Creating a Strong Portfolio and Honoring Veterans

Michelle Bertram and Beverly Bertram are financial advisors living in Mineral Point WI and serving the surrounding communities. Michelle Bertram does financial planning for retirees along with business consulting. Beverly Bertram specializes in retirement planning and income planning for her clients. Michelle Bertram and Beverly Bertram are authors of the book, Creating You DREAM Retirement and creators of the DREAM Retirement Process. Serving Madison WI, Verona WI, Mount Horeb WI, Barneveld WI, Dodgeville WI, Dubuque IA, Platteville WI, Lancaster WI, Cuba City WI, Fennimore WI, Darlington WI, Monroe WI, Spring Green WI, Black Earth WI and beyondThere are four basic investing terms that deal with the tactics of investing; active, passive, strategic and tactical.
Let’s start with passive. In passive investing, the goal is to match the benchmark’s performance. For example, there are multiple S&P 500 index funds. These funds are investing to mirror the S&P 500 index; this is as close as you can get to investing in an index. Passive funds will mirror the benchmark’s performance whether it be the S&P 500 or another index, all the ups and downs. Passive management is the typical buy and hold style.
Active management strives to outperform the benchmark, on the upside – better growth or the downside – less loss. Active management can be aggressive or conservative. Strategic and tactical styles can both be utilized in an active portfolio. To understand this better, let’s compare to the military.
A strong military has a strategic plan that dictates where they station troops (which funds to buy), how many troops are stationed in each location (how much of each fund) and how they train (due diligence process). It is more of a long-term approach (more of a buy and hold approach but with the ability to move strategically when needed). We have troops strategically stationed all over the world right now with different missions (conservative, aggressive). However, the ultimate mission is to defend our country (met the investment goals).
While the overall military is strategic, they have special forces for tactical missions. A tactical mission is more short-term in nature with long-term preparing and training. A tactical mission may involve capturing a target; it is all about getting in and getting out. That’s tactical investing, when to get in and out of the market based on signals and indicators that the manager relies upon.
A strong military is active and consists of a good strategic plan and a team of special forces for tactical missions. How does your portfolio stack up? Is it strong? Is there potential for great losses? One thing I know, a strong military is always watchful… We are on the tail end of a bull market, it is important to be alert and know your risks, get a risk assessment done today to make sure you are protected with a strong portfolio.
A BIG THANK YOU TO ALL OUR VETERANS AND ACTIVE TROOPS! WE APPRECIATE YOU AND THE FREEDOM YOU GIVE US!!