“Americans are devoted to the pursuit of happiness. Unfortunately, research shows that many of us don’t actually know what makes us happy, so we end up pursuing the wrong things,” writes Dr. Shlomo Benartzi, professor and co-head of the behavioral decision-making group at UCLA Anderson School of Management. One way to help your happiness is […]
“Meltdown? Absolutely baked into the cake as I write to you, and becoming more of a deep midterm concern for me as time passes,” wrote Dick Young in Intelligence Report back in July 2015. And here we are a short way into 2016 and the speculative NASDAQ index is down over 8%. As Dick notes, “In recent issues, my goal has been to work especially hard at providing you intelligence that will keep you safe and dividend-centric during what I consider the inevitable coming meltdown.”
Safe and dividend-centric—sort of has a ring to it, does it not? It does to me. Those words have been pounded into my head for all the years I’ve worked with my father-in-law, Dick Young, founder, and with my brother-in-law Matt Young, president and CEO of Richard C. Young & Co., Ltd. In addition to our family bond, the three of us studied, at different times, at our shared alma mater, Babson College. But it was Dick who studied charts (much to the dismay of his teachers, I’m guessing) as a student at Shaker Heights High School. As you can see, there’s a lot of history when Dick writes, “I have tweaked my original work on dividends and interest, along with my long-time interest in gold (I have held my original 1982 China Gold Pandas for decades) to produce what I call the ‘Maximizers’.”
The Maximizers is a diversified portfolio, a “Retirement Ark,” if you will, of dividend-paying and dividend-increasing (for 10-consecutive years or more) common stocks, high-grade bonds, and gold. A simple enough sounding strategy for sure, but a strategy that is difficult to follow, especially in times like these when legendary investor Jack Bogle would likely advise the twitching masses to “just don’t do something, stand there.”
And stand there should you, as Yoda might say. Because it is my belief that you might lose a couple battles here and there with a Maximizers styled approach, but you will win the war. An inside baseball look reveals that the speculative NASDAQ beat the Maximizers in 8 of 15 years this century, versus 7 outperformers for the Maximizers. A pitcher with a 7-and-8 Major League Baseball starting record would be banished to the bullpen. But despite a 7 and 8 record, the final results have been incredible over the complete 21st Century.
The Maximizers win by a long shot. At the same time, the Maximizers offer you the peace of mind and comfort you deserve. The maximum deviation between the best and worst year for the Maximizers is a tiny 10 percentage points. For the outgunned and outmanned NASDAQ, the deviation is an unsettling, if not breathtaking, 91 percentage points. And the bone-chilling NASDAQ record includes five down years, four of which were bruisers. No half-sensible retirement investor is going to sign on for that backbreaking volatility. Never forget Dick Young’s cardinal rule of portfolio crafting: Always analyze risk before worrying about potential returns.
How quickly things can change. Back in April I wrote to you of Sweden’s all out dash toward creating the world’s first cashless society. Digital currency was the wave of the future, and the Swedes were happy to lead. Now, though, the movement toward a cashless society in Sweden is being challenged. Swedish politicians are […]
When arriving in France and immediately driving away from Charles de Gaulle airport, it’s hard to miss all the warehouses/distribution facilities on your way to Paris. I found this article interesting as companies battle for logistics superiority by building in more affordable Eastern and Central Europe. The WSJ’s Isobel Lee explains: The industrial real-estate market […]
You don’t want to be in the prediction business, period, especially when it comes to your hard-earned money. In the last week, by example, my favored GNMA fund (managed by Wellington), surged by over one percent. In a week! That’s a big move when the annual yield is around three percent. Markets are funny. The […]
You simply cannot afford to take heavy losses in or near retirement. From a financial standpoint the arithmetic of losses is devastating—lose half your portfolio and you need a 100% gain (not likely) to get back to even. Now, a study has been done to show the impact of losing money on one’s health. And […]
Where will you live in retirement? Having recently been to New York City it’s a wonderful place to visit, but nowhere I’d like to spend most of my time. Plus, who can afford it? Check out the quote at the end of this piece. But first… Imagine retiring in 1999 and dreaming about the trips […]
Originally posted September 23, 2016. Read the entire Your Retirement Life series by clicking here. You’re about to read the second installment of my brand new series, Your Retirement Life. We are in this together, trying to live a more prosperous, fulfilling life. It ain’t easy. But we can learn from one another. I’d like to hear […]
Personally, I have had only one minor administrative error recently with Vanguard where they incorrectly deposited SEP-IRA money into my traditional IRA. I called them to explain their error, they pulled up the letter of instruction, recognized their mistake and made the correction. Problem solved. With record inflows of more than $1 billion per day […]
In my five decades of investing experience, a piece written yesterday by Jeremy Jones, Chief Investment Officer at Richard C. Young & Co., Ltd., is the best I have read. The piece begins: The Dynamic MaximizersSM Portfolio has gotten off to a slow start this year. The Maxis Portfolio is down about 2.4% YTD. That still edges out […]
Well this was a fun month for the stock market with wild swings from high to low of around 2,000 points in the Dow Jones Industrial Average. One question I’m asked on a consistent basis is “E.J., is your phone ringing off the hook?” and my answer is “no,” and I know why. Most of […]