Mike Vlasic Posts

Investing Under the New Administration

One of the most frequent questions and areas of concern among today’s investors is how the new presidential administration will impact their investments. To be concise, if not a bit glib, it shouldn’t. On the surface that may sound counterintuitive, but when we drill down a bit deeper, it makes perfect sense. The reason is asset allocation. Read more.

 

 

 

 

 

 

Mike’s News Release: What I Would Tell the Next President

presidential-sealRead about the three key actions Mike recommends that will turn around our economy & create a more positive future. 

 

 

 

 

Family Office Generational Balancing

One of the most important issues for a family office is balancing the diverse, and sometime contradictory, needs of members from different generations. Young members typically have lower spending and higher growth needs. Mid-aged members likely have higher outlays of cash. Older members need the highest cash flow, but are less interested in growth. Careful planning and being mindful of fairness issues are critical.

 

Investing During Globalization Uncertainty

Brexit, the US Presidential election and other factors clearly demonstrate high levels of economic and policy uncertainty and anxiety, particularly related to the effects of globalization. While this is an incredibly complex topic, with no simple answers, investors can implement two important strategies to preserve capital: Intelligent and careful diversification; and overweighting US investments if you are a US-based taxable investor.

 

The Right Real Estate Investments

commercial-real-estateCommercial real estate offers excellent investment opportunities for individuals and family offices. While there are many classifications – A, B, C, etc. – there is no right or wrong type of real estate investment. It depends on the investment goals, who the investment is for, the timeframe, the available capital, risk tolerance and other asset allocation considerations.

 

 

Bill Gates Got it Right on Energy

This is a great article outlining Bill Gates’ thoughts on energy. Well worth the read. Read the McKinsey article.

 

 

 

Define Your Universe of Acceptable Outcomes

In investing, financial planning and in life, one of the biggest mistakes people make is failing to recognize and define their universe of acceptable outcomes, which is critical when making decisions and setting a course to travel. If we are cognizant of what is acceptable, we can make wiser decisions about the directions we go.

 

 

What You Don’t Know . . .

The vast majority of investors do not keep careful enough track of how they “really” are doing to know their actual success rate. It is human nature to remember the homeruns and big wins, while the strikeouts, losses and lackluster performances fade in the memory. Don’t we all want to be stars? But doing this can give an investor a false sense of success, when they are really performing below a target standard.

 

 

Terrorism & Investing – What’s the Impact?

Over the past few years, there has been an increasing concern about terrorism – particularly international terrorism – and how it affects our lives. Of course, these are very real considerations, and prudent, diligent actions should be taken to combat such attacks. However, it is very unlikely that terrorism, like most social issues, will have a significant long-term impact on investments and the large investor. Such influences seldom change the course of the financial world.

Long-Term Investor Risks

The biggest risks to retaining and growing wealth are over-concentration of assets in one or a few assets, over-spending, poor leveraging, tax liabilities, family/family office dynamics and bad decision-making. Focusing on these things will significantly improve an investor’s long-term outlook.

 

 

 

 

When to Involve the Next Generation in the Family Office

While each family office has its own characteristics, needs and idiosyncrasies, involving next generations at an early age offers real benefits. There are good activities for children as young as 12 or 13 that can begin to assimilate them into the family office and develop their skills and judgment related to increasingly complex and important issues. It would not be advisable to share sensitive financials and information with the next generation until they reach at least 18, but their involvement can still be quite substantive.

 

 

Beware of the Start-Up Bubble

Start-Up Bubble

There are serious indications that a new “start-up bubble” is forming – or may have already formed. The lures of high-publicity/high-valuation Internet start-ups like Uber ($50 billion), Airbnb ($24 billion) and Snapchat ($16 billion) are attracting serious investment money from sources that previously did not consider such ventures. A surprising and somewhat alarming effect is that some IPOs are launching below their pre-release valuations – a major departure from previous trends. Appearances are not always reality in the long term. Be careful.

Mike in the News!

Read Mike’s recent news release on investment liquidity, yield and risk.

Mike Vlasic

“Liquidity is more important than ever
to avoid trapping investors in negative situations.”

 

 

Mike Speaks At UNC

Mike recently spoke at the University of North Carolina Kenan-Flagler Business School. His topic was Family Office, and he referenced his own background and experiences to share his insights. He received excellent comments from his audience. Read more about Family Office.

Liquidity & Risk

The current investment environment leaves much to be desired for many – if not most – investors. Avoiding negative yields is, of course, desirable, but not at the cost of losing liquidity in many cases. Getting pinned down in marginal or even potentially negative investments could be a huge mistake. Read more in Mike’s article, Liquidity in a World of Unusual Risk.

Candy-Coating or Good Advice?

You may not like it, but the financial analysis and advice you need to hear may not be what you want to hear. That’s a strong statement, but it’s based on the assumption that you want to achieve long-term, sustainable success. Hitting the occasional investment homerun is fun, but over time, losses can more than compensate for the rare spectacular gain. The statistics prove it. There just are not that many homeruns out there, and they cannot be predicted. Again, in the long term we strongly prefer going for more modest, yet reasonable returns, while minimizing the losing investments to achieve ongoing, dependable growth and preservation of assets. Some say it’s not the most exciting way to invest, but who wouldn’t get excited by sustainable success?

Does History Repeat Itself?

Sure, at times, but does that mean that someone can predict how investments will behave based on historic data? The answer is a clear no. While this statement is contrary to what some (or many) would suggest, experience and study show that it is correct. If investments could be predicted based on history, success rates of financial advisors would be far higher. The fact is that investment performance is far too complex to predict. It is impacted by a virtually unlimited number of variables, many of which cannot be accurately forecast with even the most sophisticated models and computers. Of course historic data, experience and many other factors can be helpful, but the smart investor allows for the range of acceptable outcomes in designing an asset allocation.

Oil Prices – What is Good?

Over the past several months, oil prices have dropped to the lowest levels in many months. Then they rebounded a bit, but they have recently dipped again. So are lower or higher prices good? An argument could be made that both are good and bad, depending on who you ask. For example, consumers likely prefer low prices for obvious reasons. But what about investors in oil and gas? Which is better for them? The answer is that it’s not that simple. The savvy investor manages their asset allocations and long-term investments to remain within an acceptable level of risk and volatility. That means considering both lower and higher gas prices within the big-picture investment strategy and allocation. So price fluctuations should simply be manageable, anticipated possibilities.

Are You Keeping Your NY Resolutions?

If you’re like a lot of people, you probably made one or more New Year’s Resolutions, but according to a Forbes article and the University of Scranton, nearly 40% of people make these annual resolutions, but only about 8% keep them. Here are some recommended investor resolutions worth keeping.

1) I will take a more effective approach to asset allocation by clearly understanding and stating the following:

  • For whom am I investing?
  • For how long am I investing?
  • For what am I investing?

2) I will assess how much risk I can tolerate and apply that limitation to my investments.

3) I will only make investments that produce potential results that fall within my set of stated acceptable outcomes.

Contact Mike for more information or assistance addressing these resolutions.

Is a Family Office Right for You?

A family office can provide a wide array of financial and administrative services to families with significant wealth. But it can also contribute to family harmony by improving communications, reducing conflict and getting everyone aligned with the same strategy. More

Direct Investing – A Hands-On Approach

A direct investment strategy significantly differs from many other approaches. There is a direct connection between an investor’s money and the business it finances. There are no third-party funds or manager in between. More.

Oversees Diversification Caution

U.S. investors don’t need to be as diversified globally as the models may say. You need to know what you’re doing if you focus on overseas investing.

A Play-to-Win Strategy

To achieve sustainable investment success, we go for a better average by hitting lots of singles and doubles instead of always swinging for the fences.

Sure, at times, but does that mean that someone can predict how investments will behave based on historic data? The answer is a clear no. While this statement is contrary to what some (or many) would suggest, experience and study show that it is correct. If investments could be predicted based on history, success rates of financial advisors would be far higher. The fact is that investment performance is far too complex to predict. It is impacted by a virtually unlimited number of variables, many of which cannot be accurately forecast with even the most sophisticated models and computers. Of course historic data, experience and many other factors can be helpful, but the smart investor allows for the range of acceptable outcomes in designing an asset allocation.Sure, at times, but does that mean that someone can predict how investments will behave based on historic data? The answer is a clear no. While this statement is contrary to what some (or many) would suggest, experience and study show that it is correct. If investments could be predicted based on history, success rates of financial advisors would be far higher. The fact is that investment performance is far too complex to predict. It is impacted by a virtually unlimited number of variables, many of which cannot be accurately forecast with even the most sophisticated models and computers. Of course historic data, experience and many other factors can be helpful, but the smart investor allows for the range of acceptable outcomes in designing an asset allocation.Sure, at times, but does that mean that someone can predict how investments will behave based on historic data? The answer is a clear no. While this statement is contrary to what some (or many) would suggest, experience and study show that it is correct. If investments could be predicted based on history, success rates of financial advisors would be far higher. The fact is that investment performance is far too complex to predict. It is impacted by a virtually unlimited number of variables, many of which cannot be accurately forecast with even the most sophisticated models and computers. Of course historic data, experience and many other factors can be helpful, but the smart investor allows for the range of acceptable outcomes in designing an asset allocation.