Learn How Your Company’s Financial Wellness and 401k Plan Can Make Your Life Better

Does your employer love you? 

Find out why financial wellness plan are essential to employee productivity, happiness and reducing stress... Yet most employers don't have them. Want to know why?

This week we discuss financial wellness plans, 401k plans, and George's podcast, Money Savage. This is a great interview with one of the industry's famous podcast hosts.


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Looking for a better way to invest? 

Consider Betterment.

It doesn’t cost much to start, and you get access to a portfolio built around your risk tolerance and your goals. Using Modern Portfolio Theory, pioneered by a Nobel laureate, Betterment can help you build wealth without getting caught up in the noise of the market.


Today's Guest:  George Grombacher

I'm a former Division 1 scholarship athlete in tennis.  I serve on the Foundation Board for Goodwill of Central and Northern Arizona, the Phoenix Police Department's Citizen Review Board and I'm the President of the Phoenix Alumni Chapter of Sigma Chi. 

I'm the President of Financial Consulting Professionals and the Founder and Chief Community Officer of Money Alignment Academy. 

I've been named to Investopedia's list of the Top 100 Most Influential Financial Advisors.  

I'm the host of the Money Savage podcast and the cohost of the Figure it Out podcast.  

Emilie is my wife and James and Jack are my boys.

George Online Presence:


Today's Panelists

Real Estate Note Investing With Penni Zelinkoff – Learn How To Invest In Real Estate Without The Headaches

Are you looking to invest in real estate? 

How would you like to invest in real estate without fixing toilets, roofs, dealing with tenants or contractors? Sound too good to be true? Its not. Learn how some of the expert real estate investors invest in real estate with less risk and less stress.

Investing Outside of the Box – Real Estate Note Investing Made Easy

BY PENNI Z (ZELINKOFF) / MAY 1, 2020 / INVESTOR

Did you know that there is an estimated “76% of American’s that are worried they won’t have enough to retire” according to a Forbes Article, April 2019.  Fast forward to May 2020 and the market has shifted and is no longer the strong economic market it was 2 months ago and we are now wondering what the “new” future will hold, will we have a job, stressed about the stock market’s volatility and how will the real estate market fair post pandemic? 

What would it look like if you could make money in an up or down market and not worry about the “market”?   I would love to say something is recession proof, yet we can’t guarantee anything in life, yet this concept could be very close.    The one thing I have learned in Real Estate over my 20 years of experience, is in a good market or a down market real estate investors always need money.

So, what would it look like if you could achieve a higher rate of return faster than traditional investing (5-7%) or savings account at (0-1.5%) annual rate?  What would it look like if you created cash flow, build wealth and had the option to “retire” earlier and without the financial stress? 

What would that look like?

What would it look like if you had an investment strategy that not only helped you achieve your financial goals it helped other entrepreneurs/business owners achieve their financial and retirement goals too.  Wow, what would that look like, feel like?!   A WIN WIN WIN!

There will be fall-out from Covid 19, that’s reality you don’t shut down the world and expect it to be normal, yet I’m optimistic and there will be a lot of new and existing opportunities that will arise from this experience, there always is – the key is to be ready.

Anticipating the shift in the real estate market is real, I have been in real estate for 20 years and every 7-10 years there is a shift, we just don’t’ know when and by how much.  This time we know when, it’s now!  The real question is by how much?   Well that will show itself soon.  Being on multiple calls with expert investors, financial advisors and bank representatives they all have said they believe that within the year or less it will turn towards a buyer’s market. 

So when people ask an agent, “how is the market” no matter what kind of market it is they always say “good”.  Why because you can buy and sell property and make money in any type of market and for real estate investors it’s preferable and generally easier to buy and build a portfolio in a lower priced buyers market.  The key is to have access to cash and/or credit lines/lending.   Yet as we know, in years with a down economy those are two areas that generally tighten up; Money and Lending.

A little history, for over a century we have been taught to invest our money in the stock market in various ways; stocks, bonds, futures, currency and mutual funds inside or outside our retirement accounts.  Yet after all that “investing” year over year American’s are still worried about their retirement and money concerns.  And if what goes up must come down, then there will always be an economic cycle so why not think differently!

Even with the U.S. economy rounding into shape, 65 percent of Americans say they lose sleep over financial concerns, according to a survey by CreditCards.com. That’s just four percentage points fewer than the share of Americans who had money-related insomnia back in 2009, when the economy was a hot mess.  In 2007, just prior to the Great Recession, 56 percent of Americans was losing sleep over financial worries, with the figure shooting up to 69 percent in 2009.”

BY ANNA ROBATON, APRIL 20, 2017 / 12:01 AM / MONEYWATCH

I Challenge you to NOT be a part of the above Statistics.

The above article was written during a strong economy, I’m curious how people are feeling today and how this statistical number has been affected?  And yet because I’ve been here before; past behavior predicts future behavior, what goes up comes down and history repeats itself; this time I’m prepared and I want you to be as well. 

We are taught to diversify our portfolio, you maybe diversified yet are still under one overall umbrella - Wall Street; mutual funds, stocks, bonds etc all tied to the stock market.  If you are a savvy investor you have already or are willing to diversify your money into other investment tools like real estate.

 

For those of you who manage your own investment portfolio and are doing well, that is great, I challenge you to look into diversifying even more!  For those that have money invested and someone else manages your account(s), which is Most Americans, you probably have no idea what you are invested in, how much your annual rate of return is on your money and have no idea the amount you are charged in fees associated with your account(s).   If you don’t know the answer to these simple questions you should, go ask your financial planner today.  And then have a second opinion, have someone else (independent) look at your portfolio from a financial “advisor” perspective to verify the facts.  Then call me and let’s talk.

A special side note here:  Women I challenge you to be bold and take charge of your money - we have been overlooked in financial management, investing education and money mentorship for decades.  Now is your time!  We typically don’t have the “Money talk” and are afraid to ask questions, or we get answers like don’t worry everything is taken care of, you are making money don’t worry or…. 

It stops here!!  Ladies we Need to take our power back, educate ourselves and

Have a Voice and a Choice in our Financial Freedom.

It’s my opinion as well as other industry experts and financial advisors that I have spoken with that the real winners making money on our money is not us, it’s the institutions who manage our money.  The financial experts say that on average an American who has their investments in a retirement account over the course of its lifetime with the up and down markets make an average of only 5-7% interest on their money over time and that doesn’t take into account inflation and taxes.   No wonder we are all stressed about retirement and when we get there have less than we thought we would.

Take a look at today’s numbers for interest rates dated April 2020:

Traditional Investments: As of April 2020

            Checking/Savings Account 0-1.50% apy

            CD at Bank/Credit Union .25-1.65% apy

            Money Market 0-1.80% apy

            Stocks – vary average 5-7% average over time

            Bonds – vary average 5-7% average over time

            Retirement account 401k, Roth 5-7% average over time

Be Empowered:  knowledge, mindset, mentorship and making forward thinking investment decisions that create results is empowerment!  I want you to want to look outside the traditional investing box, outside the way we have always been taught to invest to a NEW World:

It’s a New Era, a New World, perhaps a Better World, A New Way of investing.

If we Know Better, we Think Better, we Do Better. – Penni Z

 “To understand what this means, consider an investor who was unlucky enough to invest a lump sum in the stock market on the exact day of that October 2007 high. Provided he or she had the intestinal fortitude to stay with the investment through thick and thin, and reinvest all dividends along the way, the investor would now be in the black.”

How long did it take?   This unlucky investor was under water for four and one-half years.

By: MARKHULBERT, COLUMNIST, MarketWatch

Instead of losing money for 4 ½ years during a down turn or any time really – if you had the availability to make money during this time at an annual average rate of return between 8-15%, what would you chose?  Lose money or make money – I’m choosing to make money!!

Individuals around in 2008-2010 were most likely financially affected by the crash.   The economy is having another shift and we now face another down turn that could be worse than 2008.  If you were younger than 30 in 2008 you may not have experienced a direct effect though you saw the effects of  the downturn of 2008 and now not only are your parents/grandparents/friends facing another down turn in their life-time SO are YOU.   Article from bigger pockets on outlook:  (biggerpockets article:)  https://www.biggerpockets.com/blog/5-reasons-2020-recession-completely-2008?utm_source=newsletter

Now, I’m not a doom and gloom kind of person, and I’m not here to say investing the traditional way is wrong, I am here to challenge your thinking as an optimist, a realist, a real estate investor and Secured Asset Lender and to say there is another way to invest!  It’s the perfect time to do something different and shift from the same old “traditional” way of investing.   It’s ok to change your mindset and pivot your investing strategies.  It’s easier than you think!

 

Take Action - Take Control

of your investing, your money, your results and your future!!

For those savvy investors who day trade, keep up with the stock market, economic indicators and help their financial planner manage your money this program works great for you because you like to DIY and be involved on the ground floor.  For those less DIYers and more DIFM, (do it for me) personalities it is absolutely worth having a conversation of what that looks like for you and your options for adding Secured Asset Investing to your portfolio.

Secured Asset Investing gives you the POWER to be in control of your money.  The appeal to this type of investment is that you can be any age, you can live anywhere, invest any time and anywhere in the US.  By having various money sources available to use you can create the return you desire and the lifestyle you deserve.  Once you learn the how to of Secured Asset Investing it is simple.  With Secured Asset Investing you can create a higher average rate of return than “old” traditional investing strategy, without the stress of “watching the market”.   There are two basic types of investing short term (1-12 months) or for those Set it and Forget it types there is longer term investing (12-84 months)  Risk is minimized and management buy strategy, boundaries and evaluation just like other type of investing.  And the great benefit is you secure your money (your asset) to a real estate asset with a secured note.   Once you learn and understand the dynamics of Secured Asset Investing you will see there is much more upside than downside.

Why is Secured Asset Investing a viable investment strategy with plenty of upside in Today’s market and the future?  It’s a relationship investment model where one person with money connects with one real estate investor in need of money on one investment property.  Rinse and Repeat.

One to One to One – Transactional Secured Asset Investing

As we know in a down market money supply tightens, fewer lending options are available to real estate investors and yet real estate investors will still need access to cash to continue to run their business.   Why not build a portfolio of result oriented investment options through lending on real estate transactions.   

What if you took a reasonable percentage of your money from a saving account, investment account, retirement account, whole life insurance, inheritance, capital earned from your business and invested in

Secured Asset Investing - what would that look like to your bottom line?

Secured Asset Investing is a way to be involved in real estate without owning any property, managing any rentals, coordinating any fix and flip projects, negotiating with sub-contractors or working with other industry personnel: 

  1. You are in control
  2. You chose the investments
  3. Negotiable Return on Investment (ROI)
  4. Multiple exit strategies for a Win Win – low risk structured investment
  5. Large group of investors to chose from
  6. Access to real estate investors in an up or down market (investors always need money)
  7. Money is secured by real estate
  8. Stay local or go national
  9. Sit back, relax and collect a check

You may ask why would a real estate investor use an individual investor/lender instead of a traditional lender?  Great question, for many reasons:

  • Property does not qualify for traditional lending
  • Real Estate investor does not qualify for traditional lending (self employed, other)
  • Traditional lenders do not like to fund fix n flips
  • The “deal” doesn’t fit traditional lending guidelines
  • After a certain number of “investment” properties the traditional lenders may not loan to an investor
  • Guidelines have changed in traditional lending and money tightens
  • Build relationships for multiple investment transactions
  • More flexibility on amount of loan, timing on funding, letter of approval
  • Quick Close
  • Less red tape
  • Real Estate investors are in business to make money and they understand there will be a higher rate to have this type of loan

What would it look like for you, your family, your future, your lifestyle, your retirement?

CREATE CASH FLOW

BUILD WEALTH - QUICKER

HIGHER RATE OF RETURN

PASSIVE INCOME BUSINESS

FLEXIBLE LIFESTYLE

MORE FREEDOM

RETIRE SOONER

FAMILY TIME

Here is what an average rate of return could look like as a Secured Asset Investor:

This real estate investor is a Landlord who has been in business for 5 yrs and has 20 properties.  He has a strong track record, has references and success with high occupancy rate, solid rent pricing and management of his business and rental portfolio.  He is looking for $100k loan for 5 yrs to purchase a duplex the terms are 5 yr loan, 10%, 2% points of loan and $1000 admin fee.  The Secured Asset Investor is the “bank” yes the bank with a note, mortgage and is in 1st position with a recorded deed.  There are very strong arguments why it’s good to be the “bank”.  Learning to Lend is a profitable investment strategy – let’s look at the banks and mortgage companies and how much money they make on their “lending” business:

Traditional Mortgage Company:

30 year fix rate at 4% (today’s average interest rate) on $100,000 loan will make $71,870 over the 30 years, now multiple that by tens of thousands.  Not a bad day at the office.

Back to our “example” of being the bank:

Rental Purchase Example:      (Real Estate Investor working with a Secured Asset Investor)

Loan $100,000, 10% interest, 5 yr term (secured asset lender receives interest, points, admin fee and original principle back)

Payment is $833.33 to the lender, annual income is $10,000 - 5 year income is $50,000

Lender received at closing the 2% points or $2,000 and $1,000 admin fee

Total Amount earned on $100,000 loan for 5 years is:   $53,000 vs. traditional investing

Example of traditional investing, if you kept your money in a CD at the bank or invested in the market, this is what you may have made on $100,000:

$100K 5 yr CD at 1.65%                         $ 8,250

$100k 5 yr retirement 5%                       $27,628

$100K 5 yr as Secured Asset Investor     $53,000

If you main decision right now was to determine if you are a DIYer or DIFM person after having a Free Business Strategy conversation with us how hard would that be?  For more information, learn about our training programs and to speak with us at Penniwize:  email or text your full name, email address, phone number with SAI in subject to:  zteam@penniwize.com or text 702-518-5590

The materials and information shared by Penni Zelinkoff and/or Penni wiZe Empowerment Network LLC or Penniwize (collectively, “PW”) is not and should not be considered financial, investment, legal, or other professional advice. Instead, said materials and information are intended as an overview for educational and training purposes. PW’s blog, website, newsletter, presentation materials, and/or any other forms of communication may contain general information about legal, financial, investment and related matters. Additionally, in the event that third party information is included or presented within the scope of PW’s blog, website, newsletter, presentation materials, and/or any other form of communication presented by PW, such inclusion or presentation does not reflect the opinions of PW. In all cases, said information is not being delivered as professional advice and should not be treated as legal, financial, investment, or other professional advice. You must not rely on the information on this website as an alternative to professional advice from your attorney, financial or investment advisor, or other professional services provider. If you have any specific questions about any matter you should consult with the appropriate legal, financial, or other professional services provider.

Subscribe & Download

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Listen on
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Sign up to be one of our Money Tree Ultimate Insiders. You will have instant access to new episodes, automatically have access to our monthly giveaways, and the potential to be a guest panelist on our show


Looking for a better way to invest? 

Consider Betterment.

It doesn’t cost much to start, and you get access to a portfolio built around your risk tolerance and your goals. Using Modern Portfolio Theory, pioneered by a Nobel laureate, Betterment can help you build wealth without getting caught up in the noise of the market.


Today's Guest: Penni Zelincoff

Penni is a real estate investor, real estate lender and wealth empowerment educator. For over 18+ years she has built an extensive network of investors and real estate professionals. She is now teaching her proven formula for building wealth to the general public.

She is the CEO and Founder of di-veZt and The Penni Z Show. Our mission is to help a million lives – by empowering our clients to have a Voice and Choice in their financial freedom.

Penni trains her clients to minimize the roller-coaster ride that so many have experienced in life around finances. She believes that personal, professional and financial stability go hand in hand. She’s passionate about sharing her training and mentoring program with you. This opportunity to learn a very effective way to create cash flow and build wealth is powerful – it’s called “Secured Asset Lending”.

Penni's Online Presence:


Today's Panelists

The CARES Act Simplified – Everything You Need To Know In Easy To Follow Terminology

Have you heard of the CARES Act?

It's the government's attempt to give you free money... Interested in learning more? 

We discuss the ins and outs of the CARES act and how you can benefit from this new government bailout of America. Yes its that "Huge".

We brought on 3 experts this week to discuss what you need to know.

CARES Act


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Listen on
Apple Podcasts​​​​
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Spotify
Follow us on
Stitcher Radio

Sign up to be one of our Money Tree Ultimate Insiders. You will have instant access to new episodes, automatically have access to our monthly giveaways, and the potential to be a guest panelist on our show


Looking for a better way to invest? 

Consider Betterment.

It doesn’t cost much to start, and you get access to a portfolio built around your risk tolerance and your goals. Using Modern Portfolio Theory, pioneered by a Nobel laureate, Betterment can help you build wealth without getting caught up in the noise of the market.


Today's Guest:  Jeffery Levine

Jeff is a multi-millionaire stock options trader and economist with nearly 20 years of experience under his belt. He failed building 4 businesses– even tried his hand as an online poker player, but learned each step of the way to becoming a multi-millionaire before the age of 35.  

Now he dabbles in virtually every aspect of the market, but has a special gift and passion for trading options and has become the #1 live-streaming stock options trainer in America. While he maintains a disciplined approach to the market, he’s also not afraid to make the big bets and swing for the fences when he thinks there’s an edge on a trade.

Raging Bull has a large following with over 2 million unique users on its website each month, a user base of over 500,000 paid and free members in their network and over 200,000 social media followers.

Jeff's Online Presence:


Today's Panelists

3 Famous Investors You Need To Know To Invest Successfully

How would you like to get into the minds of the top 3 investors of all time?

We do that this week on our show... 

We interview Scott Chapman about his new book, Empower Your Investing where he analyzes the top 3 investors of our time and why they were successful. We discuss Peter Lynch, John Templeton, and Warren Buffett.


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Never miss out on a new episode! Subscribe using your favorite podcast app.

Listen on
Apple Podcasts​​​​
Follow us on
Spotify
Follow us on
Stitcher Radio

Sign up to be one of our Money Tree Ultimate Insiders. You will have instant access to new episodes, automatically have access to our monthly giveaways, and the potential to be a guest panelist on our show


Looking for a better way to invest? 

Consider Betterment.

It doesn’t cost much to start, and you get access to a portfolio built around your risk tolerance and your goals. Using Modern Portfolio Theory, pioneered by a Nobel laureate, Betterment can help you build wealth without getting caught up in the noise of the market.


Today's Guest:  Scott Chapman

Scott A. Chapman, CFA

Chief Executive Officer and Portfolio Manager

Scott A. Chapman is a Chartered Financial Analyst, CEO and Portfolio Manager of Chapman Investment Management, LLC, which he founded in 2013. He has more than thirty years of experience managing investment portfolios and performing securities analysis.

Mr. Chapman was Managing Director and Portfolio Manager with Lateef Investment Management from 2002-2012, during which time the firm’s assets grew from $500 million to over $5.5 billion. At Lateef, Scott was a member of a three-person portfolio management team that delivered investment performance in excess of the S&P 500 by an average of 3.8% annually and outperformed the index in nine of eleven years, all with lower portfolio risk. The Lateef mutual fund earned the top five-star rating by Morningstar rating agency.

Previous positions included Senior Portfolio Manager, Director of Large-Cap Growth Strategy, and Research Director at Dreyfus Founders Asset Management, and Senior Portfolio Manager and Director of Growth Strategy at HighMark Capital Management. At HighMark, he designed and managed the investment strategy for the HighMark Growth Fund, which was also awarded a top five-star Morningstar performance rating.

Mr. Chapman received his M.B.A. in Finance from Golden Gate University and his B.S. in Accounting from Santa Clara University.  He taught investment principles to CFA candidates in San Francisco for seven years. He also developed and instructed investment seminars, called “Lessons from the Masters,” which profiled the investments principles and case studies of stocks used by Sir John Templeton, Peter Lynch, and Warren Buffett.  Mr. Chapman recently wrote a book called Empower Your Investing—Adopting Best Practices of John Templeton, Peter Lynch, and Warren Buffett which will be published in August 2019 and is available on Amazon and Barnes & Noble at the links below. Mr. Chapman is a national board member of Positive Coaching Alliance, former Chair of the Alumni Advisory Board for Golden Gate University’s graduate school of business, and volunteers at several other non-profit organizations.  He is married, has two grown children, two grandchildren, and enjoys hiking, cycling, swimming, reading and the fulfillment of making a positive difference in building clients’ capital.

Investing is a life skill and, like any life skill, the key is to learn from those who have already done it well. Empower Your Investing­: Adopting Best Practices of John Templeton, Peter Lynch, and Warren Buffett offers a success-based framework, discipline, and toolkit for investing success.


Find Scott's Book, Empower Your Investing: Adopting Best PRactices From Peter Lynch, John Templeton, and Warren Buffett


Today's Panelists

Investing in Natural Resources With Industry Legend Rick Rule

Investing in natural resources is hard... no, its foolish... unless you know what you are doing. If you understand the industry it is a gold mine (pun intended).

Industry insider Rick Rule talks about his decades of experience investing in natural resource stocks, warrants, and other related investments. He brings his practical experience to the pie in the sky ideas that most investors are looking for. Gold, Silver, Platinum, Uranium, and more. We discuss the best ways to invest in this sector without losing your shirt.


Subscribe & Download

Never miss out on a new episode! Subscribe using your favorite podcast app.

Listen on
Apple Podcasts​​​​
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Follow us on
Stitcher Radio

Sign up to be one of our Money Tree Ultimate Insiders. You will have instant access to new episodes, automatically have access to our monthly giveaways, and the potential to be a guest panelist on our show


Looking for a better way to invest? 

Consider Betterment.

It doesn’t cost much to start, and you get access to a portfolio built around your risk tolerance and your goals. Using Modern Portfolio Theory, pioneered by a Nobel laureate, Betterment can help you build wealth without getting caught up in the noise of the market.


Today's Guest:  Rick Rule

Rick Rule 

President and CEO

Sprott U.S. Holdings Inc.

Mr. Rule has dedicated his entire adult life to many aspects of natural resource securities investing. In addition to the knowledge and experience gained in a long and focused career, he has a worldwide network of contacts in the natural resource and finance worlds. Mr. Rule is also a director of Sprott Inc., the parent company of Sprott U.S. Holdings Inc. As President and CEO of Sprott U.S. Holdings Inc., Mr. Rule leads a highly skilled team of earth science and finance professionals who enjoy a worldwide reputation for resource investment management.

Mr. Rule is a frequent speaker at industry conferences, and is interviewed for numerous radio, television, print and online media outlets concerning natural resource investment and industry topics. He is frequently quoted and referred by prominent natural resource oriented newsletters and advisories.  Mr. Rule and his team have long experience in many resource sectors including agriculture, alternative energy, forestry, oil and gas, mining and water. Mr. Rule is particularly active in private placement markets, having originated and participated in hundreds of debt and equity transactions with private, pre-public and public companies.

Sprott U.S. Holdings Inc. is a holding company made up of three separate and distinct companies: Sprott Global Resource Investments Ltd., a FINRA Registered Broker/Dealer; Sprott Asset Management USA, Inc., an SEC Registered Investment Adviser offering managed accounts; and Resource Capital Investment Corp., an SEC Registered Investment Adviser that manages Limited Partnerships.  These three companies make up the U.S. Subsidiaries of Sprott Inc., and are active in securities brokerage, segregated account money management and investment partnership management involving both equity and debt instruments, across the entire spectrum of the natural resource industry. 

Rick's Online Presence:


Today's Panelists

How To Deal With An Economic Crisis (COVID 19)

How are you acting during this health and economic crisis?

Are you being reactive, proactive, or are you leading others to help your community?

Are you financially resilient?

statistically 10% or less people are leading and 80% are being reactive. learn why and what you can do in times of crisis to thrive and come out of the crisis more resilient.

economic crisis


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Never miss out on a new episode! Subscribe using your favorite podcast app.

Listen on
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Spotify
Follow us on
Stitcher Radio

Sign up to be one of our Money Tree Ultimate Insiders. You will have instant access to new episodes, automatically have access to our monthly giveaways, and the potential to be a guest panelist on our show


Looking for a better way to invest? 

Consider Betterment.

It doesn’t cost much to start, and you get access to a portfolio built around your risk tolerance and your goals. Using Modern Portfolio Theory, pioneered by a Nobel laureate, Betterment can help you build wealth without getting caught up in the noise of the market.



Today's Panelists

Learn How Tactical Asset Allocation Investing Strategies Could Protect Your From The Market Next Downturn

Are you worried about the next market downturn?

Want to know how to protect yourself?

Want to know why you have never heard about this type of investing from your broker?

We interview an up and coming quant and tactical asset allocation manager and discuss how tactical investing can protect your assets during adverse market conditions. Don't miss this episode with PJ DuWors of Q32 Capital Management.


Subscribe & Download

Never miss out on a new episode! Subscribe using your favorite podcast app.

Listen on
Apple Podcasts​​​​
Follow us on
Spotify
Follow us on
Stitcher Radio

Sign up to be one of our Money Tree Ultimate Insiders. You will have instant access to new episodes, automatically have access to our monthly giveaways, and the potential to be a guest panelist on our show


Looking for a better way to invest? 

Consider Betterment.

It doesn’t cost much to start, and you get access to a portfolio built around your risk tolerance and your goals. Using Modern Portfolio Theory, pioneered by a Nobel laureate, Betterment can help you build wealth without getting caught up in the noise of the market.


Today's Guest:  PJ Duwors

PJ DuWors is a former engineer who has worked in quantitative finance for 13 years.  His passion for systematic investing was sparked in business school, where he was the president of Anderson Student Asset Management, a student-run quantitative fund.  PJ started his career on Wall Street with Lehman Brothers in 2006 as a structured notes trader. In this role, he was responsible for structuring complex securities linked to various asset classes and trading derivatives, credit, and interest rate risk.  He has held similar roles at Barclays, UBS, and most recently as a Senior Vice President at Jefferies. In 2015, PJ founded Q32 Capital Management to put into practice quantitative strategies he had been developing for a decade.


PJ graduated from the University of Notre Dame in 2001 with a Bachelor of Science in Mechanical Engineering.  He began his career as a satellite operations engineer at Northrop Grumman in Redondo Beach, CA. He then earned a Master of Business Administration with a concentration in finance from UCLA Anderson in 2006.

PJ's Online Presence:


Today's Panelists

Historical Stock Market Returns – Learn From The Past To Predict The Future – Barbara Friedberg

Are you looking at historical stock market returns as a way to find the next hot investment?

Learn why that can cost you money and how some of the top investors look at historical stock market returns. We dig into past performance and discuss how you can use that to benefit your portfolio. We interview seasoned stock market veteran, Barbara Friedberg about how you should look at historical stock market returns.

Historical Returns

Show Resources:

If you are looking for great resources to find out how to track historical returns, this is a good list of resources to use for accurate data.

Recommended Books:

Historical Risk

Subscribe & Download

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YCharts - Smart Investment Decisions Made Simple

We here at Money Tree Podcast use YCharts to uncover new investing opportunities, analyze trends and monitor our progress. YCharts is a powerful financial data platform designed for Individual Investors, Financial Advisors and Asset Managers. Their platform makes our lives easier. What can be better than that.

We struck a deal for our listeners where you get 20% off your access to YCharts if you sign up in the next month


Today's Guest:  Barbara Friedberg

Barbara Friedberg, MBA, MS is a former investment portfolio manager, author of Personal Finance; An Encyclopedia of Modern Money Management and How to Get Rich; Without Winning the Lottery. Friedberg is a former university Finance and Investments instructor, and publisher of Barbara Friedberg Personal Finance.com and Robo Advisor Pros. Her work has been featured in U.S. News & World Report, Yahoo! Finance, Investopedia, GoBankingRates, and many more publications.

Barbara's Online Presence:


Today's Panelists

Investing Legends: Steven Bregman – Value Investing In Uncertain Market Conditions

Markets around the world are overpriced. Value stocks have under-performed for over 10 years. If you are a value investor, where do you invest?

This is one of my favorite interviews. This week we  interview Investing Legend, Steven Bregman. He explains how he looks at the markets from a value lens, why value investing is important to overall market health, the danger of low interest rates, why you should worry about the indexation of markets, and the bond ETF bubble. We cover a lot in this episode, but if you are serious about investing, this episode is pure gold.

Value Investing

Value Investing - One Historical Extreme Among Many

Interest rates are now the lowest in the recorded history of mankind. Here is a sampling from across the scope of global history to give you a sense of what ‘normal’ rates are.

o   Over the course of 600 years through 100 BC, the ancient Greeks generally charged between about 6% and 12% for loans secured against real estate or to cities.[1]

o   During the 1300s, in Venice, long-term loans to States were generally in the 5% to 8% range.

o   In 1799, after Napoleon gained power, France issued 5% bonds.

o   In the 1860s, during the Civil War, U.S. Treasuries were largely in the 4 ½% to 5 ½% range.

o   During the entire 20th Century, there were only 3 separate years – all during the 1940s – when U.S. 10-year Treasuries declined below 2%. This reflected the government’s extraordinary mobilization of the economy for World War II. To understand the extremity of that environment, every American citizen was issued ration books, with coupons that were required for buying necessities ranging from gasoline to butter. Infractions were punishable by fines up to $10,000 – in 1940s dollars! That would be roughly $300,000 today.

[1] A History of Interest Rates, Sidney Homer, Rutgers University Press, New Brunswick, NJ. 1963.


Bonus Insight into YCharts Stock Screening Tools

Value Stocks Travel Industry
Value Stock Screen

 

The Path to Indexation Dominance of Modern Investing

The 2008/2009 Financial Crisis catalyzed an accelerated movement toward indexation:  no one wanted security specific or manager specific risk. They wanted a basket of securities.  The accumulation of over a decade of $100 billion+ annual flows into ETFs looks a little like this:

  • At March 2009, there were fewer than 100 ETFs in the U.S., today there are over 2,000.  This occurred even as the number of listed stocks in the U.S. declined by about 25%.
  • The ETF industry in March 2009 had total assets of $485 billion, today it’s $4 trillion. Just a single ETF, the SPDR S&P 500, now has over $300 billion. 

An ocean of buying power has been directed at an ever-smaller sub-set of mega-companies with sufficient share trading liquidity to serve index funds’ needs.  Last year, Indexed equities passed that critical 50% border: they are now well above 50% of all equities – the majority of the pool – and have been the marginal trade for a decade. They were supposed to be passive, just along for the ride, but it appears they have hijacked the clearing price mechanism.  If the clearing price mechanism of the marketplace is broken, how does one know what the fair or natural price is, what the ‘market price’ is?

==================

 

A Window into the Value of the Industrial Strength Trading Liquidity of Mega-Cap Companies

Microsoft is in 212 different ETFs.  This small sample might shed some light on why.  It’s in:

    • The Technology Select Sector SPDR Fd, as a 20.2% position.
    • Vanguard Growth ETF, 9.3%
    • JP Morgan US Value Factor ETF, 2.3%
    • iShares USA Momentum Factor, 5.4%
    • iShares Minimum Volatility USA, 6.1%
    • Invesco Dividend Achievers ETF, 4.5%

So, Microsoft is simultaneously a growth stock and a value stock.  It’s both a momentum stock and a low volatility stock. It’s also a dividend stock and, of course, a technology stock. The point is, there is an insufficient population of super large companies to go around.  If one of them really has industrial strength trading liquidity, and if a fund organizer is starting a new ETF, it will be shoehorned into that ETF if they can possibly swing it. 

Here are a few more Microsoft ETFs:

  • iShares USA ESG Select ETF (Environmental, Social, Governance), 5.5%
  • US Vegan Climate ETF, 5.3%
  • Impact YWCA Women’s Empowerment ETF, 5.4%

=================

 

ETF Truth in Labeling (or Flying Blind)

Someone who wanted diversified exposure to Spain would probably have bought the iShares Spain ETF (EWP), a popular asset allocation building block with $940 million of AUM.

Just two problems:

  1. The top 5 holdings account for over 50% of the ETF’s value, and the top 10 for over 70%.  So, it’s super concentrated, not diversified. Security-specific diversification is a basic tenet of passive investing, so that a disaster in any one or few stocks will not meaningfully harm the fund’s results. Rest assured, any active manager found to be that concentrated would immediately be dismissed by a consultant for taking excessive risk.  But an index can’t be dismissed; it merely represents ‘the market’, after all.
  2. These top 10 holdings get over 70% of their revenues from OUTSIDE of Spain!  Buy Spain, and get NOT Spain.

This is another reflection of the requirement by ETFs for large, liquid companies:  EWP can’t afford to traffic in modest-sized local companies that truly reflect the character of the local economy.  All but one of the top 10 are global multi-national companies. Buying Banco Santander is not so very different than buying Citibank in the U.S., and buying Amadeus, the airline reservation infrastructure system, is not so very different than buying Sabre in the U.S. 

Historical Risk

 

Compare & Contrast:  Indexed Bond Funds vs. a non-Index-Centric Bond Fund

Bond Market Bubble


 

iShares Invest. Grade Corporate Bond ETF (LQD)

BlackRock MuniHoldings Quality Fund (MUS)

Inception date

2002

1998

Assets

35 Billion

0.3 Billion

Yield to Maturity

2.6%

5.7%

Distribution Yield

2.6%

4.1%

Yield after Fed Taxes

2.0%

4.2%

Average Maturity

13 Years

25 Years

Average Bond Price

115

116

Credit Quality

 

 

AAA

2%

15%

AA

8%

36%

A

39%

30%

BBB

48%

14%

Leverage

0%

37%

Discount to NAV

0%

-9.0%

10 Year Annualized Return

5.93% (taxable)

5.97% (tax-exempt)

Closed End fund search tool: www.CEFconnect.com

Basically, the laws of supply and demand have never been healthier. If every institution determines to buy bonds through the index funds that traffic in the same large-tranche securities, they will be priced higher:  a 2% after-tax yield. If every institution ignores non-index-suitable bonds, even if in a fund format (but a non-standard format), they will be priced lower; in this case 4% after tax yield, plus the possibility of appreciation.

Footnotes:

[1] A History of Interest Rates, Sidney Homer, Rutgers University Press, New Brunswick, NJ. 1963.

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Today's Guest:  Steven Bregman

Steven Bregman - President, Co-Founder of Horizon Kinetics LLC

Steven is the President of Horizon Kinetics and is a co-founder of the Firm. He is a senior member of the Firm’s research team, a member of the Investment Committee and the Board, and supervises all research reports produced by the Firm. As one of the largest independent research firms, Horizon focuses on structurally inefficient market sectors, including domestic spin-offs, global spin-offs (The Spin-Off Report and Global Spin-Off Report), distressed debt (Contrarian Fixed Income) and short sale candidates (Devil’s Advocate), among others. Horizon Kinetics has also taken an interest in creating functionally improved indexes, such as the Spin-Off Indexes and the Wealth Indexes (which incorporate the owner-operator return variable). Steve is also the President and CFO of FRMO Corp., a publicly traded company with interests in Horizon Kinetics. He received a BA from Hunter College, and his CFA® Charter in 1989. Steve has authored a variety of papers, notably “Spin-offs Revisited: A Review of a Structural Pricing Anomaly” (1996) and “Equity Strategies and Inflation” (2012).

Steven's Online Presence:


Today's Panelists

Market Update – Our Panelists Opinions on Coronavirus, Supply Chain Disruptions and Oil Price Drop

Back by popular demand, Kirk Chisholm, Megan Gorman and Barbara Friedberg discuss a market update for today March 12, 2020.

Today we are discussing the coronavirus, the big oil price drop and the supply chain disruption… and most importantly, what to do with your portfolio now.

Listen to three experts tell you how to manage your investments during this market turmoil… And we do it without scaring you.

oil price drop

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Today’s Panelists