Our Perspective

We can finally put 2018 to bed. The two stock indexes we follow most closely were the Dow Jones Global Stock Market, down -12.3% (WSJ) and MSCI ACWI (all country world index) down -9.42% for the year, even writing it is frustrating. This was on top of over 90% of the 70 tracked investment assets classes finishing negative for the year (the worst in history). While our portfolios held up as they were designed (which our team is proud of), we are not in business to lose money and even well designed portfolios don’t “feel” successful when performance is down.

In this month's edition I want to reflect on and discuss the 10 lessons our firm learned from the 2008 Financial Crisis. Last week was the 10-year anniversary of Lehman Brothers declaring bankruptcy and the financial world changing forever; we must never forget these lessons we learned during that frightening time or we will be doomed to repeat history.

In this month’s edition we will review 5 Auctus Investment Principles that have stood the test of time and have been applicable over my 15 plus year investment career. Our team reflects on these lessons frequently, especially given the current state of the markets.

It has been an interesting first half of 2018. Over the last several weeks we have had many discussions with our clients regarding the markets, their portfolios, and our strategies. Tremendous earnings growth coupled with almost no price appreciation has provided some long-awaited opportunities. The earnings growth has allowed us to “grow into” last year’s relatively expensive market.

In this month’s commentary we wanted to take you through an example of a due diligence meeting to illustrate the incredible access and information that goes into the Auctus proprietary investment process. This process is what allows us to formulate QUALITATIVE information into our already rigorous QUANTITATIVE analysis. This additional information is what helps set our firm and our process apart from others. We take investment manager selection to another level.

You’ve probably heard us say that panic is not an investing strategy, but the media often takes the opposite view, as they urgently rush to report “breaking news” and add “markets in turmoil” specials after particularly volatile days. It must work to gain viewers, or they wouldn’t do it, but we typically suggest that investors would be better served by taking a step back, keeping emotions in check and maintaining discipline. Turn off your TV!