opportunities in technology, energy, healthcare, e-commerce, and other industries. As always, there will be winners and losers in the markets, but there are some great opportunities for wealth creation ahead borne out of both volatility and emerging investment opportunities.

Future BrightUsing Data to Position Assets Favorably!
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Goodbye to “2020”

Phew! We soon will be able to put 2020 behind us. The financial markets have been just as abnormal as most other facets of our lives this year. All the relevant U.S. stock indices endured the fastest bear market declines in history…just 16 days! It was swift and severe, yet short-lived, as the markets repaired most of the damage in the form of a V-shape pattern despite most Wall Street “experts” predicting an L-shaped recovery.

Future BrightGoodbye to “2020”
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Recovery

Hello friends, Social distancing affords a person a lot of time to reflect on life, doesn’t it? This time spent at home with family has been a great blessing. Life’s pace has slowed down, and that’s the solace I didn’t know I needed. I hope you’ve found your own moments of solace amidst this abnormal reality, as well.

Ross AlmlieRecovery
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“Landlines” Have Gone Away for Us!

No more landlines for us! We have eliminated our landline phones at the Future Bright office. They were used too sparingly to justify paying for them anymore. As such, the (218) 359-2305 number no longer exists. Most of you have my cell number, but in case you do not, please write this number down or add it into your contacts: Ross Almlie Cell 701-306-7631
Feel free to contact me by text or phone call at this number. If I don’t answer when you call, please know that I will make best efforts to return your call or text as soon as I can.

Ross Almlie“Landlines” Have Gone Away for Us!
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Individual Stocks – Are they for you?

2020 Q1 COMMENTARY:
Contrary to what logic might suggest, the most difficult time to be an investor is when the financial markets are in the late stages of a multi-year upward trend. As we witness market levels hit record highs, the appetite for adding new money to investments can start to wane for fear that the most opportune time to buy has already passed us by. It’s an innate thought process. Since we were little, we’ve all been taught that too much of a good thing is not always a good thing, and it’s a legitimate lesson that I’m sure we’ve all learned multiple times in our lives.

Ross AlmlieIndividual Stocks – Are they for you?
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“Race to Zero” is over!

Just a few items to share with you as we dig into this 4th quarter…

The “Race to Zero” is over. Commissions at TD Ameritrade have always been very low relative to its competitors in the industry. I’m happy to report they have now been reduced to $0.00 on all TD Ameritrade stock and ETF trades effective immediately! This is beneficial to everyone, but it is particularly beneficial to those adding regular contributions incrementally to fund Roth IRAs, Traditional IRA’s, SIMPLE IRA’s and SEP IRA’s. The race to zero is over, and investors win!

We’ve added to our team! I’m pleased to notify you that we’ve added two more investment advisors – Matt Johnson and Randall Sidener – to our Future Bright advisory team. Both are longtime friends of mine. Matt joined the firm earlier this year and brings over fourteen years of industry advisory experience along with him. He’ll continue to operate out of Detroit Lakes. Randall will join be joining in mid-October. He is an industry veteran in the mutual fund wholesaling business, having spent the last thirteen years with Integrity Viking Funds out of Minot. Randall will be joining me at our office in Moorhead.

Ross Almlie“Race to Zero” is over!
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