Don’t Like Things Too Much

Amelia, our 4-year-old, likes the cheapest toys we buy her. Seriously. Santa brought an expensive dollhouse one year, she has a kitchen set, and the list could go on. But do you know what her two favorite toys are?
Amelia with Thriller puppy
One is a plastic riding snail shaped toy that she zips around the house on perpetually nearly crashing into stuff. It only cost 20 dollars and it has been going strong for over 3 years now. She’s pictured below on it as baby.
She’s kind of like our dog, Oscar, in that respect. He almost always catches the squirrels in the backyard but never quite gets them. Amelia almost always comes close to crashing, but never does.
The other toy that she adores is a Halloween themed puppy decoration that dances and sings Michael Jackson’s “Thriller.” Amelia and Thriller are pictured above.
Amelia as a baby
This isn’t a phase either… This is a long-term pattern. Nearly everyday she affectionately plays with both Thriller puppy and her riding toy named “Boogie Woogie.” We even had to celebrate Thriller’s birthday recently.
I refilled my business card holder yesterday in my office and the new cards came in a small colorful box and I thought: “I bet Amelia will love this box when it’s emptied.” Forget Christmas gifts, we’ll just go to the recycling center and get her some gems this year!
If something were to happen to one of these toys she would be upset and distraught, and I suspect we would hear about it for quite a while.
Amelia riding
While we may not get quite as enamored with our investments, we sometimes become quite loyal to the companies we are invested in.
It may be a company we worked for or it may be an investment we inherited from our parents. Oftentimes, people in this scenario have a high concentration of their portfolio in one stock or one industry sector.
The problem with this type of investing is that sometimes companies or sectors falter and this could leave us overexposed and feeling distraught.
Just as if Thriller or Boogie Woogie were to break and Amelia would be disappointed, we don’t want to be overly allocated in one sector in the event that the investment underperforms.
Amelia going fast
If we’re invested in stocks, it makes sense to have numerous companies. A lower cost way that requires less rebalancing is to use index funds.
An example of an index is the S&P 500. The index was created in 1957 and it was designed to represent 500 large US companies. Today there are many different types of indexes to allocate to.
We can use index funds to allocate to bonds, commodities, real estate, technology, emerging markets, international markets and the list goes on. With index funds we are diversified amongst the companies inside of the index and this prevents us from being over exposed to one company. Also, what this does is it allows us to be diversified, thereby not being disappointed if a company underperforms.
When the market turns down as it has this year, it’s a great time to evaluate how your portfolio has performed under stress and assess whether you need to rebalance to get your holdings in line with your priorities.
Perhaps an index fund may be appropriate for you. If you need assistance with rebalancing and accessing whether your allocations are in line with your goals and objectives please call our office at 864.641.7955.


Clients Excel, LLC is an independent financial services firm that utilizes a variety of investment and insurance products. Investment advisory services offered only by duly registered individuals through AE Wealth Management, LLC (AEWM). AEWM and Clients Excel, LLC are not affiliated companies. Neither the firm nor its agents or representatives may give tax or legal advice. Individuals should consult with a qualified tax professional for guidance before making any purchasing decisions. Clients Excel, LLC is not affiliated with or endorsed by the U.S. Government or any governmental agency. Clients Excel, LLC has a strategic partnership with tax professionals and attorneys who can provide tax and/or legal advice.

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