Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
Welcome to the hidden world of wealth, where secrets of
the affluent become accessible to you. You are listening to
Your Money Matters, the most provocative financial radio show on
the airwaves. You are about to start your educational journey
here on Your Money Matters with your host, Drew Prescott,
(00:22):
President of Prescott Private Wealth and Chartered Retirement Planning Counselor.
Drew will unlock the complexities of the financial landscape with straightforward,
powerful insights. Whether you're planning for retirement, managing in a state,
or looking to grow your wealth. Consider this your exclusive invitation.
Turn up the volume, lean in closer. Let's navigate the
(00:45):
hidden paths of prosperity together. Your financial enlightenment begins now.
Securities all produce a terror Financial Specialists LLC member fen
The SIPC reservices offered through Satara Investment Advisors LLC. SATA
firms are under separate ownership from any other named entity.
(01:06):
Four five to one THO sixth Street, Troy, New York,
one two one eight zero.
Speaker 2 (01:09):
Welcome back to Your Money Matters. I'm your host, Drew Prescott,
chartered retirement Planning counselor, a credited wealth management advisor as
well as president and wealth advisor here at Prescott Private Wealth,
located at four fifty one, who is extreet in Troy,
New York. The phone number here is five one eight
two zero three one nine eight three. The web address
(01:32):
is PRESCOTTPW dot com and feel free to email Drew
at prescottew dot com. And good morning to everybody. Welcome
to another episode of Your Money Matters. And before we
dive into the financial world, I want to kick things
off with some exciting sports news, because let's be honest,
nothing brings more excitement than a good game, and we've
(01:55):
really had plenty of them this past weekend. First off,
huge congratulations to LaSalle High School football team for pulling
off an incredible win against Troy High on Friday night.
And if you were there, you know it was really
a nail bier from start to finish, but LaSalle came
through when it mattered the most, and the energy in
the stadium was electric. You could really feel the intensity
(02:19):
between the two rivals. Both teams played their hearts out,
but LaSalle edged out Troy in a tight game that
had everyone on the edge of their seats. And you
can bet that a inner town rivalry really just had
the place buzzing. And it's exciting for lasal because they
have been up every half of every game so far
(02:40):
this year and they haven't been able to close it well,
but they did the other night. And nothing is better
than high school football to bring a community together. Right
And speaking of football, a little gloating here if you
wouldn't mind, but my Alabama football team beat Georgia Roll Tide.
(03:02):
We are back in first place. It really came in
this year as underdog, so it's been fantastic to see
our new coach Dover come in and really hold things together.
It's really a great thing to experience. And on the
baseball scene, hats off to all my friends and listeners
that are Mets fans. Exciting year for you. You got
(03:25):
through Milwaukee and they were a tough teams, so let's
see what you can, guys can pull off and hopefully
Diaz doesn't blow any saves for you guys. It's gonna
be a tough, tough playoff scene this year for sure.
And also, you know, I wanted to give my son
a little recognition. He does hardwood floors and does a
(03:49):
fantastic job and he redid our floors in our house
with my nephew and they did just such a great job.
If you want your hardwood floors refinished, feel free to
reach out to Parker five one eight two zero three.
I'm sorry, that's my phone number. Scratch that his is
(04:09):
five one eight seven two seven eight zero one eight
Again five one eight seven two seven eight zero one eight.
Leave him a message, Tell him I sent you, and
he'll take good care of you. You'll be very happy.
And now that we've covered local sports scene and a
little little home improvement, let's get down to business, okay,
And in today's show, we're going to cover the latest
(04:31):
updates in the financial markets. We'll talk about and what
investors should be paying attention to as we head into
the final quarter of the year, and then dive into
some tips on how to navigate investing in this ever
changing economic landscape. But before we do, I want to
remind all of our listeners that you're listening to your
(04:52):
Money Matters. It airs every Sunday at eleven am on
WGY eight ten am and one oh three one FM,
So whether you're tuning in from the car at home
or you're catching the podcast later on, we're here to
give you the tools and the insight that you need
to manage your finances and build the life that you deserve.
(05:14):
And hey, if you miss this episode, don't worry about it.
You can catch up on our website at PRESCOTTPW dot com.
All right, with all that said, let's jump into today's
financial news. We've got some interesting developments on Wall Street
and there are a few key reports coming out this
week that could really impact your portfolio. So stay tuned
(05:34):
and as always, feel free to call in or send
it your questions to us and we'll be sure to
get those on the air for you. And so let's
let's get moving along here and help you make sense
of all this. Okay, And by the way, one thing
that you want to know is that the week of
(05:55):
September thirtieth through October fourth was a mixed bag for
the US stock market, with significant economic events and geopolitical
concerns that influenced investor sentiment, and Wall Street's reaction was
somewhat tempered as major indices posted small gains or losses,
(06:18):
reflecting an ongoing caution due to the federal reserves, monetary
policy stance, the inflation data, and the mounting global uncertainty.
So let's dive into these key highlights from the week.
Will break down how specific stocks, sectors, and broader indices
performed and the economic forces driving these outcomes. So, as
(06:43):
you know, the three primary indices are the Dow Jones
Industrial Average, the S and P five hundred, and the
Nasdaq Composite, and they showed varied results during this period,
and investors digested economic reports that influenced market expectations for
the Federal Reserve's next move, particularly surrounding inflation and interest
(07:06):
rate policy. And with the Dow Jones Industrial Average, we
saw that the Dow was the strongest performer, climbing point
three percent, booying by strong showings from energy and consumer
discretionary stocks. Then we saw that the Dow Jones ended
above forty two three hundred, continuing its upward trajectory following
(07:32):
September's gain. Now twenty four of its thirty components closed
in positive territory. That's a great thing. Now, the SMP
five hundred, which is the broader SMP five hundred, slip
by point one percent, with the losses largely driven by
weak performance in the healthcare and technology sectors. Now this
(07:57):
slight dip brought the index to above fifty seven hundred,
ending the week on a cautious note, and for those
of you that pay attention to the tech heavy NASDAC
that fared worse. It declined zero point four percent, closing
out at just over eighteen thy one hundred, and this
(08:19):
decline was primarily driven by continued headwinds in the technology sector,
where growth stocks came under pressure due to regulatory concerns
in addition to slower than expected product demand. So one
of the dominant themes this week was speculation over the
(08:39):
Federal reserves next move, and the release of lower than
expected inflation data really buoyed hopes that the Fed may
be nearing the end of its tightening cycle, which would
be a positive signal for equities. By the way, and
inflation remained subdued, which calms the fears of additional aggressive
(09:00):
rate hikes, and many market participants are now expecting a
rate cut by the end of the year if inflation
continues to trend downwards. Now, lower interest rates are generally
seen as a positive for stock markets, particularly for sectors
like real estate, utilities and consumer discretionary where lower borrowing
(09:24):
costs can stimulate demands, and we've talked about that over
the last couple of weeks. However, the potential for rate
cuts creates mixed reactions across the financial sector. While lower
interest rates can boost consumer borrowing and spending, they also
lead to lower profit margins for banks and other financial
(09:47):
institutions which rely on these higher rates to increase lending profitability,
and as a result, the financial stocks were somewhat muted
this week. And geopolitical factors also played a critical role
in shaping the market landscape. So the war in Ukraine,
(10:09):
if you're paying attention, that intensified, leading to heightened concerns
over global energy supplies, particularly oil and natural gas. So
the energy sector was one of the standout performers with
oil prices surging on fears of supply disruption. We also
saw rising energy prices tend to benefit oil companies, and
(10:33):
this week was no exception to that rule, and we
saw energy giants like Chevron and Exxon Mobile. They saw
significant stock price gains as the energy select sector rose
two percent and investors flocked to energy stocks as a
safe haven amid geopolitical uncertainty, and that reinforced the sector's
(10:57):
outperformance compared to the broader mark. Well, the rally in
oil prices is not only a reflection of supply risk,
but also a demand story as many of the countries
continue to experience a robust rebound in post pandemic economic activity.
We saw Chevron one of the top performing stocks in
(11:20):
the Dow Jones. They benefited from the rise in oil prices,
climbing two and a half percent over the week. Investors
are really bullish on companies diversified operations which span both
upstream exploration and production as well as downstream with refining
and marketing, so making this stock really well positioned to
(11:47):
capitalize on energy price volatility. Now, if you're one of
the people that likes to really follow Tesla, interesting this
week because despite facing some challenges, Tesla managed to post
games thanks to really the optimism around the electric vehicle market.
We saw demands for the evs continue to grow globally,
(12:09):
and Tesla's strong market presence and the production capacity put
it in favor and really just a favorable position, I
should say, to benefit from the transition to cleaner energy. Now, also,
if you're following Tesla, you probably saw that Elon Musk
(12:32):
had made a statement that they're going to be able
to start to have taxis out there, driverless taxis, and
if that goes well, he was saying that the average
Tesla owner could earn an additional thirty thousand dollars annually
simply by putting their Tesla to use. So pretty interesting,
(12:56):
you know, kind of George Jens Jetson type stuff here.
But also let's turn our attention to Meta. Meta had
a solid week, and that was really based upon optimism
that was surrounding its push into artificial intelligence in addition
to the broader metaverse strategy, and investors remain hopeful that
(13:18):
the company's long term investment in AI will bear fruit,
particularly as it monetizes its efforts within the social media platform,
and they see that continue to show promise. Now, those
companies did good, but some of the ones that didn't
fare so well last week was in Vidia, and after
(13:40):
a stellar run earlier this year, as everybody saw, even
if you lived under a rock, you heard about Nvidia
and you saw it, stock prices slide by about three
point two percent during this week. Now, the tech sector,
particularly companies involved in semiconductors and AI, they really faced
headwinds due to growing concerns about the regulatory oversight in
(14:03):
addition to supply chain constraints, and in Nvidia, a leader
in the AI chips, is highly exposed to potential regulatory
pressures not just here in the US, but also abroad.
Which brings me to another company that had its challenges
this week, which is Apple. And as you know, Apple
(14:26):
is a tech giant, and they've really faced challenges this
week because Apple stock fell really due to slower than
expected demand for the newest iPhone model, and the company
also continues to grapple with stiff competition from lower cost
smartphone makers, particularly in the international markets like China. And
(14:49):
if we go a little bit further to see how
everything went last week between the winners and the losers,
let's look at some sectors, okay, and the best performing
sectors over the week was really energy. The energy sector
emerged as a top performer this week, and that was
driven by rising oil prices as we talked about, in
addition to geopolitical tensions and the energy sector. XL is
(15:16):
a ticker symbol that I'm referencing here. It posted gains
of about two percent, reflecting investors' confidence in oil and
gas companies like the Chevrons that we spoke of exon Mobile.
Also oil service companies like Halliburton and Schlumberger. They also
performed well as higher prices spurred increased exploration in addition
(15:39):
to production activity. Now, if we look at consumer discretionary
with inflation showing signs of easing, consumer confidence in spending
really remained strong, particularly heading into the holiday shopping season,
which is a great thing. It's something we want to see.
(16:00):
And we saw companies with the consumer discretionary sectors such
as Amazon and Nike benefited from this optimism, with both
stocks posting gains. Now, Nike, we did see they had
to cancel their forward looking projections for investors because they've
got a new CEO. I think they wanted to just
(16:20):
kind of pump the brakes, not get into talking about
how they saw things through the lens of their old
CEO when they have a new skipper in the seat here,
and I think that he just wanted a little bit
of a breathing room and not to not to throw
numbers out there prematurely, because he's still kind of putting
(16:42):
his hands in the mix here to see exactly what
he's dealing with and what he can come up with. Now,
retailers are really expecting a strong finish to the year,
and it's boosted by pent up consumer demand and a
steady labor market. So we'll see if that tailwind helps
take them through the last quarter of the year here. Now,
(17:06):
some of the sectors that are really going to face
some headwinds is going to be technology, and we see
the tech sector really struggled with the technology sector ticker
symbol here is XLK and drop byo point nine percent. Now,
several tech companies, including Nvidia and Apple, really faced challenges
(17:28):
related to regulatory concerns and slower product demand. Additionally, we
saw a heightened scrutiny over data privacy and artificial intelligence regulation,
which created uncertainty for many of the tech giants and
that weighed on their stock prices. Now, outside of technology,
(17:51):
one of the other sectors that we're seeing some challenges
for here in the fourth quarter is going to be
healthcare and they had a tough week this week, and
as pharmaceutical companies in addition to healthcare providers, really continue
to deal with operational challenges, including the labor shortages in
(18:11):
addition to really the increased overall cost So the healthcare
sector ticker symbol xl V as in Victor fell by
zero point one percent, and that really reflected investors unease
over the potential regulatory changes in drug pricing, and that
(18:31):
could negatively impact profit margins for the larger pharmaceutic or
pharmaceutical companies. So something we're going to want to keep
an eye on here. Okay, Now, the tailwinds that could
have a positive market catalyst for us here is going
to be the lower inflation and the potential rate cuts. Now,
(18:55):
one of the most significant advantages for the market moving
forward is the possibility of lower inflation continuing to drive
the expectations for a federal reserve rate cut. Now, remember,
if the Fed adopts more accommodative monetary policy, sectors like
(19:17):
real estate, utilities, and consumer discretionary could see significant gains,
and lower interest rates really reduce the borrowing costs, which
tend to stimulate consumer spending in addition to investments in
these sectors. So energy prices we're seeing with the geopolitical
(19:40):
tensions like Lee are going to continue to persist, particularly
in Ukraine, oil prices could remain elevated, providing continued support
for the energy sector. Now, the winter demand for energy
in Europe and North America is expected to keep oil
prices high, which are going to benefit companies involved in
(20:03):
oil exploration, production and the services. So that being said,
it could be a good opportunity for energy. Now, let's
take a peek at infrastructure spending. Now, the industrial sector,
it could experience a little bit of helpier as governments
(20:25):
around the world are continuing to ramp up infrastructure spending
and in the US initiatives related to rebuilding roads, bridges,
and renewable energy products. They're expected to benefit companies that
manufacture construction equipment in addition to the materials. And on
(20:47):
the flip side of this, some of the areas that
we're going to be facing really a headwind on are
going to be the geopolitical risks. Now, the geopolitical uncertainty,
particularly in Ukraine, remains one of the most significant risks
for global markets. Now. If the conflict escalates and the
supply chain disruption in the critical industries such as energy,
(21:11):
let's say, agriculture, even metals, right, that could negatively impact
a broad range of sectors. And the continued war in Ukraine,
in addition to Israel and going on in Iran and Lebanon.
I mean, that's kind of the tentacles are growing on that,
(21:36):
and we've got a lot of upheaval going on here
and these continued wars are really combined with rising tensions
here and it has the potential, let's just say that
it has the potential to create substantial volatility across global
markets and the tech sector, particularly the companies involved in
(22:02):
artificial intelligence, in addition to data privacy is likely going
to face increased regulatory scrutiny in the coming months. And
this isn't just locally, okay, so it's governments that are worldwide.
They're really stepping up their efforts to regulate AI, the
data usage and cybersecurity, which could impose additional costs and
(22:26):
really hinder the innovation in the sector. And the companies
that could be most impacted by this would be Apple, Google, Meta,
you know, even in Nvidia, as we spoke earlier as well,
and they're really likely to experience volatility as they adjust
to these new regulatory environments. And there's just a lot
(22:51):
going on inside of this AI world and the challenges
behind it. And also we're seeing the healthcare sector is
really facing some challenges as we talked about, But if
we look ahead, we're going to see that many investors
are really contemplating the idea of sector rotation and the
(23:15):
as the market conditions evolve here, so with the federal
Reserve potentially shifting to a more doubvish stance and geopolitical
risks remaining high, certain sectors are going to be more
likely to outperform than others. And here's some strategies that
investors may be considering. So some of them would be,
(23:40):
you know, focus on dividend paying stocks in the defensive
sectors here, because as interest rates begin to level off
or even decrease, investors may want to gravitate towards dividend
baying paying stocks in the defensive sectors like utilities, consumer staples,
(24:02):
and healthcare. Now, these sectors tend to be less volatile,
even though we just talked about healthcare having its challenges,
they tend to be less volatile during periods of economic uncertainty,
and they tend to provide a steady income stream through
the dividends, which can be very attractive to an income
(24:23):
focused investor. Now, investors with higher risk tolerance, they might
continue to focus on energy and industrial sectors which are
expected to benefit from the geopolitical tensions and increase government
spendings in infrastructure. While energy stocks in particular they offer
(24:47):
the potential for significant returns as the oil prices remain elevated,
so the industrial sector could also see gains from the
influx of government spending on infrastructure projects in addition to
renewable energy incentives. Now the caution out there would be
in technology and consumer discretionary so well, the tech stocks
(25:10):
have been really darling at the stock market for the years.
These regulatory challenges and slowing product demand that may cause
some investors to exercise caution when investing in technology sector. Additionally,
consumer discretionary stocks because they may face some new pressures
(25:31):
if inflation persists longer than expected or if consumer spending wanes,
particularly if there's a broader economic slowdown. So, in conclusion,
as we look ahead for the remainder of twenty twenty four,
investors are preparing for volatile fourth quarter, as they should. Okay,
(25:53):
the combination of our geopolitical tensions are regulatory pressures in
a day to uncertainty surrounding the federal reserve policy that's
going to continue to dominate the market sentiment. However, there
are still opportunities for investors willing to navigate these uncertain waters.
(26:15):
And again, energy and consumer discretionary really stands to benefit
from these tailwinds with these oil prices being the way
that they are and the robust consumer demand. So you know,
make sure that you, I guess investors should just really
(26:36):
remain vigilant, okay, and stay flexible in your strategy because
focusing on diversification and staying attuned to the macroeconomic developments
is going to benefit you. And as we approach the
end of the year, the most successful investors, they will
be the ones who can adapt to a changing landscape
(26:59):
while keeping a long term perspective. So keep that in
mind as we go towards the end of the year here. Okay, Now,
I always like to share stories with you. I find
for myself I learned better with stories, especially with a
topic that can be a little bit boring at times.
(27:23):
But let me share with you something that came up
on the golf course the other day. So it was
it was really just I don't know about you, but
a Friday ended up turning out to be just just
an incredible day and I was fortunate enough to get
out and play a little bit of golf, and I
(27:43):
was playing around with a fella and Tom. He's a
sharp guy, successful guy, works in the construction industry, and
he likes to dabble in investing on the side. And
we were we were on the bed and you know,
just like golf, I don't know about you. I may, hey,
(28:05):
maybe you're a scratch golfer, you're a plus handicap.
Speaker 1 (28:10):
Not me.
Speaker 2 (28:10):
Okay, you know I struggle at you know, twelve to thirteen.
I will say I'm getting a little bit better. I
feel like the last five rounds have really I've turned
a corner here. So we'll see. Maybe it's a fluke
and the wheels are gonna fall off the thing, and
or maybe maybe I've just turned the corner. We'll see.
But nonetheless, we were playing good round and.
Speaker 1 (28:34):
Well.
Speaker 2 (28:34):
As we were playing here, Tom said, so, Drew, Yeah,
I've been meaning to ask you something. You know, why
are you always saying that you're so against investing in
mutual funds? I mean, it seems like everybody has them
in their portfolio, So what's the big deal? And you know,
I've gotten this question a lot and I knew that
(28:55):
Tom was asking because he respected my opinion. Still, I
could also tell from his tone that he was really
a bit skeptical, and probably because mutual funds have been
presented to him and to most retail investors as a
convenient and a safe option for long term investing. So
(29:16):
I decided that I would lay it out for him.
And I knew that it wasn't going to be a
short answer, but you know, we had some time to kill.
We still had another ten holes ahead of us, and
the conversation was really kind of as smooth as our
golf game that day. So all right, here's what I said.
I said, all right, Tom, here's the thing about mutual funds.
(29:40):
They're not bad in principle. They were really designed for
a particular kind of investor, but they're not necessarily designed
to maximize the potential for people like you and me.
So let me break down why I do not recommend them,
at least not the way that they're structured today. So
(30:01):
before I got into the technical details, I wanted Tom
to understand where mutual funds came from and who they're
actually designed for. Because most people, they assume that mutual
funds are really a one size fits all solution, but
in reality, they were created for a specific type of investor,
(30:25):
someone who didn't have the knowledge, time, or interest in
managing their own portfolio, and they wanted a diversified really
just a hands off way to invest in the stock market. Well,
mutual funds were initially created for the average retail investor
(30:45):
who wants exposure to a broad range of stocks or
bond but doesn't want to deal with the hassle of
picking individual securities. I explained now, the idea was to
pull money from a large number of investors to create
a diversified portfolio that would be managed by a professional.
(31:05):
So on paper, that sounds great, doesn't it. But here's
where it starts to fall apart. And at that point
I could see Tom really kind of listening intently as
I drove home my point, and I said, these funds
weren't designed for people who are serious about precision in
their investing. They weren't created for people who want to
(31:27):
actively manage risk, make tactical moves, or control their portfolio
in a very detailed way. Instead, quite the opposite, Mutual
funds are a broad stroke solution, and they're made to
appeal to the masses. So I could see that, you know,
Tom was starting to get it, but I wasn't done yet,
(31:49):
because I continued on. I said, think about it. Mutual
funds are basically a basket of stocks or bonds, and
they're managed by a portfolio manager who decides when to
buy and sell individual securities. But you, the investor, you
do not have any control over what's inside of that basket.
(32:12):
And the manager could decide to overweight a sector that
you're really not comfortable with or to underweight one that's
performing well. And once you buy into that mutual fund,
really that's really it. Okay, you're stuck. You're stuck with
whatever decisions that that manager makes. And at this point
(32:32):
I could see that Tom was starting to see where
I was going with this, and I said, so, now,
you could say that that's fine because the managers are professionals, right,
But here's the issue. These managers there, they are not
investing for you personally. They're making a decision that's based
(32:55):
on a set of criteria that may or it may
not align with your individual goals. So you do not
have any say in what's getting bought or sold. And
that lack of precision can really cost you money over time.
So I went on to explain how mutual funds are
often too broad and slow to react to market changes,
(33:18):
and a mutual fund manager may hold on to losing
stocks longer than you personally would like, or they may
be restricted. Actually that's important to note. They may be
restricted by their internal guidelines from making tactical moves to
capitalize on opportunities. So I said, you see, you lose
(33:38):
the ability to be nimble, and in today's fast moving market,
that lack of precision can really hurt your returns. So
at this point Tom interrupted with it. He gave me
a fair question. He said, but aren't mutual funds supposed
to be diversified and low risk? I mean, isn't that
the entire point of them?
Speaker 1 (33:59):
You know?
Speaker 2 (33:59):
I nodded, but I was ready to dig in a
little bit deeper into these issues, and I said, you know, Tom,
I said, you're right that they provide diversification, but that
diversification comes at a price, and that price is not
just monetary, though. The fees are definitely something that we
need to talk about, and it's also about flexibility and control.
(34:24):
And I explained how mutual funds, especially actively managed ones,
They often come with hefty fees, and these fees can
significantly eat into an investor's return over time. And one
of the least expensive ways to buy mutual funds is
through a shares. I said, but even a shares come
(34:46):
with big commissions and upfront fees, So advisors who sell
these funds they get paid when you buy them, and
that can create a conflict of interest. And right after
I said that, I could tell that Tom was really
surprised by this. And I said, and if your advisor
wants to be tactical and move you between funds to
(35:09):
capitalize on the market opportunities, you can't really do that
efficiently and effectively with mutual funds because you're limited to
staying within the same fun family unless you want to
pay additional fees, which people should not do. Now, if
(35:30):
they move you into C shares, those come with an
even higher expense, which can further erode your returns. Now,
the only reason you would move to C shares is
so that you could use mutual funds in all these
stuff different fun families and hit different sectors. Okay, but
(35:53):
one thing to keep in mind, and I don't want
you to forget about this. Let's not forget about the
advisors who sell these funds. I added, The licensing requirements
to sell mutual funds are the easiest to obtain in
the financial services industry. All you need is a basic
(36:13):
license and a Series six and then you can sell
mutual funds and that's it. So the average advisor selling
mutual funds may not be very experienced at all when
it comes to actual investing. They're more like product salespeople,
is what I explained to them. And I could tell
that this was really a revelation for Tom because he
(36:34):
had always assumed that any financial advisor selling investments would
have a deep knowledge of the markets. Well, unfortunately, I
think that's the common on the common belief out there.
But it's unfortunate because that's often not the case. And
I'm a living testament to that because I started in
(36:54):
this industry with a Series six and had virtually absolutely
no training on investments. It was just product sales. It
wasn't until about two thousand and well, yeah, about two thousand,
maybe twenty thirteen, when I got my Series seven that
(37:14):
I really got passionate about understanding alpha, the beta sector
strengths and weaknesses, and how individual stocks and bonds and
ETFs are so much brings so much value to an
advisor's practice because they're able to carry that on with investors.
(37:39):
But let me get back to my story. Okay, So
now I said, let's talk about the myth of high
performing mutual funds. And I said, even the most impressive
mutual funds, the ones with stellar returns, they're often holding
the same stocks that you could buy individually. So let's
say that you had a mutual fund that's heavily invested
(38:02):
in Apple, Amazon, and Google. You could have just bought
those individual stocks yourself and probably done a lot better
without paying the extra management fees. And I pointed out
that while mutual funds really offer diversification, you're often better
off just owning the best performing stocks in the portfolio
(38:26):
directly because mutual fund managers are trying to beat the market.
But after you factor in fees, most of them don't.
You do better owning a concentrated portfolio in high quality
individual stocks. So at this time Tom seemed to be
nodding along with the idea, and I could tell that
(38:47):
he was really starting to understand the downside of mutual
funds compared to owning individual stocks or an exchange traded fund,
and I went on to explain to him that tax
efficiency is really one of the biggest drawbacks, and one
of the most important points that I wanted to drive
(39:10):
home was that tax inefficiency in mutual funds is something
to be aware of. And this is something that often
flies under the radar for most investors, but it can
have a huge impact on your long term returns. So
here's the thing, I said. Mutual funds are not as
(39:33):
tax efficient as ETFs or individual stocks. When a mutual
fund manager decides to sell a stock in a fund
that can trigger capital gains distributions, even if you didn't
personally sell any shares of the fund, you could still
be hit with a tax bill. And I explained how
(39:53):
mutual fund investors can end up paying taxes on gains
that they never realize simply because the man was forced
to sell shares simply to meet redemptions from other investors.
And that's not a good thing. And this happens a
lot during market corrections, I explained, because inexperienced or impatient
(40:16):
investors really will panic and they pull their money out
of a fund which forces a manager to sell stocks
to meet those redemption requirements. Now the remaining investors, like you,
you get stuck with that tax bill. Meanwhile, if you
owned those individual stocks yourself, you wouldn't have to sell
(40:38):
anything unless you wanted to, meaning that you could defer
your taxes for as long as you wanted. At that point,
Tom's eyes really kind of opened up and he said,
I had no idea that that could happen. Well, it's
one of the hidden draw down of mutual funds, I said,
And it's really one of the reasons why ETFs and
(41:00):
individual stocks are so much better for tax efficiency. So,
with all of this in mind, I wanted to show
Tom the alternative to mutual funds, using the individual stock
scenario and ETFs and a portfolio instead. And I said,
you know something, ETFs are a great option. They offer
(41:22):
the same diversification benefits as mutual funds, but without the
high fees and the tax in efficiencies. Plus they trade
like stock, and what that means is that you can
buy and sell them throughout the day, giving you more
control over the pricing of your portfolio. So I explained
how ETFs are generally much cheaper to own than mutual
(41:45):
funds because they have lower expense ratios. Now they also
tend to be more tax efficient since they don't have
to sell shares to meet redemptions the way that mutual
funds do. So I said, you know, if you need
an actively managed portfolio, whether it's for sector exposure or
(42:06):
broad market approach, it's better to work with an advisor
who uses individual stocks and ETFs because then you're going
to get the precision and the control that you want
and need with all of the downsides or what I
should say without without all of the downsides of the
mutual funds. So I also pointed out that the individual stocks,
(42:30):
you're not paying anyone to manage your portfolio. You're making
the decisions yourself or with an advisor's help, and that
gives you complete control over your tax situation and your
investment strategy. So stocks, ETFs, and bonds they're just more efficient,
I said, They're cheaper, they're more flexible, and they're better
(42:52):
for tax planning. Mutual funds, on the other hands, they're
designed for people who don't want to manage their money.
So if you're serious about investing, they're really just not
the right tool. For the job. And one last point
that I wanted to make was about the fees that
are associated with mutual funds. The least expensive way to
(43:16):
my mutual funds with an advisors through a shares, I said,
But even with a shares, like I said earlier, you're
looking at big upfront commissions and ongoing fees, and these
fees can really eat into your returns over time. I
explained how with a shares the commission can be as
(43:36):
high as five percent, which means that right off of
the bat, you're down five percent on the investment, and
that's really a tough hurdle to overcome, especially if the
fund underperformed. And if your advisor wants to make tactical moves,
they're limited in what they can do with mutual funds.
So I continued on. I said, if you want to switch,
(43:59):
if they want to switch you from one mutual fund
to another to capture opportunities in different sectors, you're stuck
within the same fun family unless you want to pay
more fees, and that lack of flexibility can really cost
you money. So he says, well why do I Why
(44:20):
would I want to go to another fun family? And
I explained nobody. No Fun Family does the best across
all sectors in the market. So you know, if you
want to for all all you Yankee fans out there,
I'm going to use the Yankees for a second. Okay.
(44:42):
So if you want the best first baseman, the best
second basement, best shortstop, third baseman, and all the different positions, okay,
you're not going to find those individuals inside of one
Fun Family. You would have to use all the different
Fun families, have them step up to the plate, and
then screen for what you're looking for. Now, to do
(45:05):
that with A shares, you're going to miss out on
what we call breakpoints, which becomes more expensive for investing.
So in order to do that, you would want to
use a C share or institutional shares along that level.
And with the C shares with someone that's not using
(45:26):
a fee based account, you have higher ongoing expenses compared
to A shares, And with C shares the fees are
so hot. They're really just so high that it's hard
to make any real money in the long run. So
if your advisor is trying to be tactical with your
portfolio and using C shares, you're going to end up
(45:48):
paying a lot in fees for a very little benefit.
The better approach is going to be working with a
knowledgeable advisor, and I can see the Tom was starting
to understand why wasn't a fan of mutual fund but
I wanted to make sure that he knew what to
look for in a better investment strategy, So I said, Tom,
(46:10):
here's the key. The key is to work with an
advisor who really knows what they're doing, someone who uses
individual stocks, bonds and ETFs to build your portfolio. Because
with those tools you can be much more precise in
your investment strategy, you can make tactical moves without paying
(46:34):
unnecessary fees, and you can manage your taxes much more efficiently,
which your accountant will really appreciate. And I finished by
reminding Tom that investing is not about following the crowd.
It's about finding the best strategy for your specific goals
(46:57):
and risk tolerance. Again, mutual funds are fine for some people,
I said, but for someone who wants more control, more
flexibility and lower costs, you would be better served using
individual stocks and ETFs because they are a far better option.
(47:20):
And so as we wrapped up our round of golf,
I could see that Tom was thinking about what I'd said.
You've definitely given me a lot to think about, Drew,
And at that point I replied with a smile. Investing
is all about making informed decisions. Tom. Mutual funds might
(47:41):
work for some people, but if you personally really want
to get the most out of your portfolio, well then
it's worth looking at other options. And with that said,
as we're heading back to the clubhouse, knowing that the
conversation that we just had, it might help Tom just
like him, take really a more thoughtful approach to their
(48:03):
investments in the future. So I share that story with
you because although mutual funds can serve a purpose for
certain investors, particularly seeking hands off diversification, however, for those
of you who want more control, precision, and tax efficiency,
(48:24):
they come with significant downsides. Higher fees, lack of flexibility,
and tax inefficiencies often make mutual funds less than ideal
choices for serious investors, and by focusing on individual stocks,
ETFs and bonds, you can create a more tailored, cost
(48:45):
effective investment strategy that aligns with your financial goals and
your risk tolerance. So always ensure that you're working with
a knowledgeable advisor who prioritizes your interests and employs investment
tools that maximize your potential for success. So one thing
(49:05):
to make sure that you take away from this is
Tom's last question. He said, Okay, I understand your take
on mutual funds, and I know that some people swear
by them, and obviously I understand where you're coming from.
It makes all the sense in the world to me.
(49:27):
So what should I do at this point? And I
said to him, Tom, listen, of course, I'd love to
work with you, Okay. I enjoy our time together and
I appreciate the fact that you're teachable. So that being said,
(49:50):
you know, I'm not somebody to handcuff somebody. I'm not
really a hard sell type of an individual. And I said,
before I answered this question, let's take a step back
and talk about why having a financial advisor, whether the's
Series seven licensed or a registered investment advisor representative, is
(50:13):
so important. You see, whether you're talking about mutual funds
or individual stocks, there's a common thread the need for
professional guidance. And I paused to let that sink in
for a moment before I continued. I said, you mentioned
(50:33):
that you've been buying stocks on your own and I
get that a lot of people like the idea of
being in control of their investments. But the real question
is are you making the best possible choices for your
long term goals? And that's where the role of an
advisor comes in, and it ties directly into mutual funds
(50:58):
why they may not be as beneficial as they seem.
So at this point, Tom was really listening intently, and
I began to explain to him really the difference and
why you want to work with a financial advisor that
(51:19):
is properly licensed and not have a go at it
yourself a DIY investment approach, because Series seven licensed financial
professionals or a registered investment advisor is not only important,
but it's crucial to deal with an individual like that
(51:42):
if you're serious about managing your wealth. Now we see
the rise of these online trading platforms and it has
made it easier than ever for people to invest in
stocks on their own with apps like Robin hood E
Trade Fidelity. Anyone with a smart trone a smartphone, I
should say smart throne, Oh my gosh. I don't know
(52:03):
about you, but sometimes I like to pay attention when
I talk because I don't know what I'm gonna come
up with, and that's one of them. But anyone with
a smartphone can become a trade or really in minutes.
And at first glance, you you know, you feel empowered.
There's no middleman, there's no fees, and you're in full
control over which you buy and sell. I mean, why
why is that not appealing to somebody? Right? You know,
(52:25):
we like to feel like we're the end to all
be all in different areas of our life. Unless you're
highly educated, and you know that the value of a professional.
So with that being said, seek out the proper counsel,
get the help that you're looking for because it will
(52:46):
be invaluable to you. So we're getting ready to wrap
up our show here. I've really I've enjoyed sharing this
time with you. Thank you so much for giving me
this part of your life. I realize this is this
is time of your life you're never gonn to get back,
so I want to make it valuable. If you're tuned
in here again, thank you so much. You're listening to
Drew Prescott, chartered Retirement Planning counselor, Accredited Wealth Management Advisor
(53:11):
and President and wealth Advisor at Prescott private wealth. This
is your money matters and it can be heard here
every Sunday at eleven am on WGY Radio eight ten
am one oh three to one FM. And I hope
you just have such a wonderful Sunday. And before we
come to a complete closure on the show, I wanted
(53:33):
to I wanted to throw this out there for you.
Last time I put a special out there for putting
together a financial plan, it was so well received, I
want to put it out there again. Okay, And so
let me explain why I'm so passionate about having a
(53:54):
financial plan. Would I do for a client when they
have a financial plan? Is this? Listen? A lot of
stuff happens out on the golf course. Let me tell
you so. I hate to use the golf course as
an example, but a lot of questions come up on
the golf course. I had a young man who's in
(54:15):
his forties, wildly successful in real estate and has very
little debt, and he has been approached by a fella
that is only licensed to sell life insurance. Great guy,
but he came at him with about three different ideas,
all using life insurance and poop poot investments. The entire
(54:39):
time now this individual is no longer licensed to sell investments,
so obviously he has a he's got an edge to
grind here because he only has one side on his sword. Now,
this guy, the young real estate will call him mogul, right. See,
(55:00):
he is doing such a great job. But he was
literally sick to his stomach because this fella was promoting
that he put several hundred thousand dollars into life insurance
each year in two different scenarios, and he didn't know
if he was doing the right thing. Now we're working
with this individual on a financial plan. We've got a
(55:21):
team of CPA's attorneys and advanced planning individuals that and
cfps that are working on his financial plan, and it
is wildly impressive in addition to incredibly beneficial for him
and his family. Now, I want to offer you the
ability to have the same type of tools available to you,
(55:46):
and I'm going to do a financial plan for fifteen
hundred dollars for you. Okay, it's fifteen hundred dollars. My
team will work on it, we'll deliver it to you.
You'll end up with a binder, a life binder that
as everything in place in the event that you were
to pass away and you need to hand it along
to your family, So reach out for that special again.
You're listening to your money Matters. I'm your host, Drew Prescott.
(56:10):
You can tune in every Sunday w g y A
ten and one O three one FM. Feel free to
call in five one eight two zero three one nine
eight three and have a beautiful Sunday and God bless
Welcome to the hidden world of wealth, where secrets of
the affluent become accessible to you. You are listening to
Your Money Matters, the most provocative financial radio show on
the airwaves. You are about to start your educational journey
here on Your Money Matters with your host, Drew Prescott,
(00:22):
President of Prescott Private Wealth and Chartered Retirement Planning Counselor.
Drew will unlock the complexities of the financial landscape with straightforward,
powerful insights. Whether you're planning for retirement, managing in a state,
or looking to grow your wealth. Consider this your exclusive invitation.
Turn up the volume, lean in closer. Let's navigate the
(00:45):
hidden paths of prosperity together. Your financial enlightenment begins now.
Securities all produce a terror Financial Specialists LLC member fen
The SIPC reservices offered through Satara Investment Advisors LLC. SATA
firms are under separate ownership from any other named entity.
(01:06):
Four five to one THO sixth Street, Troy, New York,
one two one eight zero.
Speaker 2 (01:09):
Welcome back to Your Money Matters. I'm your host, Drew Prescott,
chartered retirement Planning counselor, a credited wealth management advisor as
well as president and wealth advisor here at Prescott Private Wealth,
located at four fifty one, who is extreet in Troy,
New York. The phone number here is five one eight
two zero three one nine eight three. The web address
(01:32):
is PRESCOTTPW dot com and feel free to email Drew
at prescottew dot com. And good morning to everybody. Welcome
to another episode of Your Money Matters. And before we
dive into the financial world, I want to kick things
off with some exciting sports news, because let's be honest,
nothing brings more excitement than a good game, and we've
(01:55):
really had plenty of them this past weekend. First off,
huge congratulations to LaSalle High School football team for pulling
off an incredible win against Troy High on Friday night.
And if you were there, you know it was really
a nail bier from start to finish, but LaSalle came
through when it mattered the most, and the energy in
the stadium was electric. You could really feel the intensity
(02:19):
between the two rivals. Both teams played their hearts out,
but LaSalle edged out Troy in a tight game that
had everyone on the edge of their seats. And you
can bet that a inner town rivalry really just had
the place buzzing. And it's exciting for lasal because they
have been up every half of every game so far
(02:40):
this year and they haven't been able to close it well,
but they did the other night. And nothing is better
than high school football to bring a community together. Right
And speaking of football, a little gloating here if you
wouldn't mind, but my Alabama football team beat Georgia Roll Tide.
(03:02):
We are back in first place. It really came in
this year as underdog, so it's been fantastic to see
our new coach Dover come in and really hold things together.
It's really a great thing to experience. And on the
baseball scene, hats off to all my friends and listeners
that are Mets fans. Exciting year for you. You got
(03:25):
through Milwaukee and they were a tough teams, so let's
see what you can, guys can pull off and hopefully
Diaz doesn't blow any saves for you guys. It's gonna
be a tough, tough playoff scene this year for sure.
And also, you know, I wanted to give my son
a little recognition. He does hardwood floors and does a
(03:49):
fantastic job and he redid our floors in our house
with my nephew and they did just such a great job.
If you want your hardwood floors refinished, feel free to
reach out to Parker five one eight two zero three.
I'm sorry, that's my phone number. Scratch that his is
(04:09):
five one eight seven two seven eight zero one eight
Again five one eight seven two seven eight zero one eight.
Leave him a message, Tell him I sent you, and
he'll take good care of you. You'll be very happy.
And now that we've covered local sports scene and a
little little home improvement, let's get down to business, okay,
And in today's show, we're going to cover the latest
(04:31):
updates in the financial markets. We'll talk about and what
investors should be paying attention to as we head into
the final quarter of the year, and then dive into
some tips on how to navigate investing in this ever
changing economic landscape. But before we do, I want to
remind all of our listeners that you're listening to your
(04:52):
Money Matters. It airs every Sunday at eleven am on
WGY eight ten am and one oh three one FM,
So whether you're tuning in from the car at home
or you're catching the podcast later on, we're here to
give you the tools and the insight that you need
to manage your finances and build the life that you deserve.
(05:14):
And hey, if you miss this episode, don't worry about it.
You can catch up on our website at PRESCOTTPW dot com.
All right, with all that said, let's jump into today's
financial news. We've got some interesting developments on Wall Street
and there are a few key reports coming out this
week that could really impact your portfolio. So stay tuned
(05:34):
and as always, feel free to call in or send
it your questions to us and we'll be sure to
get those on the air for you. And so let's
let's get moving along here and help you make sense
of all this. Okay, And by the way, one thing
that you want to know is that the week of
(05:55):
September thirtieth through October fourth was a mixed bag for
the US stock market, with significant economic events and geopolitical
concerns that influenced investor sentiment, and Wall Street's reaction was
somewhat tempered as major indices posted small gains or losses,
(06:18):
reflecting an ongoing caution due to the federal reserves, monetary
policy stance, the inflation data, and the mounting global uncertainty.
So let's dive into these key highlights from the week.
Will break down how specific stocks, sectors, and broader indices
performed and the economic forces driving these outcomes. So, as
(06:43):
you know, the three primary indices are the Dow Jones
Industrial Average, the S and P five hundred, and the
Nasdaq Composite, and they showed varied results during this period,
and investors digested economic reports that influenced market expectations for
the Federal Reserve's next move, particularly surrounding inflation and interest
(07:06):
rate policy. And with the Dow Jones Industrial Average, we
saw that the Dow was the strongest performer, climbing point
three percent, booying by strong showings from energy and consumer
discretionary stocks. Then we saw that the Dow Jones ended
above forty two three hundred, continuing its upward trajectory following
(07:32):
September's gain. Now twenty four of its thirty components closed
in positive territory. That's a great thing. Now, the SMP
five hundred, which is the broader SMP five hundred, slip
by point one percent, with the losses largely driven by
weak performance in the healthcare and technology sectors. Now this
(07:57):
slight dip brought the index to above fifty seven hundred,
ending the week on a cautious note, and for those
of you that pay attention to the tech heavy NASDAC
that fared worse. It declined zero point four percent, closing
out at just over eighteen thy one hundred, and this
(08:19):
decline was primarily driven by continued headwinds in the technology sector,
where growth stocks came under pressure due to regulatory concerns
in addition to slower than expected product demand. So one
of the dominant themes this week was speculation over the
(08:39):
Federal reserves next move, and the release of lower than
expected inflation data really buoyed hopes that the Fed may
be nearing the end of its tightening cycle, which would
be a positive signal for equities. By the way, and
inflation remained subdued, which calms the fears of additional aggressive
(09:00):
rate hikes, and many market participants are now expecting a
rate cut by the end of the year if inflation
continues to trend downwards. Now, lower interest rates are generally
seen as a positive for stock markets, particularly for sectors
like real estate, utilities and consumer discretionary where lower borrowing
(09:24):
costs can stimulate demands, and we've talked about that over
the last couple of weeks. However, the potential for rate
cuts creates mixed reactions across the financial sector. While lower
interest rates can boost consumer borrowing and spending, they also
lead to lower profit margins for banks and other financial
(09:47):
institutions which rely on these higher rates to increase lending profitability,
and as a result, the financial stocks were somewhat muted
this week. And geopolitical factors also played a critical role
in shaping the market landscape. So the war in Ukraine,
(10:09):
if you're paying attention, that intensified, leading to heightened concerns
over global energy supplies, particularly oil and natural gas. So
the energy sector was one of the standout performers with
oil prices surging on fears of supply disruption. We also
saw rising energy prices tend to benefit oil companies, and
(10:33):
this week was no exception to that rule, and we
saw energy giants like Chevron and Exxon Mobile. They saw
significant stock price gains as the energy select sector rose
two percent and investors flocked to energy stocks as a
safe haven amid geopolitical uncertainty, and that reinforced the sector's
(10:57):
outperformance compared to the broader mark. Well, the rally in
oil prices is not only a reflection of supply risk,
but also a demand story as many of the countries
continue to experience a robust rebound in post pandemic economic activity.
We saw Chevron one of the top performing stocks in
(11:20):
the Dow Jones. They benefited from the rise in oil prices,
climbing two and a half percent over the week. Investors
are really bullish on companies diversified operations which span both
upstream exploration and production as well as downstream with refining
and marketing, so making this stock really well positioned to
(11:47):
capitalize on energy price volatility. Now, if you're one of
the people that likes to really follow Tesla, interesting this
week because despite facing some challenges, Tesla managed to post
games thanks to really the optimism around the electric vehicle market.
We saw demands for the evs continue to grow globally,
(12:09):
and Tesla's strong market presence and the production capacity put
it in favor and really just a favorable position, I
should say, to benefit from the transition to cleaner energy. Now, also,
if you're following Tesla, you probably saw that Elon Musk
(12:32):
had made a statement that they're going to be able
to start to have taxis out there, driverless taxis, and
if that goes well, he was saying that the average
Tesla owner could earn an additional thirty thousand dollars annually
simply by putting their Tesla to use. So pretty interesting,
(12:56):
you know, kind of George Jens Jetson type stuff here.
But also let's turn our attention to Meta. Meta had
a solid week, and that was really based upon optimism
that was surrounding its push into artificial intelligence in addition
to the broader metaverse strategy, and investors remain hopeful that
(13:18):
the company's long term investment in AI will bear fruit,
particularly as it monetizes its efforts within the social media platform,
and they see that continue to show promise. Now, those
companies did good, but some of the ones that didn't
fare so well last week was in Vidia, and after
(13:40):
a stellar run earlier this year, as everybody saw, even
if you lived under a rock, you heard about Nvidia
and you saw it, stock prices slide by about three
point two percent during this week. Now, the tech sector,
particularly companies involved in semiconductors and AI, they really faced
headwinds due to growing concerns about the regulatory oversight in
(14:03):
addition to supply chain constraints, and in Nvidia, a leader
in the AI chips, is highly exposed to potential regulatory
pressures not just here in the US, but also abroad.
Which brings me to another company that had its challenges
this week, which is Apple. And as you know, Apple
(14:26):
is a tech giant, and they've really faced challenges this
week because Apple stock fell really due to slower than
expected demand for the newest iPhone model, and the company
also continues to grapple with stiff competition from lower cost
smartphone makers, particularly in the international markets like China. And
(14:49):
if we go a little bit further to see how
everything went last week between the winners and the losers,
let's look at some sectors, okay, and the best performing
sectors over the week was really energy. The energy sector
emerged as a top performer this week, and that was
driven by rising oil prices as we talked about, in
addition to geopolitical tensions and the energy sector. XL is
(15:16):
a ticker symbol that I'm referencing here. It posted gains
of about two percent, reflecting investors' confidence in oil and
gas companies like the Chevrons that we spoke of exon Mobile.
Also oil service companies like Halliburton and Schlumberger. They also
performed well as higher prices spurred increased exploration in addition
(15:39):
to production activity. Now, if we look at consumer discretionary
with inflation showing signs of easing, consumer confidence in spending
really remained strong, particularly heading into the holiday shopping season,
which is a great thing. It's something we want to see.
(16:00):
And we saw companies with the consumer discretionary sectors such
as Amazon and Nike benefited from this optimism, with both
stocks posting gains. Now, Nike, we did see they had
to cancel their forward looking projections for investors because they've
got a new CEO. I think they wanted to just
(16:20):
kind of pump the brakes, not get into talking about
how they saw things through the lens of their old
CEO when they have a new skipper in the seat here,
and I think that he just wanted a little bit
of a breathing room and not to not to throw
numbers out there prematurely, because he's still kind of putting
(16:42):
his hands in the mix here to see exactly what
he's dealing with and what he can come up with. Now,
retailers are really expecting a strong finish to the year,
and it's boosted by pent up consumer demand and a
steady labor market. So we'll see if that tailwind helps
take them through the last quarter of the year here. Now,
(17:06):
some of the sectors that are really going to face
some headwinds is going to be technology, and we see
the tech sector really struggled with the technology sector ticker
symbol here is XLK and drop byo point nine percent. Now,
several tech companies, including Nvidia and Apple, really faced challenges
(17:28):
related to regulatory concerns and slower product demand. Additionally, we
saw a heightened scrutiny over data privacy and artificial intelligence regulation,
which created uncertainty for many of the tech giants and
that weighed on their stock prices. Now, outside of technology,
(17:51):
one of the other sectors that we're seeing some challenges
for here in the fourth quarter is going to be
healthcare and they had a tough week this week, and
as pharmaceutical companies in addition to healthcare providers, really continue
to deal with operational challenges, including the labor shortages in
(18:11):
addition to really the increased overall cost So the healthcare
sector ticker symbol xl V as in Victor fell by
zero point one percent, and that really reflected investors unease
over the potential regulatory changes in drug pricing, and that
(18:31):
could negatively impact profit margins for the larger pharmaceutic or
pharmaceutical companies. So something we're going to want to keep
an eye on here. Okay, Now, the tailwinds that could
have a positive market catalyst for us here is going
to be the lower inflation and the potential rate cuts. Now,
(18:55):
one of the most significant advantages for the market moving
forward is the possibility of lower inflation continuing to drive
the expectations for a federal reserve rate cut. Now, remember,
if the Fed adopts more accommodative monetary policy, sectors like
(19:17):
real estate, utilities, and consumer discretionary could see significant gains,
and lower interest rates really reduce the borrowing costs, which
tend to stimulate consumer spending in addition to investments in
these sectors. So energy prices we're seeing with the geopolitical
(19:40):
tensions like Lee are going to continue to persist, particularly
in Ukraine, oil prices could remain elevated, providing continued support
for the energy sector. Now, the winter demand for energy
in Europe and North America is expected to keep oil
prices high, which are going to benefit companies involved in
(20:03):
oil exploration, production and the services. So that being said,
it could be a good opportunity for energy. Now, let's
take a peek at infrastructure spending. Now, the industrial sector,
it could experience a little bit of helpier as governments
(20:25):
around the world are continuing to ramp up infrastructure spending
and in the US initiatives related to rebuilding roads, bridges,
and renewable energy products. They're expected to benefit companies that
manufacture construction equipment in addition to the materials. And on
(20:47):
the flip side of this, some of the areas that
we're going to be facing really a headwind on are
going to be the geopolitical risks. Now, the geopolitical uncertainty,
particularly in Ukraine, remains one of the most significant risks
for global markets. Now. If the conflict escalates and the
supply chain disruption in the critical industries such as energy,
(21:11):
let's say, agriculture, even metals, right, that could negatively impact
a broad range of sectors. And the continued war in Ukraine,
in addition to Israel and going on in Iran and Lebanon.
I mean, that's kind of the tentacles are growing on that,
(21:36):
and we've got a lot of upheaval going on here
and these continued wars are really combined with rising tensions
here and it has the potential, let's just say that
it has the potential to create substantial volatility across global
markets and the tech sector, particularly the companies involved in
(22:02):
artificial intelligence, in addition to data privacy is likely going
to face increased regulatory scrutiny in the coming months. And
this isn't just locally, okay, so it's governments that are worldwide.
They're really stepping up their efforts to regulate AI, the
data usage and cybersecurity, which could impose additional costs and
(22:26):
really hinder the innovation in the sector. And the companies
that could be most impacted by this would be Apple, Google, Meta,
you know, even in Nvidia, as we spoke earlier as well,
and they're really likely to experience volatility as they adjust
to these new regulatory environments. And there's just a lot
(22:51):
going on inside of this AI world and the challenges
behind it. And also we're seeing the healthcare sector is
really facing some challenges as we talked about, But if
we look ahead, we're going to see that many investors
are really contemplating the idea of sector rotation and the
(23:15):
as the market conditions evolve here, so with the federal
Reserve potentially shifting to a more doubvish stance and geopolitical
risks remaining high, certain sectors are going to be more
likely to outperform than others. And here's some strategies that
investors may be considering. So some of them would be,
(23:40):
you know, focus on dividend paying stocks in the defensive
sectors here, because as interest rates begin to level off
or even decrease, investors may want to gravitate towards dividend
baying paying stocks in the defensive sectors like utilities, consumer staples,
(24:02):
and healthcare. Now, these sectors tend to be less volatile,
even though we just talked about healthcare having its challenges,
they tend to be less volatile during periods of economic uncertainty,
and they tend to provide a steady income stream through
the dividends, which can be very attractive to an income
(24:23):
focused investor. Now, investors with higher risk tolerance, they might
continue to focus on energy and industrial sectors which are
expected to benefit from the geopolitical tensions and increase government
spendings in infrastructure. While energy stocks in particular they offer
(24:47):
the potential for significant returns as the oil prices remain elevated,
so the industrial sector could also see gains from the
influx of government spending on infrastructure projects in addition to
renewable energy incentives. Now the caution out there would be
in technology and consumer discretionary so well, the tech stocks
(25:10):
have been really darling at the stock market for the years.
These regulatory challenges and slowing product demand that may cause
some investors to exercise caution when investing in technology sector. Additionally,
consumer discretionary stocks because they may face some new pressures
(25:31):
if inflation persists longer than expected or if consumer spending wanes,
particularly if there's a broader economic slowdown. So, in conclusion,
as we look ahead for the remainder of twenty twenty four,
investors are preparing for volatile fourth quarter, as they should. Okay,
(25:53):
the combination of our geopolitical tensions are regulatory pressures in
a day to uncertainty surrounding the federal reserve policy that's
going to continue to dominate the market sentiment. However, there
are still opportunities for investors willing to navigate these uncertain waters.
(26:15):
And again, energy and consumer discretionary really stands to benefit
from these tailwinds with these oil prices being the way
that they are and the robust consumer demand. So you know,
make sure that you, I guess investors should just really
(26:36):
remain vigilant, okay, and stay flexible in your strategy because
focusing on diversification and staying attuned to the macroeconomic developments
is going to benefit you. And as we approach the
end of the year, the most successful investors, they will
be the ones who can adapt to a changing landscape
(26:59):
while keeping a long term perspective. So keep that in
mind as we go towards the end of the year here. Okay, Now,
I always like to share stories with you. I find
for myself I learned better with stories, especially with a
topic that can be a little bit boring at times.
(27:23):
But let me share with you something that came up
on the golf course the other day. So it was
it was really just I don't know about you, but
a Friday ended up turning out to be just just
an incredible day and I was fortunate enough to get
out and play a little bit of golf, and I
(27:43):
was playing around with a fella and Tom. He's a
sharp guy, successful guy, works in the construction industry, and
he likes to dabble in investing on the side. And
we were we were on the bed and you know,
just like golf, I don't know about you. I may, hey,
(28:05):
maybe you're a scratch golfer, you're a plus handicap.
Speaker 1 (28:10):
Not me.
Speaker 2 (28:10):
Okay, you know I struggle at you know, twelve to thirteen.
I will say I'm getting a little bit better. I
feel like the last five rounds have really I've turned
a corner here. So we'll see. Maybe it's a fluke
and the wheels are gonna fall off the thing, and
or maybe maybe I've just turned the corner. We'll see.
But nonetheless, we were playing good round and.
Speaker 1 (28:34):
Well.
Speaker 2 (28:34):
As we were playing here, Tom said, so, Drew, Yeah,
I've been meaning to ask you something. You know, why
are you always saying that you're so against investing in
mutual funds? I mean, it seems like everybody has them
in their portfolio, So what's the big deal? And you know,
I've gotten this question a lot and I knew that
(28:55):
Tom was asking because he respected my opinion. Still, I
could also tell from his tone that he was really
a bit skeptical, and probably because mutual funds have been
presented to him and to most retail investors as a
convenient and a safe option for long term investing. So
(29:16):
I decided that I would lay it out for him.
And I knew that it wasn't going to be a
short answer, but you know, we had some time to kill.
We still had another ten holes ahead of us, and
the conversation was really kind of as smooth as our
golf game that day. So all right, here's what I said.
I said, all right, Tom, here's the thing about mutual funds.
(29:40):
They're not bad in principle. They were really designed for
a particular kind of investor, but they're not necessarily designed
to maximize the potential for people like you and me.
So let me break down why I do not recommend them,
at least not the way that they're structured today. So
(30:01):
before I got into the technical details, I wanted Tom
to understand where mutual funds came from and who they're
actually designed for. Because most people, they assume that mutual
funds are really a one size fits all solution, but
in reality, they were created for a specific type of investor,
(30:25):
someone who didn't have the knowledge, time, or interest in
managing their own portfolio, and they wanted a diversified really
just a hands off way to invest in the stock market. Well,
mutual funds were initially created for the average retail investor
(30:45):
who wants exposure to a broad range of stocks or
bond but doesn't want to deal with the hassle of
picking individual securities. I explained now, the idea was to
pull money from a large number of investors to create
a diversified portfolio that would be managed by a professional.
(31:05):
So on paper, that sounds great, doesn't it. But here's
where it starts to fall apart. And at that point
I could see Tom really kind of listening intently as
I drove home my point, and I said, these funds
weren't designed for people who are serious about precision in
their investing. They weren't created for people who want to
(31:27):
actively manage risk, make tactical moves, or control their portfolio
in a very detailed way. Instead, quite the opposite, Mutual
funds are a broad stroke solution, and they're made to
appeal to the masses. So I could see that, you know,
Tom was starting to get it, but I wasn't done yet,
(31:49):
because I continued on. I said, think about it. Mutual
funds are basically a basket of stocks or bonds, and
they're managed by a portfolio manager who decides when to
buy and sell individual securities. But you, the investor, you
do not have any control over what's inside of that basket.
(32:12):
And the manager could decide to overweight a sector that
you're really not comfortable with or to underweight one that's
performing well. And once you buy into that mutual fund,
really that's really it. Okay, you're stuck. You're stuck with
whatever decisions that that manager makes. And at this point
(32:32):
I could see that Tom was starting to see where
I was going with this, and I said, so, now,
you could say that that's fine because the managers are professionals, right,
But here's the issue. These managers there, they are not
investing for you personally. They're making a decision that's based
(32:55):
on a set of criteria that may or it may
not align with your individual goals. So you do not
have any say in what's getting bought or sold. And
that lack of precision can really cost you money over time.
So I went on to explain how mutual funds are
often too broad and slow to react to market changes,
(33:18):
and a mutual fund manager may hold on to losing
stocks longer than you personally would like, or they may
be restricted. Actually that's important to note. They may be
restricted by their internal guidelines from making tactical moves to
capitalize on opportunities. So I said, you see, you lose
(33:38):
the ability to be nimble, and in today's fast moving market,
that lack of precision can really hurt your returns. So
at this point Tom interrupted with it. He gave me
a fair question. He said, but aren't mutual funds supposed
to be diversified and low risk? I mean, isn't that
the entire point of them?
Speaker 1 (33:59):
You know?
Speaker 2 (33:59):
I nodded, but I was ready to dig in a
little bit deeper into these issues, and I said, you know, Tom,
I said, you're right that they provide diversification, but that
diversification comes at a price, and that price is not
just monetary, though. The fees are definitely something that we
need to talk about, and it's also about flexibility and control.
(34:24):
And I explained how mutual funds, especially actively managed ones,
They often come with hefty fees, and these fees can
significantly eat into an investor's return over time. And one
of the least expensive ways to buy mutual funds is
through a shares. I said, but even a shares come
(34:46):
with big commissions and upfront fees, So advisors who sell
these funds they get paid when you buy them, and
that can create a conflict of interest. And right after
I said that, I could tell that Tom was really
surprised by this. And I said, and if your advisor
wants to be tactical and move you between funds to
(35:09):
capitalize on the market opportunities, you can't really do that
efficiently and effectively with mutual funds because you're limited to
staying within the same fun family unless you want to
pay additional fees, which people should not do. Now, if
(35:30):
they move you into C shares, those come with an
even higher expense, which can further erode your returns. Now,
the only reason you would move to C shares is
so that you could use mutual funds in all these
stuff different fun families and hit different sectors. Okay, but
(35:53):
one thing to keep in mind, and I don't want
you to forget about this. Let's not forget about the
advisors who sell these funds. I added, The licensing requirements
to sell mutual funds are the easiest to obtain in
the financial services industry. All you need is a basic
(36:13):
license and a Series six and then you can sell
mutual funds and that's it. So the average advisor selling
mutual funds may not be very experienced at all when
it comes to actual investing. They're more like product salespeople,
is what I explained to them. And I could tell
that this was really a revelation for Tom because he
(36:34):
had always assumed that any financial advisor selling investments would
have a deep knowledge of the markets. Well, unfortunately, I
think that's the common on the common belief out there.
But it's unfortunate because that's often not the case. And
I'm a living testament to that because I started in
(36:54):
this industry with a Series six and had virtually absolutely
no training on investments. It was just product sales. It
wasn't until about two thousand and well, yeah, about two thousand,
maybe twenty thirteen, when I got my Series seven that
(37:14):
I really got passionate about understanding alpha, the beta sector
strengths and weaknesses, and how individual stocks and bonds and
ETFs are so much brings so much value to an
advisor's practice because they're able to carry that on with investors.
(37:39):
But let me get back to my story. Okay, So
now I said, let's talk about the myth of high
performing mutual funds. And I said, even the most impressive
mutual funds, the ones with stellar returns, they're often holding
the same stocks that you could buy individually. So let's
say that you had a mutual fund that's heavily invested
(38:02):
in Apple, Amazon, and Google. You could have just bought
those individual stocks yourself and probably done a lot better
without paying the extra management fees. And I pointed out
that while mutual funds really offer diversification, you're often better
off just owning the best performing stocks in the portfolio
(38:26):
directly because mutual fund managers are trying to beat the market.
But after you factor in fees, most of them don't.
You do better owning a concentrated portfolio in high quality
individual stocks. So at this time Tom seemed to be
nodding along with the idea, and I could tell that
(38:47):
he was really starting to understand the downside of mutual
funds compared to owning individual stocks or an exchange traded fund,
and I went on to explain to him that tax
efficiency is really one of the biggest drawbacks, and one
of the most important points that I wanted to drive
(39:10):
home was that tax inefficiency in mutual funds is something
to be aware of. And this is something that often
flies under the radar for most investors, but it can
have a huge impact on your long term returns. So
here's the thing, I said. Mutual funds are not as
(39:33):
tax efficient as ETFs or individual stocks. When a mutual
fund manager decides to sell a stock in a fund
that can trigger capital gains distributions, even if you didn't
personally sell any shares of the fund, you could still
be hit with a tax bill. And I explained how
(39:53):
mutual fund investors can end up paying taxes on gains
that they never realize simply because the man was forced
to sell shares simply to meet redemptions from other investors.
And that's not a good thing. And this happens a
lot during market corrections, I explained, because inexperienced or impatient
(40:16):
investors really will panic and they pull their money out
of a fund which forces a manager to sell stocks
to meet those redemption requirements. Now the remaining investors, like you,
you get stuck with that tax bill. Meanwhile, if you
owned those individual stocks yourself, you wouldn't have to sell
(40:38):
anything unless you wanted to, meaning that you could defer
your taxes for as long as you wanted. At that point,
Tom's eyes really kind of opened up and he said,
I had no idea that that could happen. Well, it's
one of the hidden draw down of mutual funds, I said,
And it's really one of the reasons why ETFs and
(41:00):
individual stocks are so much better for tax efficiency. So,
with all of this in mind, I wanted to show
Tom the alternative to mutual funds, using the individual stock
scenario and ETFs and a portfolio instead. And I said,
you know something, ETFs are a great option. They offer
(41:22):
the same diversification benefits as mutual funds, but without the
high fees and the tax in efficiencies. Plus they trade
like stock, and what that means is that you can
buy and sell them throughout the day, giving you more
control over the pricing of your portfolio. So I explained
how ETFs are generally much cheaper to own than mutual
(41:45):
funds because they have lower expense ratios. Now they also
tend to be more tax efficient since they don't have
to sell shares to meet redemptions the way that mutual
funds do. So I said, you know, if you need
an actively managed portfolio, whether it's for sector exposure or
(42:06):
broad market approach, it's better to work with an advisor
who uses individual stocks and ETFs because then you're going
to get the precision and the control that you want
and need with all of the downsides or what I
should say without without all of the downsides of the
mutual funds. So I also pointed out that the individual stocks,
(42:30):
you're not paying anyone to manage your portfolio. You're making
the decisions yourself or with an advisor's help, and that
gives you complete control over your tax situation and your
investment strategy. So stocks, ETFs, and bonds they're just more efficient,
I said, They're cheaper, they're more flexible, and they're better
(42:52):
for tax planning. Mutual funds, on the other hands, they're
designed for people who don't want to manage their money.
So if you're serious about investing, they're really just not
the right tool. For the job. And one last point
that I wanted to make was about the fees that
are associated with mutual funds. The least expensive way to
(43:16):
my mutual funds with an advisors through a shares, I said,
But even with a shares, like I said earlier, you're
looking at big upfront commissions and ongoing fees, and these
fees can really eat into your returns over time. I
explained how with a shares the commission can be as
(43:36):
high as five percent, which means that right off of
the bat, you're down five percent on the investment, and
that's really a tough hurdle to overcome, especially if the
fund underperformed. And if your advisor wants to make tactical moves,
they're limited in what they can do with mutual funds.
So I continued on. I said, if you want to switch,
(43:59):
if they want to switch you from one mutual fund
to another to capture opportunities in different sectors, you're stuck
within the same fun family unless you want to pay
more fees, and that lack of flexibility can really cost
you money. So he says, well why do I Why
(44:20):
would I want to go to another fun family? And
I explained nobody. No Fun Family does the best across
all sectors in the market. So you know, if you
want to for all all you Yankee fans out there,
I'm going to use the Yankees for a second. Okay.
(44:42):
So if you want the best first baseman, the best
second basement, best shortstop, third baseman, and all the different positions, okay,
you're not going to find those individuals inside of one
Fun Family. You would have to use all the different
Fun families, have them step up to the plate, and
then screen for what you're looking for. Now, to do
(45:05):
that with A shares, you're going to miss out on
what we call breakpoints, which becomes more expensive for investing.
So in order to do that, you would want to
use a C share or institutional shares along that level.
And with the C shares with someone that's not using
(45:26):
a fee based account, you have higher ongoing expenses compared
to A shares, And with C shares the fees are
so hot. They're really just so high that it's hard
to make any real money in the long run. So
if your advisor is trying to be tactical with your
portfolio and using C shares, you're going to end up
(45:48):
paying a lot in fees for a very little benefit.
The better approach is going to be working with a
knowledgeable advisor, and I can see the Tom was starting
to understand why wasn't a fan of mutual fund but
I wanted to make sure that he knew what to
look for in a better investment strategy, So I said, Tom,
(46:10):
here's the key. The key is to work with an
advisor who really knows what they're doing, someone who uses
individual stocks, bonds and ETFs to build your portfolio. Because
with those tools you can be much more precise in
your investment strategy, you can make tactical moves without paying
(46:34):
unnecessary fees, and you can manage your taxes much more efficiently,
which your accountant will really appreciate. And I finished by
reminding Tom that investing is not about following the crowd.
It's about finding the best strategy for your specific goals
(46:57):
and risk tolerance. Again, mutual funds are fine for some people,
I said, but for someone who wants more control, more
flexibility and lower costs, you would be better served using
individual stocks and ETFs because they are a far better option.
(47:20):
And so as we wrapped up our round of golf,
I could see that Tom was thinking about what I'd said.
You've definitely given me a lot to think about, Drew,
And at that point I replied with a smile. Investing
is all about making informed decisions. Tom. Mutual funds might
(47:41):
work for some people, but if you personally really want
to get the most out of your portfolio, well then
it's worth looking at other options. And with that said,
as we're heading back to the clubhouse, knowing that the
conversation that we just had, it might help Tom just
like him, take really a more thoughtful approach to their
(48:03):
investments in the future. So I share that story with
you because although mutual funds can serve a purpose for
certain investors, particularly seeking hands off diversification, however, for those
of you who want more control, precision, and tax efficiency,
(48:24):
they come with significant downsides. Higher fees, lack of flexibility,
and tax inefficiencies often make mutual funds less than ideal
choices for serious investors, and by focusing on individual stocks,
ETFs and bonds, you can create a more tailored, cost
(48:45):
effective investment strategy that aligns with your financial goals and
your risk tolerance. So always ensure that you're working with
a knowledgeable advisor who prioritizes your interests and employs investment
tools that maximize your potential for success. So one thing
(49:05):
to make sure that you take away from this is
Tom's last question. He said, Okay, I understand your take
on mutual funds, and I know that some people swear
by them, and obviously I understand where you're coming from.
It makes all the sense in the world to me.
(49:27):
So what should I do at this point? And I
said to him, Tom, listen, of course, I'd love to
work with you, Okay. I enjoy our time together and
I appreciate the fact that you're teachable. So that being said,
(49:50):
you know, I'm not somebody to handcuff somebody. I'm not
really a hard sell type of an individual. And I said,
before I answered this question, let's take a step back
and talk about why having a financial advisor, whether the's
Series seven licensed or a registered investment advisor representative, is
(50:13):
so important. You see, whether you're talking about mutual funds
or individual stocks, there's a common thread the need for
professional guidance. And I paused to let that sink in
for a moment before I continued. I said, you mentioned
(50:33):
that you've been buying stocks on your own and I
get that a lot of people like the idea of
being in control of their investments. But the real question
is are you making the best possible choices for your
long term goals? And that's where the role of an
advisor comes in, and it ties directly into mutual funds
(50:58):
why they may not be as beneficial as they seem.
So at this point, Tom was really listening intently, and
I began to explain to him really the difference and
why you want to work with a financial advisor that
(51:19):
is properly licensed and not have a go at it
yourself a DIY investment approach, because Series seven licensed financial
professionals or a registered investment advisor is not only important,
but it's crucial to deal with an individual like that
(51:42):
if you're serious about managing your wealth. Now we see
the rise of these online trading platforms and it has
made it easier than ever for people to invest in
stocks on their own with apps like Robin hood E
Trade Fidelity. Anyone with a smart trone a smartphone, I
should say smart throne, Oh my gosh. I don't know
(52:03):
about you, but sometimes I like to pay attention when
I talk because I don't know what I'm gonna come
up with, and that's one of them. But anyone with
a smartphone can become a trade or really in minutes.
And at first glance, you you know, you feel empowered.
There's no middleman, there's no fees, and you're in full
control over which you buy and sell. I mean, why
why is that not appealing to somebody? Right? You know,
(52:25):
we like to feel like we're the end to all
be all in different areas of our life. Unless you're
highly educated, and you know that the value of a professional.
So with that being said, seek out the proper counsel,
get the help that you're looking for because it will
(52:46):
be invaluable to you. So we're getting ready to wrap
up our show here. I've really I've enjoyed sharing this
time with you. Thank you so much for giving me
this part of your life. I realize this is this
is time of your life you're never gonn to get back,
so I want to make it valuable. If you're tuned
in here again, thank you so much. You're listening to
Drew Prescott, chartered Retirement Planning counselor, Accredited Wealth Management Advisor
(53:11):
and President and wealth Advisor at Prescott private wealth. This
is your money matters and it can be heard here
every Sunday at eleven am on WGY Radio eight ten
am one oh three to one FM. And I hope
you just have such a wonderful Sunday. And before we
come to a complete closure on the show, I wanted
(53:33):
to I wanted to throw this out there for you.
Last time I put a special out there for putting
together a financial plan, it was so well received, I
want to put it out there again. Okay, And so
let me explain why I'm so passionate about having a
(53:54):
financial plan. Would I do for a client when they
have a financial plan? Is this? Listen? A lot of
stuff happens out on the golf course. Let me tell
you so. I hate to use the golf course as
an example, but a lot of questions come up on
the golf course. I had a young man who's in
(54:15):
his forties, wildly successful in real estate and has very
little debt, and he has been approached by a fella
that is only licensed to sell life insurance. Great guy,
but he came at him with about three different ideas,
all using life insurance and poop poot investments. The entire
(54:39):
time now this individual is no longer licensed to sell investments,
so obviously he has a he's got an edge to
grind here because he only has one side on his sword. Now,
this guy, the young real estate will call him mogul, right. See,
(55:00):
he is doing such a great job. But he was
literally sick to his stomach because this fella was promoting
that he put several hundred thousand dollars into life insurance
each year in two different scenarios, and he didn't know
if he was doing the right thing. Now we're working
with this individual on a financial plan. We've got a
(55:21):
team of CPA's attorneys and advanced planning individuals that and
cfps that are working on his financial plan, and it
is wildly impressive in addition to incredibly beneficial for him
and his family. Now, I want to offer you the
ability to have the same type of tools available to you,
(55:46):
and I'm going to do a financial plan for fifteen
hundred dollars for you. Okay, it's fifteen hundred dollars. My
team will work on it, we'll deliver it to you.
You'll end up with a binder, a life binder that
as everything in place in the event that you were
to pass away and you need to hand it along
to your family, So reach out for that special again.
You're listening to your money Matters. I'm your host, Drew Prescott.
(56:10):
You can tune in every Sunday w g y A
ten and one O three one FM. Feel free to
call in five one eight two zero three one nine
eight three and have a beautiful Sunday and God bless
Popular Podcasts
Dateline NBC
Current and classic episodes, featuring compelling true-crime mysteries, powerful documentaries and in-depth investigations. Follow now to get the latest episodes of Dateline NBC completely free, or subscribe to Dateline Premium for ad-free listening and exclusive bonus content: DatelinePremium.com
24/7 News: The Latest
The latest news in 4 minutes updated every hour, every day.
Therapy Gecko
An unlicensed lizard psychologist travels the universe talking to strangers about absolutely nothing. TO CALL THE GECKO: follow me on https://www.twitch.tv/lyleforever to get a notification for when I am taking calls. I am usually live Mondays, Wednesdays, and Fridays but lately a lot of other times too. I am a gecko.