The Power of Small, Quiet Acts


Today, let’s pause and take a moment to reflect on the wondrous powers of small, quiet acts.

Pandemic aside, there have been plenty of great, big year-end reviews and year-ahead teasers, clamoring for your current attention. Describing 2020 as an “everything rally,” One Wall Street Journal columnist wrote, “Investors ended one of Wall Street’s wildest years on record by piling into everything from bitcoin to emerging markets, raising expectations that a powerful economic comeback will fuel even more gains.”

The excitement is not entirely unfounded. Last March, when the S&P 500 dove into a bear market almost overnight, it was hard to expect anything but a long, grim year ahead. Of course, in hindsight, we now know markets rebounded nearly as quickly as they plummeted. They ultimately delivered strong annual returns across most domestic and international asset classes. The fourth quarter was no exception to this tale of remarkable resilience.

Why would markets soar during still-sour economies? We could describe any number of rational reasons near-term market pricing mechanisms are continuing to operate exactly as expected … which is to say, according to anyone’s next lucky guess.

Unfortunately, that hasn’t stopped hordes of hopefuls from trying to score big on the latest tricks of the trade. From the adventures of Robinhood, to record-busting bitcoins, to blank-check SPACs, rising markets often tempt the uninitiated with enticing offers to earn “easy” money.

Whether the temptation is to abandon a free-falling market (like the one we encountered less than a year ago) or chase after winning streaks, an investor’s best move remains the same. Concentrated bets on hot hands generate wildly unpredictable outcomes, making them far closer to being dicey gambles than sturdy investments.

Trust, instead, in the durability of your carefully planned investment portfolio. Focus instead on small, quiet acts. That’s what we’re here for, for example, to:

  • Remind you that your globally diversified portfolio already holds an appropriate allocation to Tesla stock (which may be a lot, a little, or none, depending on your financial goals).
  • Guide you in rebalancing your portfolio if recent gains have overexposed it to market risks.
  • Help you interpret the 5,600 pages of the newly passed Consolidated Appropriations Act, 2021, so you can manage your next financial moves accordingly.
  • Assess potential ramifications of the Biden tax proposals, and advise you on any additional defensive tax planning that may be warranted for you in the years ahead.
  • Remain by your side as you encounter whatever other challenges and opportunities 2021 has in store for you and your family.

These aren’t loud acts you’ll read about in the paper, but they’re the stuff financial dreams are made of. How else can we help you achieve your personal financial goals, come what may in the headline news? Tell us more. We’re here to hear you. In the meantime, we wish you and yours a healthy and prosperous 2021.

Past performance does not guarantee future results. All investments include risk and have the potential for loss as well as gain.

Data sources for returns and standard statistical data are provided by the sources referenced and are based on data obtained from recognized statistical services or other sources we believe to be reliable. However, some or all information has not been verified prior to the analysis, and we do not make any representations as to its accuracy or completeness. Any analysis nonfactual in nature constitutes only current opinions, which are subject to change. Benchmarks or indices are included for information purposes  only  to  reflect  the  current  market  environment;  no  index  is  a directly  tradable investment.  There  may  be  instances  when  consultant  opinions  regarding any fundamental or quantitative analysis do not agree.

The  commentary  contained  herein  has  been  compiled  by  W.  Reid Culp,  III  from  sources  provided  by  TAGStone  Capital,  as well  as  commentary  provided  by  Mr.  Culp,  personally,  and  information independently  obtained  by  Mr.  Culp.  The  pronoun  “we,”  as  used  herein,  references collectively the sources noted above.

TAGStone Capital, Inc. provides this update to convey general information about market conditions and not for the purpose of providing investment advice. Investment in any of the companies or sectors mentioned herein may not be appropriate for you. You should consult your advisor from TAGStone for investment advice regarding your own situation.