“A goal without a plan is just a wish,” wrote French author Antoine de Saint-Exupéry in the 1942 classic, “The Little Prince.” In financial services, we like to say, “Investing without a strategy is just a dream.” At its core, an investing strategy is designed to help you 1) track progress toward your goal, 2) define your risk tolerance, 3) set your time horizon, and, perhaps most importantly, 4) help define and measure your success. The chart below shows my fears about what happens when people invest without a clear, well-defined strategy. In 2024, individual investors again lagged the S&P 500. We all know why–fear, greed, and overconfidence can cloud judgment and lead to poor decision-making and bad returns. |
When we created your strategy, we were clear about where you were and where you wanted to go. So, each year, we can measure your progress toward your goals. But life happens, and sometimes goals change. If you see any changes on the horizon for 2025, please let me know as soon as possible. We might need to revisit your approach. Ultimately, we want your investment strategy to help you realize your dreams—all of them. |
JP Morgan, 2024. As reported by The Kobeissi Letter. |
This material was developed and produced by FMG Suite to provide information on a topic that may be of interest. FMG Suite is not affiliated with the named broker-dealer, state- or SEC-registered investment advisory firm.
The S&P 500 Composite Index is an unmanaged index that is considered representative of the overall U.S. stock market. Index performance is not indicative of the past performance of a particular investment. Past performance does not guarantee future results. Individuals cannot invest directly in an index. The return and principal value of stock prices will fluctuate as market conditions change. And shares, when sold, may be worth more or less than their original cost.