WEALTH MANAGEMENT
Derek Moore Founder and president Razor Wealth Management // razorwealth.com
Moore is a financial advisor, author and adjunct professor of finance and economics. He is the founder and president of Razor Wealth Management. Moore’s book, “Broken Pie Chart,” demonstrates why traditional portfolio asset allocation may be less optimal over the next decade while outlining a new approach to withstand modern day challenges, especially since the 2008 financial crisis. Trend to watch: “In June of 2019, provided no new developments, the economy would tie the record for longest period without a recession. I expect to see more predictions trying to pick when the next recession or market correction may come. All of that can cause fear and apprehension for investors. It may be time to start looking beyond the classical asset allocations such as the typical 60 percent/40 percent stock and bond portfolios. Instead, using alternative strategies that have the goal of capturing upside market moves while having embedded downside hedges or buffers, may offer better risk-adjusted returns should markets come under pressure while reducing anxiety for investors.” Advice for 2019: “After a 36-year bull market in bonds, investors are experiencing little real return in fixed income yields above inflation. If interest rates were to move materially higher, bond funds would come under pressure. This new period for interest rates may cause some challenges. At the same time, future retirees may need more growth than they think, especially considering how healthcare costs continue to rise. Life expectancies also are increasing. Moving forward we may see a larger focus on growth of assets required, given increasing costs in retirement and the reality that wealth may need to last for much longer post retirement. Based on these types of observations, more interest in alternative approaches will be sought after.”
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AB | November-December 2018