Off Wall Street But Not Off Track

Meyer Capital Management, LLC, welcomed me as a new-hire investment professional in June 2018. I arrived with 138 credit hours, two majors, and three prior internships as part of four wonderful years at the University of Dayton. During this time, I leveraged UD’s experiential learning philosophy to its fullest advantage. I traveled twice to New York City presentations and forums, learned basic technical analysis from a seasoned commodity trader, and worked as a health care analyst for the student-run 30-million-dollar Dayton Flyer Fund. Co-managing the Fund and contributing to its growth inspired me to pursue professional portfolio management which led me, fortunately, to MCM.

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Ode to Anderson

Forbes Magazine’s 2016 list of Best Cities for Young Professionals ranks Cincinnati a very respectable #15 in the nation, even among hot-spot regions like San Francisco, Silicon Valley and Denver. As a young professional, this is exciting confirmation of what I already knew. But as Cincinnatian’s know, each neighborhood here is its own organism and some areas are more attractive to young professionals than others.

When I was nearing graduation from Xavier University, many of my peers were clamoring for job offers in the popular and trendy Over-The-Rhine (OTR) neighborhood. OTR is charming with lots of character and is within easy walking distance of a multitude of unique restaurants, clubs, and bars that draw crowds of young professionals at lunchtime and after work. Other XU grads opted for jobs in the central business district at one of Cincinnati’s 10 Fortune 500 companies. I was an outlier (I prefer to think trendsetter) when I accepted a position in the suburbs, namely Anderson Township.

My decision to work in Anderson proved to be an excellent choice. On the surface, there are obvious positive attributes — beautiful parks, close proximity to highways, and a pleasing mix of city and rural life, to name a few. Once I started working here, though, I learned Anderson has even more to offer those who dig below the surface.

anderson-township

 

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Limited Time Opportunity for NEW MCM Clients

For a limited only, new MCM clients who qualify are eligible for one full-year of free equity and ETF trade commissions, making now a great time to refer someone you know!

Personal referrals are MCM’s primary source of new business growth. We are actively seeking to grow so that we can bring more of MCM’s great benefits and services to more people. We are very thankful for each referral we receive and for all of our existing clients who joined the MCM family via referral. If you appreciate someone who shared MCM with you, it’s likely someone you know will also appreciate the gesture. So…share the wealth, figuratively of course, by referring someone you know. They’ll be grateful, and we will too.

Why High Earners Still Live Paycheck-to-Paycheck

If you live in the United States and have yearly family income of $150,000 or more, a recent study by Nielsen Global Consumer Insights reveals that there is a 25% chance that you have little or no savings because you consume every last dollar you earn.  This is called living hand-to-mouth or, to put it bluntly, you’re basically broke.  Isn’t that hard to believe?

The average family income in the U.S. is just under $47,000 as of 2014.  It would be reasonable to think those fortunate souls making over $150,000 would not be struggling each month to make ends meet.  Not so, according to Nielsen.  Far from it, in fact.  The same study revealed 33% of households making between $50,000-$100,000 and 50% of households making less than $50,000 are in the same hand-to-mouth situation.

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4% Rule: Made to Be Broken?

A common concern among investors is running out of money in retirement. Combating this concern, the “4% rule” is widely presented as a simple way to help your money last. Created in 1994 by financial planner William Bengen, the 4% rule says if you withdraw 4% of your nest egg each year, adjusted annually for inflation, there is a 90% chance your money will last at least 30 years. Yet despite its notoriety, the 4% rule is not without issue.

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MCM’s Backbone: Administration

“I’m a Portfolio Administrator at a registered investment advisory firm, Meyer Capital Management.”

“So… you’re a secretary?”

“No, actually. I’m not a secretary.”

There is a stereotype, across various industries, that all administrative professionals are secretaries. This attitude isn’t always fair for individuals, such as myself, whose titles encompass the word “administrator,” since we are much more than secretaries. So what gave the title such a bad reputation?

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Global Markets Shocked by Britain’s Surprise Decision to Leave the European Union

 Polling ahead of yesterday’s Brexit referendum in the U.K. pointed to a slim victory for Remain proponents, including Prime Minister David Cameron. As a result, stocks gained steadily in the days leading up to the historic vote. How misleading those polls turned out to be as a majority of Britons cast their votes in favor of leaving the EU. This is a bona fide historic event but it is not a cause for panic and should not alter the basic calculus for the vast majority of individual investors.

Not surprisingly, global equity markets sold off by as much as 8%, the British pound plummeted, the euro fell and the price of gold jumped to a two-year high. Morning trading on the New York Stock Exchange is much tamer than elsewhere with the major stock indices moving down by 2.0-2.5%, on average. Fixed income markets are moving decidedly higher.

In the short-term, MCM portfolio managers are busy sorting through the carnage hunting for mispriced assets that can be bought at attractive discounts and/or sold for outsized profits. Our objective to maximize investment rate-of-return in client portfolios remains unaffected by the events in Europe.

Longer-term, all eyes will be on other EU countries and whether or not they follow Britain’s example and stage referendums of their own. Italy, Spain and Greece immediately come to mind. A total collapse of the EU is not out of the question. The only sure thing is that capital market volatility will be with us a good while longer.

Long-Term Investor, Short-Term Attention Span

Society has an activity addiction. We constantly need to be entertained. So much so that the average human attention span is only 8.25 seconds – down from 12 seconds a decade ago and almost an entire second less than a goldfish’s, according to Statistic Brain. Undoubtedly, millennials bring this average down a bit. 77% of people aged 18-25 said if nothing is occupying their attention, they will grab their phone, compared to only 10% of those over age 65. Begrudgingly, I can attest to this. I’m currently working to complete my MBA degree through Ohio University, which is rewarding but includes a lot of paper writing. Although I’m thriving, I’ll admit if I had a nickel for every time I checked my phone, answered a text message or opened an off-topic internet tab instead of focusing on a paper, I wouldn’t need to earn my MBA…I’d just buy one.

*stops writing this post to research the going price for MBA degree*

Obviously I can’t actually buy a graduate degree and as easy as it is to joke about the fact that many of us can’t pay attention anymore, this notion made think (impressively, for more than 8 seconds) about how investors are affected by short attention spans. This mindset makes investors hypersensitive to trading frequency (“Why didn’t my investment adviser buy anything today!?”) and short-term price movements (“She bought that for me last week, why is it already down -1%!?”). This mentality can cause investors to “act just to act,” or worse, act solely on short-term volatility.

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