Our Core Principles

January 12, 2022
min. read

As always, we like to kick off the new year by revisiting the core principles and fundamental beliefs we have here at Gg. We then revisit 2021 and touch on exciting things to come for 2022. We hope you enjoy!

Core Principles

At the Gleason Group, we are long-term, goal-focused, plan-driven investors.

We believe that your financial plan is a living document that should be revisited and adjusted based on your life, not the market.

We believe that no action, especially during times of extreme market volatility, is a powerful action.

Substandard returns and investment failures are caused by reacting to or trying to anticipate economic and market events.

We are convinced that the economy cannot be consistently forecasted, nor the markets consistently timed.

Therefore, we feel that the only reliable way to capture the full long-term return of your investments is to withstand the frequent, but historically temporary, declines.

In the last four decades, the average annual price decline, from a peak to a trough, in the S&P 500 exceeded 14%. One in five years, the decline has averaged twice that. And on two occasions (in 2000-02 and 2007-09), the Index was halved. Yet the average annual compound rate of total return for the S&P 500 between 1980 and 2021 was more than 12%.

The vital challenge to long-term successful investing is neither intellectual nor financial, but temperamental.

It’s how you react, or choose not to react, to market related events and the volatility that comes with it that matters most in being a successful lifetime investor.

These principles will continue to govern the behavioral nature of our advice to you in the coming year and beyond.

Current Observations

The last two years have undoubtedly been the two most shocking, and terrifying, years since the Global Financial Crisis of 2008 — first the outbreak of the pandemic, next the bitterly partisan election, then the pandemic’s second major wave, and most recently a 40-year inflation spike.

You have probably experienced some serious volatility fatigue. I know I have.

Which brings us to today and we are enduring more of the same on the volatility front with relentless fears of inflation, the federal reserve, rising interest rates, and the latest variant of Covid.

There is more noise than ever.

If there were ever a time to put our heads down and stick to our financial plan—ignoring the noise—it’s now.

But now, just like in those previous panics, what mattered most was not what the economy or the markets did, but how you behaved as an investor.

The S&P 500 was up nearly 20% in 2020 and almost 30% in 2021. If you fled the market during either crisis—or both—you permanently scarred your financial future, missed crucial gains, and may never financially recover.

If on the other hand, you continued to maintain focus on a long-term plan, positive outcomes followed, and you participated in every bit of this historic rebound. While we do not make market predictions, we know that like all other fears and crisis before them, the current fears will eventually subside, and the market (and your portfolio) will continue the long-term upward trend.

Our advice, as it’s always been, is to focus on your life and your goals, not the market or current events.

What a Year!

We successfully navigated you through a host of “threats” in 2021 ultimately resulting in, from a performance standpoint, one of the best years in recent memory in the market.

We adopted Calendly as a convenient and efficient way to book your appointments with us and continued to expand our virtual meeting capabilities.

We continued to invest in talented professionals to better serve you, successfully adding two new talented team members in Maggie Young and Angie Schmitt.

And last, but not least, we implemented a bevy of new internal processes and team continuity plans behind the scenes to improve our service and guidance to you.

The best part? We’re just getting started…There is much, much more to come.

As always, we welcome your comments, questions, and concerns.

While we can’t predict, we can plan.

Thank you for being our client. It is a privilege to serve you.