Insights: Being asked to act as executor, are portfolio changes warranted with volatility + the Swedish Sphinx
Good reads:
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·????????Weekly Investment Strategy
·????????Why Gas Prices Matter So Much
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Best quote of the week:
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“Whenever you hear someone say there’s no way out from here for equities, remember March 2009, March 2020 at the COVID lows, and every other bear market or correction low.?The way out for the market was never obvious. It never is.” – Bespoke Investment Group
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International Women’s Day:
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I celebrated International Women’s Day by presenting to the Kelowna Chamber of Commerce. My topic: Take the Reins on Your Finances.?I can’t think of a better way to spend #IWD than to present to some of Kelowna’s most amazing females!
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If you’d like me to speak to your employees or at an event, please get in touch. I’m always happy to help.
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#IWD2022 #BreaktheBias #WomensDay
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Have you been asked to be an executor?
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If you answered yes, you may want to think carefully about the decision. While it’s certainly an honour to be asked, the reality of the workload and potential personal liability involved can be overwhelming.?
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Here is a great Q&A that my Raymond James Trust (Canada) team put together*:
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How do I choose my executor? Factors will include location, age, time commitments and the person’s skillset. They will need to be organized (and good at getting things done), detail oriented, and have an understanding of tax, investments and financial decision-making. Can they support and manage family relationships positively? Complex estates require a higher level of expertise. Such estates might include out of province assets, privately held business, dual/US citizenship, and blended families or complicated family dynamics Nevertheless, even a ‘simple’ estate can create many challenges for an Executor.
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Should I have more than one executor? That will depend on your unique circumstances but frequently one, along with an alternate in the event they are unable to take on the role, is sufficient. Most provinces require the executors to agree on decision making, so if you have more than one executor it can add to the complexity and can result in delayed estate administration or an application to the court to resolve a disagreement – at your estate’s expense.
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Do I pay my executor? It is reasonable to pay your executor for the many hours of work involved and the risk of personal liability they assume by virtue of the appointment. As a general guide, an executor is entitled to between 3% and 5% of the gross value of your estate.
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What if I don’t have someone suitable to appoint? There are more options available today than ever before. One option is to use professional trust services. As an example, Raymond James Trust (Canada) is able to act as your executor by appointment or by providing support services to your chosen executor to facilitate estate administration.
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Best soundbites of the week:
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Unlike last year, the markets definitely haven’t been lacking volatility in 2022.?Volatile markets can be tough to stomach, so here is an interesting blurb that helps put market volatility into some perspective. Note: the VIX is an index that essentially represents the expected level of volatility in the US stock market over the next 30 days. A low reading means lower expected volatility and a high reading means higher expected volatility.
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As much as sentiment has worsened and as painful as the declines from the January highs feel now, they are a blip when viewed in the context of the last 13 years.?Just to put things in perspective, on Monday, the S&P 500 fell more than 2.95% for its worst one-day decline since October 2020. From September 2008 through March 2009, though, there were more than 30 one-day declines of 2.95%! For another example, the CBOE Volatility Index (VIX) closed above 30 for the 7th straight day on Tuesday, which is one of just 17 streaks where it has closed over 30 for seven or more days. On 3/9/09, though, the VIX closed at just under 50 in what was the 121st straight day of closes above 30 and ultimately the longest ever streak of closes above 30 (170). – Bespoke Investment Group
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Volatility can cause investors to act on their emotions. When volatility is high, those emotions can often cause investors to do things like sell at the bottom or buy at the top (in other words, the exact opposite of what investors should be doing).?The following quotes are essentially two different ways of saying the same thing: the best way to weather volatility is to build in some risk management into your portfolio and one of the ways you can do that is by adding in diversification.
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Quote 1: How to tell if you need to make changes to your investment portfolio because of the Russian invasion of Ukraine: You own a highly speculative portfolio designed for last year’s go-go stock market conditions. If you own a diversified portfolio, a balanced mutual fund or an asset allocation exchange-traded fund that corresponds with your personal investing profile, you can stand down… Old-fashioned diversification is how you build a portfolio that can weather a conflict like the one happening in Ukraine. You may already have that diversification. – Rob Carrick, The Globe & Mail article
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Quote 2: The point here is there are no perfect assets. Nothing hedges you against every single risk at all times… There is no hedge that works for inflation, deflation, up markets, down markets, rising rates, falling rates, peace, war, recessions, expansions and everything else. The good news is once you realize there are no perfect assets, you can begin to create a portfolio that takes into account the fact that nothing works always and forever in the markets. – Ben Carlson, A Wealth of Common Sense article
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Best visual of the week:
The visual below is pretty self-explanatory. The takeaway message: stick to your long-term plan and ignore market noise.
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According to GRIT Capital: Here's what happened after 10-15% corrections over the last 40 years. On average, 92% of the time, a year later the S&P is +21% higher.
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Looking for your feedback:
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I'd love to know what topics most interest YOU. Are there any particular ones that you'd like me to cover? What matters most to you right now?
Send me a note and let me know: [email protected]
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Beyond the markets:
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Visual Capitalist put out an interesting infographic showing which countries feature women on their banknotes. Not surprisingly, Queen Elizabeth II is the most featured woman worldwide. We all know her face on our $20 bill, but she’s also been on banknotes in the UK (duh), Australia, New Zealand and many British Commonwealth states and Crown dependencies.
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One of the people featured on a banknote that came as quite a surprise was Swedish-American actress, Greta Garbo. Sweden has her on its 100 krona note.
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Here are some other interesting facts about the “Swedish Sphinx”:
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·????????She was born in Sweden on September 18, 1905 as Greta Lovisa Gustafsson.
·????????When she came to America in 1925, Garbo didn’t know any English. Although she eventually learned the language, her heavy accent and deep voice made MGM executives hesitant to transition her from a silent film actress to one who spoke.
·????????She eventually appeared in her first sound film in 1930 called Anna Christie. The film ended up being a huge success and she was nominated for a Best Actress Academy Award.
·????????Greta Garbo was dubbed "the Swedish Sphinx" due to her extreme introversion. She said: "When I was just a little child, as early as I can remember, I have wanted to be alone. I detest crowds … don't like many people." Later in life, Garbo used aliases and bought multiple airplane and theater seats to preserve her privacy.
·????????Garbo reportedly collected information about Nazi sympathizers in Sweden for the British Secret Intelligence Service. Garbo told her friends that she wanted to meet Adolf Hitler, who had sent her a fan letter, so she could kill him with a gun hidden in her purse.
·????????Greta Garbo owned one of Rin Tin Tin's puppies. Jean Harlow also had one.
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Source: Mental Floss
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Thanks for reading and wishing everyone a great weekend!?
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Cheers,
Kim
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Kim Inglis, BCom, CIM, PFP, FCSI, CAFA
Portfolio Manager
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T: 416.777.6417 (Toronto)
T: 604.654.1160 (Vancouver)
T: 250.979.1803 (Kelowna)
TF: 1.877.363.1024
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The opinions expressed in this newsletter are those of the Financial Advisor Kim Inglis, BCom, CIM, PFP, FCSI, CAFA and not necessarily those of Raymond James Ltd. (“RJL”) or Raymond James (USA) Ltd. (“RJLU”).?Statistics, factual data and other information presented are from sources, believed to be reliable but accuracy cannot be guaranteed. It is furnished on the basis and understanding that Raymond James Ltd. and Raymond James (USA) Ltd. is to be under no liability whatsoever in respect thereof. It is for information purposes only and is not to be construed as an offer or solicitation for the sale or purchase of securities. Raymond James Ltd. and Raymond James (USA) Ltd. financial advisors may only transact business in provinces and/or states where they are registered. Follow-up and individualized responses involving either the effecting of or attempting to effect transactions in securities, or the rendering of personalized investment advice for compensation, will not be made to persons in provinces or states where the financial advisor is not registered. Raymond James Ltd. is a member of the Investment Industry Regulatory Organization of Canada (IIROC) and the Canadian Investor Protection Fund. Raymond James (USA) Ltd., member FINRA/SIPC. This provides links to other Internet sites for the convenience of users. Raymond James Ltd. is not responsible for the availability or content of these external sites, nor does Raymond James Ltd endorse, warrant or guarantee the products, services or information described or offered at these other Internet sites. Users cannot assume that the external sites will abide by the same privacy policy which Raymond James Ltd adheres to.
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* This document is solely for informational purposes and is subject to change based on relevant facts, jurisdiction or laws. Raymond James Trust (Canada) and its employees do not provide legal or tax advice and have no liability with respect to the information provided. Individuals should always consult their own lawyer and/or qualified tax professional for advice regarding their specific situation.
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