Author Archives: Jeff Holland

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About Jeff Holland

Jeff Holland is the co-founder of Via Four Investments in Hindsdale, IL.
EMAIL: jeff.holland@viaiv.com
BIO: About Jeff
PHONE: 630-674-7226

Is Now a Good Time to Invest? Yes!
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Is Now a Good Time to Invest? Yes! | Jeff Holland

{3:00 minutes to read} Everyday, the stock market has an expected rate of return. This means that on the day that you invest, you have the potential to earn an expected rate of return. If you wait for that “perfect” time and hold off, you miss capitalizing on the market’s rates of returns. When it comes to investing, you’re either in or you’re out.

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Ensure that Your Portfolio Is a Winner: Diversify!
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Ensure that Your Portfolio Is a Winner: Diversify! | Jeff Holland

{1:30 minutes to read} According to Nobel Prize winner and economist Harry Markowitz,diversification is the only “free lunch” in economics. The smartest investors diversify—by doing so, you drastically minimize risk and the potential sabotage of your financial future. By diversifying your assets, you’ve ensured a “win.” The Kentucky Derby provides a fitting analogy; all the horses are great, but their prowess can vary from race to race, from year to year. By diversifying, you bet on all of the horses—and you always win! (And hopefully you will sell some of the winning “horses” and buy some of the losing ones knowing that they will be winners one day).

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Relax, the Year is Almost Over
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Relax, the Year is Almost Over | Jeff Holland

{1 minute to read} Enjoy the holiday season! The election is over. The year is almost over. Don’t think about your money. Let your money work for you. Markets are always priced to have a positive expected rate of return. The media and your neighbor or friend are always going to try to scare you or get you to do something. But you should follow the plan that you have in place. Election years are very stressful on both sides, and you may have been very passionate about your candidate. You may or may not like the president-elect, but the markets have already reacted to the presidential election and priced him into the market. You’ve been told to worry by the media for 11 months of the year about what’s going to happen. Now you should take the month off of worrying and let your plan and the markets work for you—and do this in the future, too. And let the markets work for you, not against you.

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Lessons from 2016 Election: Invest, Don’t Predict
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Lessons from 2016 Election: Invest, Don’t Predict | Jeff Holland

{2 minutes to read} People often base their investments on their emotions and their predictions. What I want people to realize is that when you’re investing properly, you’re not really making any predictions. You’re using data and empirical research that incorporates information from market participants globally. Predictions can seem very entertaining. They might even be fun, with a small stake of the money. But you only remember your correct predictions. Predictions can cause you to go off the rails and not achieve your financial goals. You should not base your portfolio on predictions. You want to succeed with your financial goals. And if you think you’re smart because you make an accurate prediction, remember you can also be wrong. As John Kenneth Galbraith said, “The only function of economic forecasting is to make astrology look respectable.”

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Expect Price Fluctuations
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Expect Price Fluctuations | Jeff Holland

{Read in 1:50 minutes} Price fluctuations are a normal part of investing. The stock market can go up any given year, but the price fluctuations within each day, week or month can go up or down. Long-term investors shouldn’t equate those granular ups and downs with overall risk in a portfolio. Risk is a permanent loss of capital. The volatility, or price fluctuations, come in unforeseen clusters. We would all like to be able to get out before the downturns, but it isn’t possible to systematically avoid downdrafts.   The better option is to focus on the investment goals rather than day-to-day price fluctuations, or the people who talk about them ( read talking heads).

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Trust Market Prices
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Trust Market Prices | Jeff Holland

Don’t let outside noise interfere with your long-term plan. The market effectively enables competition among many market participants who voluntarily agree to transact. This trading aggregates a vast amount of dispersed information and drives it into security prices. In 2015, 98.6 million trades a day took place in World Equity Trading and the dollar volume was $447.3 billion a day. (Source: World Federation of Exchanges) When was the last time you met anyone who has made their fortune from outguessing stock prices? I would guess you have never met someone like that. Perhaps you’ve met people who earn fees from buying public stocks, or maybe people who put together real estate funds, but the odds are that you’ve never met a person who said, “Yeah, I trade stocks all day and make millions a year.”

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Don’t Invest Based Upon the Financial Press
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Don’t Invest Based Upon the Financial Press | Jeff Holland

{Read in 1:30 minutes} While informative and knowledgeable, the financial press is backward-looking rather than forward-looking, which means it has no predictive value for the future. Journalists do a great job of describing what has already happened, but that’s known information, and as they say, hindsight is 20/20. Journalists can’t describe what will happen; it’s not their job to prognosticate the future. They make opinions about trends, but those opinions are not meaningful when it comes to managing portfolios.

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Ignore the Fed!
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Ignore the Fed!| Jeff Holland

{Read in 1:50 minutes} The federal government—”the Fed”—is interesting. It’s fun to talkabout, much like a sporting event or celebrity gossip or the latest health scare. And it is just as much the subject of daily headlines as those news items. Financial journalists love to report the Fed’s every financial movement, trying to make it relevant to investment. Some advisors play along, pretending they can predict markets based on the Fed, in hopes of attracting investors and motivating them to keep making transactions. Some say that the interest rates move and the Fed follows.

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The New Fiduciary Mandate: Business as Usual at Via Four
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The New Fiduciary Mandate: Business as Usual at Via Four| Jeff Holland

The United States Department of Labor (DOL) has set forth a new guideline, known as“401,” for investment houses. 401 will make it mandatory that their agents take a fiduciary role with all of their clients’ retirement accounts. The proposal, which is set to take effect in 2017, will require all investment advisers of individual retirement accounts (IRAs) and 401k’s to take on the the role of a fiduciary and disclose all of the investment fees including compensation to their investors. It will provide transparency.

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Surviving the Stock Market: Stay Ahead Of Your Emotions
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Surviving the Stock Market: Stay Ahead Of Your Emotions | Jeff Holland

{1:22 minutes to read} All stocks have to be owned by someone. Investors essentially have long-term ownership in the world’s businesses. Like any owners, they get paid last. But often, especially if they globally diversify their portfolio, they also get paid most. And, like any owners, they are often the first ones affected by revenue changes, which can be scary. Human emotions are the major driving force behind most short-term fluctuations in stock prices.

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Have You Rebalanced Your Portfolio Lately?
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Have You Rebalanced Your Portfolio Lately? | Jeff Holland

{2:30 minutes to read} Maintaining a healthy balance is important in many areas of life;you constantly monitor and make ongoing adjustments to your monthly finances, your health, etc. But did you know it’s just as important to maintain balance & consistency in your investment portfolio? This adjustment is called “rebalancing.” Some people call it “pruning.” Just as you might prune a tree, you also need to prune off some of the returns of a high-performing fund, then plant some more seeds in the ones that have done less well over the last year.

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Staying the Course: Recency Bias and International Diversification
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Staying the Course: Recency Bias and International Diversification | Jeff Holland

{1:40 minutes to read} Recency bias—the tendency to make predictions about the future based on the recent past—is often used in investing. The problem with recency bias is that trends change all the time. Nothing is certain in investing. Most investors want to be invested only in the “hot performers.” In the the 2000s, international markets were the hot performers. In more recent years, it’s been U.S. markets. Now, some people are questioning whether they should continue holding on to international securities.

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9 Ways to Ensure a Better Investing Experience
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9 Ways to Ensure a Better Investing Experience | Jeff Holland

{4:15 minutes to read} Most people who invest are caught up in chasing past returns, but investing is actually about having a belief system. Here are 9 tips to ensure you have a better investing experience based on science, not predictions.

  1. Embrace market pricing. The market is an effective information-processing machine. Millions of people buy and sell securities every day – $302 billion trade in world equity markets daily. The markets aggregate all known information.