Emotional Investing, Biases, & Long Term Views

Each week, the Stokes Family Office staff puts together a list of our favorite news and updates on all things wealth management. From financial planning, portfolio construction, tax and estate planning, retirement plan services to anything we found interesting.  Enjoy this week’s curated list for your weekend reading!

ECONOMY NEWS

Near-Term Gloom, Long-Term Boom

• Scott Grannis maintains an optimistic long-term outlook. He believes that the substantial reduction in tax and regulatory burdens will ultimately foster economic growth. However, he acknowledges the difficulty in balancing the near-term negative effects of policy changes against their long-term benefits.

“A Little Disturbance”

• Josh Brown: “A lot of people believe Trump and Bessent are deliberately orchestrating a recession. I don’t.”

• He and Michael Batnick (both of Ritholtz Wealth Management) discuss the “Hard Reset Theory” and the market moving news of the week.

Don’t Assume You Know

• Adam M. Grossman writes, “The U.S. Stock Market has historically delivered similar returns under both Democrat and Republican administrations. For that reason, my view is that investors shouldn’t worry too much about who occupies the White House, and I tend to stay away from investment discussions that involve politics. But sometimes, the news coming out of Washington dominates the headlines in a way that can’t be ignored.”

MARKETS NEWS

It’s OK to Gave Emotions — Just Don’t Let Them Near Your Stock Portfolio

• Sam Ro: “When the stock market falls more than 1% in a day or a couple percentage points over a couple of days, I always get the feeling that it’s the beginning of a much bigger sell-off. This has been consistent in my 19 years of writing about stocks. But something that has changed over the years is my growing familiarity with the data, which has made me a better investor less prone to making emotionally-driven adjustments to my portfolio.”

The Crystal Ball Test

• Joe Wiggins explores the concept of focusing on investment factors that are both important and knowable, drawing inspiration from Warren Buffett’s investment philosophy.

• He concludes that investors should align their strategies with factors that are both significant and reasonably predictable, avoiding reliance on unpredictable elements.

My Bias Blind Spot Bubble

• Barry Ritholtz draws parallels between his feelings toward officials refereeing his favorite NBA team and investing, emphasizing that emotional involvement can cloud judgment in both arenas.

Stokes Family Office is 100% Family Owned, and has been continually operating in the New Orleans Area for over 35 years.  As a family office, we are focused on family wealth, financial planning, and tax planning. We are your local experts for Gulf South wealth management. Want to hear more from our team? Check out the Lagniappe Podcast.