RETIREMENT INVESTING: WHAT YOU MUST KNOW
The investment climate changed radically a few years ago. The next 6-12
years are going to look at lot more like 1966-81, which was a "secular bear market"
than 1982-99, an incredible "secular bull market." Investors who do not realize this
and do not adjust their investment stategies and tactics accordingly are almost certain
not to meet their financial goals. For baby boomers, that means not being able to
retire at the time or in the manner they want.
- Severe equity losses can destroy the best laid
plans. During a secular bear, they are deeper and take much longer to recover.
- See what happened in 1973-74, 2001-02, and 2007-08. Can
you withstand stock market losses over 45% like we have just seen? It can happen again
before this secular bear market is finished.
- Convential advice is little help. Most brokerage
houses and Wall Street "experts" advocate such things as buying and holding stocks,
dollar cost averaging, and diversifying by adding bonds and/or international investments
to portfolios. The first is a recipe for disaster, and the other two may help a little
bit, but they are not likely to avoid the lurking danger.
Combining the best ideas from traditional Wall Street thinking (not all of what they
say is useless and some authors are well worth reading) with active tactical asset
allocation, the risks of losses that can destroy retirement and other financial plans
can be reduced to acceptable levels and virtually eliminated for those who are extremely
risk adverse or those who are or will soon need to start living off of their investment assets.
- Appropriate asset allocation is the first step.
- Risk reduction models to decide when to invest in an asset
class such as stocks or bonds and when not to because the risks are too high. The models employed are
fairly simple and tested over a period of more than 40 years so they are likely to be
useful investment tools in the future.
- Sample investment return histories for some basic
portofios and asset allocations. These show the value of the approach and cover a range
from very conservative to moderately aggressive. The most conservative allocation with
the use of the models had reasonable returns without a losing year in testing
that started in 1963.
MDP Associates (Mark Pankin) can help you or your firm manage your
retirement plan accounts [IRA, Roth, SEPP, 401(k), 403(b)] to acheive your financial goals
or enable employees and plan participates to reach theirs. There are two basic levels of
- Do it all for you by helping determine an appropriate
asset allocation, and then managing your accounts by performing all the necessary analysis
and placing the orders needed when a change in the investment in an asset class is needed.
The benefits include convenience, not having to pay close attention yourself, and knowing
that the needed actions will be taken.
- Help you do it yourself through weekly e-mails
with the current status of the models and a quarterly newsletter
that provides a recap of the past quarter's market action,
an overview of the current investment climate, and sample asset allocations for a range of
investors. Firms can distribute the newsletter as a benefit to participants in their retirement
plans. The models almost are evaluated with end-of-the-week data,
and the weekly e-mails will be sent to you over the weekend, so you can make your decisions
and place your transactions for Monday execution.
- About MDP Associates.
D. Disclaimer and Disclosures. These pages with
important information are also reached from some of the links above, but you may want to
see them right away. They discuss the nature of hypothetical performance figures and what
you should know about them as well as some consumer information for potential clients of
MDP Associates as a Registered Investment Advisor.
Start with the Lurking Danger Page
For fastest response, either e-mail to "retire -ATsign- pankin.com" (sorry about
not providing an e-mail link, but spamming creeps tend to harvest those) or call
(703) 524-0937 during normal business hours (Eastern time).