the common room
REBOUND BOUND
Buy low and sell high: It’s an investment maxim that even the non-financially savvy can understand. Maximum profits come when you buy stocks at low prices and then sell when their value has grown. Alex Navarro ’82 provides this advice in the context of international investments in the October 2013 issue of Bank Investment Consultant, a leading publication in the bank advising industry. Mr. Navarro is one of several financial advisors featured in the magazine’s cover story “Come On In, Overseas Is Fine,” that examines the decision to invest internationally. Mr. Navarro, who is a senior vice president and private financial advisor at SunTrust, counsels his clients to include international holdings in their portfolios. “In my opinion you can’t properly diversify without international investments,” he told Bank Investment Consultant. “At the end of the day we’re in the business of trying to achieve capital gains for our clients. And we can’t have blinders on when it comes to where to invest.” Mr. Navarro advises 300 households, whose portfolios usually hold 20-25 percent international stocks. For Mr. Navarro, communication is key in educating his clients on the rationale for the decisions he makes, quelling their concerns, and keeping them engaged in the investment process. According to Bank Investment Consultant, Mr. Navarro “produces his own research for clients, allowing him to steer the conversation to why he’s buying international options—rather than waiting for an anxious call from them first.” Because domestic markets have rebounded since the recession, while the global markets are still struggling, some clients may be confused as to why they should be investing in international markets—especially Europe. Mr. Navarro explains, “Yes, it’s ugly still, but a little less ugly. We think Europe is where we were four years ago. The ideal time to buy [US] stocks was on March 9, 2009, when AIG was in the toilet and Citibank was failing. But we feel it’s their turn and we want to participate in their recovery.” In short, buy international stocks while they’re low, with the payoff to come as the markets continue to rebound. Many advisors and strategists agree with Mr. Navarro. Investors shouldn’t be playing it safe with entirely domestic investments, they say; they need to position themselves for the future by having a diversified portfolio, including international options. Yet some clients continue to be resistant, and even the planning of a seasoned financial advisor such as Mr. Navarro, who has been working in the industry for over 40 years, can’t change their minds. Mr. Navarro tries to understand the reasons for their reactions, taking on the roles of “educator as well as psychiatrist,” but will ultimately position investors’ portfolios according to their wishes. And in lending his voice to Bank Investment Consultant, he is furthering the discussion of a complicated issue in today’s investment industry. ••
56
Spring 2014
’82 ALEX NAVARRO
financial advisor
By Anna Newman / Photograph by Rosh Ritchie