All Posts By

Steve DeBoth

Feb 11

What Happens When You Catch the Tiger by the Tail?

By Blog
There’s more to responsible investing than just diversification.  Buying, holding, and rebalancing investments has certainly produced solid results over many investment periods, but by choosing a static allocation and never wavering from it, an investor is very beholden to the time period in which they are investing.  Consider that for the 25-year period from 1956 through 1981, an investor who was half in stocks and half in bonds, rebalancing religiously, earned an average of 6.1% per year, which was only 1.1% higher than inflation.  However, the investor who started investing in the exact same portfolio beginning right after that in…
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Sep 23

Risk Hides in Complacency

By Blog
We humans aren’t great at evaluating risk.  Take the person who habitually texts while driving.  We all know that’s a risk, but we have a way of rationalizing behavior like that.  Texting on a country road doesn’t carry the risk of texting in front of a school, and texting while driving alone doesn’t carry the risk of texting with children in the car, for example.  Our brains find ways to give us permission, and I’m sure the person texting with kids in the car WHILE driving through a school zone also finds a way to give themselves the permission to…
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Jun 24

Beware the Target-Date Fund Cookie Cutter

By Blog
It has been nearly six years since we published a Cadence Clips piece on target-date funds.  Since then, they have continued being implemented to the point that I cannot remember the last time I saw a client’s 401(k) investment choices where target-date funds were not offered.  Much has happened in six years, and despite COVID, war in Europe, continued political acrimony at home and abroad to name a few, the price of the S&P 500 has doubled since June 2019 when we published that target-date fund piece entitled, “It Pays to Know What Is Under the Hood with Target-Date Funds”. …
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Feb 12

Tax Math: Weirder Than Regular Math

By Blog
No one really looks forward to tax season, do they?  Many of us enjoy the end of winter and the beginning of spring, and when you think of it that way it’s pleasant enough.  As soon as you call it “tax season”, well, that doesn’t usually evoke the same emotions.  Call it spring, and you think of flowers and sunshine; call it “tax season”, and you think of forms, deadlines and checks to write. With the negative feelings “tax season” evokes, it’s no wonder that along with it comes some frequent misperceptions.  For example, how do you feel about paying…
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Nov 18

Ask Cadence: With all of the large forces out there now that affect us yet are out of our control, what can we do to stay grounded and positive?

By Blog
When you hold as many meetings each year as we advisors do, you can gain a perspective at times on the general mood out there.  After years of COVID protocols, inflation, and a seemingly ever worsening political climate, to name a few, it is understandable if you are one of those feeling a general sense of malaise right now.  We’re hearing about it on a very regular basis these days.  Though it may be difficult or impossible to take action that will affect the large forces that feel like they are moving against you, taking action on things you actually…
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Feb 13

Are the Magnificent Seven Stocks a Blessing or a Curse?

By Blog
A feature of late-stage bull markets is the dominance of large cap companies.  Coming out of recessions, small companies are seen to be more nimble, able to take faster advantage of the conditions present after the excesses of the economy have been painfully cleared.  Before too long mid-sized companies start to come into their own, and then finally large companies start to swing around, like oil tankers making a big turn.  The advantage being nimble has eventually gives way in a maturing economy to sheer scale – big companies tend to dominate later stages of the economic cycle, with the…
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Jan 17

Winning on the Downside

By Blog
In the earliest days of the United States, tender and weakened from the 7 years of fighting to free itself from England, the debts acquired to fund the Revolutionary War had piled up with only troublesome methods of repayment left as options.  Many who supported independence from England did so because they did not like paying the taxes England had levied, so raising money through taxes was not an attractive option for the newly minted Treasury.  Issuing currency to pay those debts was also tricky, as with a mostly barter economy back then, any kind of liquidity injected into the…
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Oct 17

Big Changes to the Federal Student Aid Process Starting this Fall

By Blog
In order for returning college students or incoming senior high school students to be eligible to receive federal financial aid, like Pell Grants, they need to complete the Free Application for Federal Student Aid (FAFSA®) by the fall of the year BEFORE they are to attend college.  So, for anyone intending to attend college in the fall of 2024, they need to fill out a FAFSA form in 2023.  Normally, the soonest the forms can be accessed is October 1st of every year, but this year will see significant changes to the FAFSA forms and the access to those forms…
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Apr 13

How Are Your Cash and Securities Protected When Banks Fail?

By Blog
We have any number of risks to manage in our lives. When it comes to our financial well-being, few risks make us feel as nervous as a banking crisis. In 2008 it was revealed that many financial institutions owned worthless mortgage-backed securities, which sent financial markets around the world into a tailspin. Historically, however, most bank failures were caused by good old fashioned, “It’s a Wonderful Life” style runs on the bank. What makes bank runs scary is that we all know the bank doesn’t have all of our money on hand, as they’ve loaned as much as they can…
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Jan 11

2022 Asset Class Returns: Year in Review

By Blog
Toward the end of last year’s “Year in Review” piece I wrote: “You may be in the camp of investors that sees a year like this year as an opportunity lost as opposed to a sign that we have entered dangerous stock market times.”  2021 was one of those years where the US stock market outperformed most other investment categories by enough that it may have been easy for investors to assume there was less risk in the market than there really was at the end of last year. Unfortunately, to many investors’ surprise, 2022 came along and proved that,…
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