Manage Risk
"Risk comes from not knowing what you're doing." -Warren Buffet
Indexing is not risk management
Indexing has been touted as the safest way to invest, and has been adopted as the standard advice from almost every financial advisor in the business.Market Risk
If the market falls, you will either lose a significant amount of money, or a significant amount of opportunity in compounding time lost.
Liquidity Risk
In a crowded trade (the index trade), when panic hits, buyer disappear, causing a liquidity crisis, which creates a feedback loop of panic and crisis.
CONFLICT RISK
Paying an advisor 1% per year to index your investment is just moving money from one provider's pocket to the other, with no benefit to you.
How we think about risk
We know that there are ways to keep the average performance of the stock market while cutting risk to almost zero, and that's what we offer our clients. Most advisors neither understand nor use these techniques. The conventional wisdom of "buy and hold" doesn't offer the option of managing downside risk. Ours does.
Photos by Christofer Jeschke, Hunters Race, M.B.M., Alex Holyoake, Cytonn Photography, and Saffu