Jan. 2020 – New Year’s Resolutions

The past two years serve as a stark reminder that markets are fickle,and of how easy it can be to fall victim to fear. As 2018 closed global equity markets were down nearly 9 percent for the year. Global economic growth appeared to be slowing, trade wars seemed imminent, and interest rates were low, even negative in some countries. The news offered little reason for optimism. Yet as we describe in the following pages, 2019 was a year of exceptionally strong returns across asset classes worldwide.

We suspect investors who did not panic and adhered to our guidance were pleased. So we once again offer these timeless resolutions:

• I will remind myself that investing is not a form of entertainment — if I have an urge to gamble, I will go to Las Vegas.

• I will stick to my plan.

• I will not attempt to pick winning stocks.

• I will ignore market prognosticators.

• I will ensure that my holdings are adequately diversified within each asset class I own.

• I will focus on controlling my investment-related costs.

• I will stay abreast of changes in investment-related tax laws.

• I will not purchase any financial instrument I do not understand.

• I will ignore money managers or others selling products rather than advice.

• I will take full advantage of my qualified retirement plans by making the maximum allowable contributions consistent with my budget.

• I will hold my least tax-efficient assets in my tax-deferred accounts.

• I will re-balance my portfolio infrequently, but at regular intervals regardless of the current state of the markets.

• I will not allow the price I have paid for a security to influence my future investment decisions—except for tax considerations regarding capital gains and losses.

• At year end I will harvest tax losses simply, without deviating from my target portfolio allocations, by selling and buying index-type funds within the same asset class.

• I will appreciate the simplicity of the AIS approach; instead of worrying about factors that are not within my control, I will establish my plan and turn my attention to enjoying life.

Also In This Issue:
Quarterly Review of Capital Markets
The Secure Act: Implications for Investors and Employers
Annuities in your 401(K)? Think Twice 
The High-Yield Dow Investment Strategy
Recent Market Statistics
The Dow-Jones Indus trials Ranked by Yield
Recommended Investment Vehicles

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