“What is your best idea right now?” This is a real question that somebody asked me when I was a couple of drinks in at a party. It threw me off guard. Capital markets were not at the forefront of my mind at the time. I was thinking more about if I should have a cocktail, a beer or a water for my next round.

Despite the situation, I instinctively went into my overall view of capital markets. I went over expectations regarding economic drivers, political drivers, market sentiment, and how all those things can impact categories of stocks moving forward. I gave a market forecast and the theme of how my managed portfolios are currently positioned. It wasn’t the worst answer, but it certainly wasn’t the best answer.

The best answer, and my best idea is to invest broadly in stocks for the long-term.  My expectation is that economic progress will continue to march forward, and that per capita standard of living will continue to rise, and that over the long-term stocks will continue to be the greatest investable reflection of this advancement/growth.  It is my expectation that stocks will continue to provide the greatest combination of return on investment and Liquidity over long-term periods compared with other asset classes. A diversified portfolio of stocks is my best long-term idea.

Lastly, “what’s your best idea right now” is a bad question. An investor asking that question is begging to be sold a product/hot tip/gimmick. There are 1,000s of salesmen out there that will sell you the greatest stock pick, insurance policy, annuity, hedge fund, etc. if that is what you are looking for. Good wealth management is about philosophy and process, not a silver bullet.

 – Wyatt Swartz

– 6/5/2018