Well Balanced

MP019: Facts, Framework & Approach with Jason Ranallo

In times of market swings, it’s easy to feel like you’re being swept along by a wave of headlines and data points. At Vector Wealth, we believe that while facts, like market prices, are important, they only tell part of the story. Sound investment decisions come not just from knowing the facts, but from having a framework that gives those facts meaning and direction.

In our latest podcast episode, Facts, Framework & Approach, Jason Ranallo walks through the current state of the market and economy. Then we follow up with our views and perspective:

• 📉 This week markets brushed up against bear market territory, declining nearly 20% from February highs. We have seen some recovery since the low.
• 🧮The S&P 500 index whipsawed this week after on-again, off-again tariff talks were paused — though not without caveats.
• 📊 Unemployment is at 4.2% — up, but still within a historically normal range.
• 📉 The Fed Funds rate is holding steady at 4.33% after a series of cuts that started in September 2024 when the rate was 5.33%.
• 🛒 The inflation rate has cooled to 2.8%, down significantly from its 2022 peak and down slightly from its year-to-date average.

These key investment frameworks shape our approach:

1. Time Horizon – Time in the market is more effective than timing the market.
2. Real Returns – Wealth is built by outpacing inflation.
3. Diversification as a Discipline – Prepare for multiple outcomes & uncertainty.
4. Compounding of Growth Assets – Given time, returns effectively earn returns.

Two key tenets of our bucket-based approach include:

1. Planning for 2–3 years of assured income to avoid becoming a forced seller of long-term assets in a down market.
2. Staging growth assets for the long term to isolate the potential volatility of stocks into later buckets to position for compounding growth.

Our view is that by maintaining this diversified stance, clients will be better prepared for what comes next. As always, we’re here to help you make informed, confident decisions about your financial future.

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New to Vector? Schedule an introduction at vectorwealth.com/start

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vectorwealth.com/regulatory

All content discussed in our podcasts, videos, or related blog articles are for informational purposes and should not be construed as individualized financial advice.

Opinions expressed herein are solely those of Vector Wealth Management, our staff, and guests. Material presented is believed to be from reliable sources, however, we make no representations as to its accuracy or completeness. All information and ideas should be discussed directly and in detail with your financial advisor prior to implementation of a strategy or investment. This podcast and related content are not intended to render personalized investment advice, nor should it be viewed as an offer to buy or sell, or a solicitation of any offer to buy or sell the securities or strategies discussed.

Please note that neither Vector Wealth Management nor any of its agents give legal or tax advice. The firm is not engaged in the practice of law or accounting. Charts, graphs, and returns do not represent the performance of Vector Wealth Management or any of its advisory clients. Returns presented do not reflect the impact that advisory fees and other expenses would on the results. Different types of investments involve varying degrees of risk, and there can be no assurance that any specific investment, asset category, or strategy will be suitable or profitable for a client’s portfolio.

MP018: Consumer Sentiment and the Stock Market with Jason Ranallo

When people feel the worst about the economy, that’s often when markets perform their best. Strange, right? But this is one of the fascinating dynamics we see when we dig into consumer sentiment—a gauge of how people feel about the economy.

The March preliminary Consumer Sentiment Index slumped 7 points to a lower-than-expected reading of 57.9. This was the third consecutive decline, bringing sentiment to its lowest level since 2022. The sharp deterioration is historically consistent with a slowdown in economic growth, as consumers typically pull back on spending.

Historically, when consumer sentiment is at its lowest, the stock market tends to rally—often strongly—over the next 12 months. In fact, the average return for the stock market following sentiment troughs is just over 24%, compared to just 3.5% after sentiment peaks.

Why this disconnect?
While current concerns about inflation, layoffs, and geo-politics are valid, financial markets are forward-looking. Markets are not only reacting to today’s emotions—they’re also trying to price in tomorrow’s outcomes. Periods of extreme pessimism can signal opportunity for long-term investors.

In this video podcast, we explore how sentiment acts as a contrarian indicator and how investors can respond. Rather than predicting the bottom, we emphasize having a plan, a diversified investment approach, and the ability to take action.

Take aways:
• Consumer sentiment can be a contrarian indicator
• Markets are forward-looking.
• Intra-year market declines have averaged -14% (yet finished positive a favorable 75% of the time)

Worth noting past performance is no guarantee of future results. We zoom out for context and understanding. 

If this market update has got you thinking about someone you care about or your own financial plans—we’d love to hear from you. You can reach out to us directly or through our website to schedule a conversation.

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Information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. Investments involve risk and, unless otherwise stated, are not guaranteed. Be sure to first consult with a qualified financial adviser and/or tax professional before implementing any strategy discussed herein. Past performance is not indicative of future performance.

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For more, visit: Vectorwealth.com/regulatory

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MP017: Moderate Corrections are Part of the Investing Journey with Jason Ranallo

Stock market volatility has returned, driven in part by increased uncertainty. As of March 11th, the S&P 500 was down about 9.3% from its all-time high made in February. The largest tech-oriented companies, like those comprising the Magnificent 7, experienced an even steeper decline. While this can feel unnerving, it’s important to remember that five to 10 percent market declines are not unusual.

 

Over the past 100 years or so:

- A 5% market decline has occurred about 3.4 times per year (mild correction).

- A 10% market decline has occurred about 1.1 times per year (moderate correction).

- 100% of the time (present decline excluded, for now) declines have been overcome (new all-time high).

 

During this period of increased market volatility, diversification of investments has proved its value. While U.S. large-cap stocks, broadly, are down so far this year, international stocks, bonds, and commodities have been positive.

 

Why diversify: “No single investment or asset class should determine the success of your financial future.”

 

Economy: Estimates of activity as measured by real GDP, were recently revised down. Importantly, this revision was primarily driven by a surge in imports ahead of potential tariff implementation. In short, economic activity is uneven given that people and businesses were front running the tariffs. Despite the concerns and revisions, other key economic indicators remain stable. Unemployment is low, household debt, while increasing, is still manageable, and credit conditions are supporting demand. This data can change, however at this time, there is not yet evidence of a broader economic slowdown or recession.

 

We know that market volatility can feel unsettling. Uncertainty, however, has always been part of investing, and these mild and moderate corrections, while uniquely challenging, have historically been overcome.

 

Our Approach: Maintain a disciplined strategy built on asset and time diversification, an ability to take action, and thoughtful planning.

 

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Information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. Investments involve risk and, unless otherwise stated, are not guaranteed. Be sure to first consult with a qualified financial adviser and/or tax professional before implementing any strategy discussed herein. Past performance is not indicative of future performance.

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Vectorwealth.com/regulatory

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FYR022: Protect Your Partner’s Financial Future. Why Every Couple Needs a Plan for the Surviving Spouse with Mike Nesheim.

In this podcast episode, senior wealth advisor Mike Nesheim discusses the importance of financial planning for surviving spouses. We explore the role of financial advisors in guiding families through the complexities of asset management, distribution strategies, and legacy planning.

The conversation emphasizes the need for open communication between spouses about financial goals and the necessity of involving family members in the planning process. We also highlight the significance of proper beneficiary setup and the use of tools like Vector’s Sojourn to provide clarity and confidence in financial decisions.

Takeaways: Surviving Spouse & Financial Planning

• Open communication about finances is crucial between spouses.
• Beneficiary setup is key to avoid probate issues.
• Involving family in financial discussions can ease transitions.
• Asset staging helps in managing distributions effectively.
• Understanding tax implications is important for financial strategies.
• Regular reviews of estate plans are necessary.
• Advisors should act as CFOs to their clients' financial decisions.
• Planning for a post-passing legacy ensures a smooth transition of assets.

Chapters:

• 00:00 Introduction and Overview
• 00:39 Personal Catch Up
• 01:39 Financial Planning for Surviving Spouses
• 04:49 Importance of Communication
• 06:16 Involving Family in Financial Discussions
• 08:39 Asset Distribution and Tax Strategies
• 11:47 Preparing for Financial Planning Meetings
• 13:43 Final Thoughts
• 14:01 Regulatory

Regulatory information at: vectorwealth.com/regulatory

Information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. Investments involve risk and, unless otherwise stated, are not guaranteed. Be sure to first consult with a qualified financial adviser and/or tax professional before implementing any strategy discussed herein. Past performance is not indicative of future performance.

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MP016: Tariffs, Economic Activity & The Super Bowl with Jason Ranallo

You might wonder—do tariffs or the Super Bowl cause inflation? Locally, and in the short term, yes. This week, two seemingly unrelated events—proposed tariffs and the Super Bowl—offer us a chance to dig into consumer behavior in the face of potentially rapidly changing pricing.

Tariffs can drive up prices on goods which increases costs for consumers and businesses. Tariffs, broadly, act like a tax—they create friction in trade, making it harder for businesses to operate efficiently. Think supply chain disruptions, re-tooling of manufacturing, and changing workforce dynamics. Similarly, the Super Bowl creates a localized economic surge, with host cities seeing higher hotel rates, packed restaurants, and a surge in demand for ride shares.

In our view, neither tariffs nor the Super Bowl generate new money—they simply redistribute existing economic resources. Tariffs can shift economic activity from importers to domestic producers.

This week, fans will shift their entertainment dollars toward football and the big game’s necessary accouterments. After the Super Bowl, however, New Orleans, the host city, will clean up, fans will travel home, and the local economy will trend to average. The $3,500 ticket, hotel stay, and meals out attending Super Bowl weekend are dollars not spent on a new car or a vacation to Cancun.

Tariff Takeaways for Investors

• We believe at this point the risks to US economic growth from tariffs are low.
• Presidents can implement tariffs easily, just as they can reverse course.
• Diversification is still one of the best tools to manage uncertainty.

Get Started - Schedule Intro Call: https://www.vectorwealth.com/start 

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Regulatory: https://www.vectorwealth.com/regulatory

All content discussed in our podcasts, videos, or related blog articles are for informational purposes and should not be construed as individualized financial advice.

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MP015: Why Markets Move: The Power of Shifting Expectations with Jason Ranallo

This week’s Market Perspective explores the significant influence of future expectations on economic activity. We illustrate the point through a few examples: Nvidia's stock volatility, the Federal Reserve's interest rate decisions, and the impact of social media on tourism. The discussion emphasizes how new information can shift economic value and consumer behavior, highlighting the dynamic and interconnected nature of markets.

Key Insights

1. Stock prices (like Nvidia's) reflect a volatility driven by market expectations.
2. Expectations can swing back just as easily as they surge.
3. New information can instantly alter economic value.

At the heart of our three stories lies a fundamental truth: markets, economies, and behaviors are inherently unpredictable. Just as Nvidia’s stock price can swing dramatically based on shifting investor sentiment, the Federal Reserve’s policy decisions hinge on ever-evolving economic data, and a single social media post can turn a quiet ski resort into a crowded hotspot overnight.

While we analyze trends and make informed predictions, the future remains unknowable. Forward expectations drive markets, but they can reverse just as quickly as they form. This unpredictability is not a flaw—it’s the essence of dynamic systems, where new information continuously reshapes value, perception, and behavior.

The best way, in our view, to navigate the inevitable twists and turns ahead is recognize that uncertainty is constant. The economic landscape isn’t just shaped by what’s happening now—it’s defined by what people expect to happen next. And when expectations shift, so does everything else. The takeaway: Those who remain steady amid uncertainty, adjusting without overreacting, we believe, are the ones who often come out ahead in the long run.

FYR021: Sharp Edges and Smooth Runs with Charlie Gruys

In this episode we discuss the importance of regular maintenance in both skiing and financial planning, emphasizing how proactive measures can prevent larger issues down the trail. Vector advisor Charlie Gruys shares insights from his experience as a youth ski coach, detailing the process of tuning skis and dialing DINs. The conversation also covers common financial to-dos, the significance of regular budget reviews, and the need for portfolio rebalancing. Ultimately, we cover the importance of mindset and resilience in both skiing and financial planning, encouraging listeners to act on the deferred maintenance in their lives.

About Charlie

Charlie is a wealth advisor at Vector and works directly with clients to support their financial planning and portfolio management. He has been involved in coaching youth downhill skiing at Hyland Hills since 2012. When he is not sharping ski edges in January or serving Vector’s clients, you can find him with his wife and four kids enjoying lake life. Ski tuning or wealth management needs? Charlie is here to help.

Takeaways

1. Regular maintenance can lead to optimal performance
2. Choosing the right types of accounts is important when considering saving and investing strategies
3. Regular budget reviews help maintain financial health
4. Portfolio rebalancing is a way to respond to changes in the weight of your portfolio allocations
5. Mindset and resilience are key in both skiing and your financial life
6. Reflect on your own deferred maintenance tasks

Chapters

• 00:00 Introduction to Skiing and Maintenance
• 02:45 The Importance of Ski Tuning
• 04:41 Ski Safety and Equipment Checks
• 07:10 Financial Analogies in Ski Maintenance
• 09:55 Deferred Maintenance in Financial Planning
• 11:51 Beneficiary Considerations
• 13:10 Regular Budget Reviews
• 15:53 Portfolio Maintenance and Rebalancing
• 18:05 Mindset and Resilience in Skiing
• 19:01 Conclusion and Call to Action
• 20:15 Regulatory
• 20:15 Good Job Benny!!

We’d love to hear your stories of deferred maintenance. What have you finally crossed off your list? Let us know!

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All content discussed in our podcasts, videos, or related blog articles are for informational purposes and should not be construed as individualized financial advice.

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MP014: 2025 Market and Economic Outlook with Kara Murphy

Jason Ranallo and Kara Murphy discuss the economic and market outlook for the upcoming year. They explore various themes including market trends, the impact of U.S. debt, the performance of the Magnificent Seven stocks, and the influence of AI on productivity. The conversation also covers mergers and acquisitions, real estate investment considerations, and the effects of political administration on market dynamics. The session concludes with insights on planning for future investments and the importance of diversification.

Originally recorded and streamed on January 14^th, 2025.

Takeaways

• The best-selling Barbie was Totally Hair Barbie, illustrating market surprises.
• Chewbacca Barbie is the most valuable today, showing how perceived value can differ.
• S. large cap stocks had a strong return of 25% last year.
• Don't fight the Fed; monetary policy significantly impacts stock performance.
• The Magnificent Seven stocks have shown extraordinary performance, but earnings growth is crucial.
• Diversification is essential to mitigate some risks in investing.
• S. debt is a growing concern, requiring a mix of solutions.
• AI has the potential to boost productivity but may not benefit all workers equally.

Chapters

The following chapter titles and start times are provide for those wanting to quickly jump to sections of interest.

 

00:00

Introduction and Overview of Vector Wealth Management

 

01:16

Investing and Barbie

 

04:41

Looking Back: 2024 Returns

 

05:28

The Economic Dashboard

 

06:38

The Magnificent 7: Driving Performance

 

09:40

Mag 7 vs. S&P 500, Among Others

 

11:27

Zooming Out - 200 Years

 

12:24

Jason & Kara Discussion & Market Perspective

 

14:33

Q&A Section

 

14:43

Q&A: U.S. debt as a percentage of GDP

 

16:53

Q&A: Owning assets that outpace inflation

 

17:35

Q&A: Public debt as a percent of the economy

 

18:51

Q&A: M2, The money supply.

 

19:48

Q&A: Productivity gains from AI

 

21:31

Q&A: U.S. workers left out of economic recovery

 

22:01

Mergers and Acquisitions: Current Trends

 

23:42

Real Estate and REITs: Investment Considerations

 

24:59

Q&A: Political Climate and Market Implications

 

26:51

Software & Semiconductors - Post Election

 

28:16

Bitcoin – Post Election

 

29:32

Q&A: IRA & Roth IRA

 

30:20

Q&A: 529 & Roth IRA

 

31:22

Q&A: Insurance, Fires in California

 

34:11

Q&A: Time Horizons & Asset Allocations

 

36:04

Contact Vector with Questions

 

36:28

Regulatory

 

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Kara Murphy is the Chief Investment Officer of Kestra Investment Management. She and her team collaborate with Bluespring/Kestra partner firms, including Vector Wealth Management.

 

Kara is a keynote speaker at industry conferences and a regular contributor to many television and radio programs, including CNBC, Bloomberg TV, and Bloomberg Radio. She is also regularly quoted in financial publications like the Wall Street Journal, New York Times, and Barron's. And to top it all off, Kara was recently named chief investment officer of the year in 2024's Women in Finance Awards*.

 

Hosted by Jason Ranallo, who serves as Chief Operating Officer and Director of Portfolio Management at Vector Wealth Management.

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All content discussed in our podcasts, videos, or related blog articles are for informational purposes and should not be construed as individualized financial advice.

Opinions expressed herein are solely those of Vector Wealth Management, our staff, and guests. Material presented is believed to be from reliable sources, however, we make no representations as to its accuracy or completeness. All information and ideas should be discussed directly and in detail with your financial advisor prior to implementation of a strategy or investment. This podcast and related content are not intended to render personalized investment advice, nor should it be viewed as an offer to buy or sell, or a solicitation of any offer to buy or sell the securities or strategies discussed.

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Vectorwealth.com/regulatory

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