Old School Strategies Yeild Old School Results
By Jason Glisczysnki
There is an old adage that reads, “if you always do, what you always did, you’ll always get what you always got, and if that isn’t the result you want, do something different!” So many times I hear investors say things like, “I know I lost money, but so did a lot of other people”. How does somebody else losing money make it ok for you to lose? I never understood that, until I started taking a step back to examine what is happening in the investment world of today. So many people are part of the herd, paying so close attention to what their neighbor is doing and forgetting to examine the true end results of their own choices. With so much information out there and the Internet connecting us to everything with lightning fast speed the general markets have become a very volatile place with a lot of investments simply riding the waves up and down like a boat on water.
The “old school” train of thought is buy and hold a mix of stocks, bonds, and cash for the “long haul”. Close examination over the last 25 years of the stock market shows that this strategy is not only flawed, but actually can be quite dangerous, and historically doesn’t actually work most of the time, now more than ever before.
So how do you break free from doing what everyone else is doing? You need to swim upstream, go against the grain and find out what works that other people aren’t doing. Some examples of this include using non-correlated assets in your portfolio. Most commonly people use REITs to accomplish this. To purchase one you must be an accredited investor, which means by definition you must have over $1 million in investable assets, or an annual income of over $250,000 per year for at least the last two years.
If you do not fulfill those requirements and have purchased a REIT in the past you may want to research your options for being compensated for that transaction. Other non-correlated assets that you can use that you do not have to be an accredited investor to purchase would be MLCDs (market linked certificates of deposit) and structured notes. These investments carry some backing by the institution that issues them, and some of them also have FDIC protection.
Jason Glisczynski, CAS
Investment Advisor Representative
Certified Annuity Specialist
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This article was written by Jason Glisczynski and is not to be treated as investment advice. Investment Advisory Services offered through Brookstone Capital Management, an SEC Registered Investment Advisor.