The Market Has No Memory

By David Booth Executive Chairman and Founder

Jan 03, 2020

I have worked in finance for over 50 years, and it seems that every January the same thing happens. Lots of folks look back at last year’s performance to draw conclusions they can use to predict what markets will do in the year to come. I don’t make predictions, but I do think it’s worth answering this question: What are the lessons from 2019 that we can apply to 2020?

Let’s go back to where we were this time last year. The words running across CNBC’s home page were, “US stocks post worst year in a decade as the S&P 500 falls more than 6% in 2018.” The Wall Street Journal summarized the state of market affairs with this headline: “U.S. Indexes Close with Worst Yearly Losses Since 2008.” Amidst gloomy predictions for 2019, I posted a video on the limitations of forecasting.

Things felt ominous. We started the year with a lot of anxious people. Some decided to get out of the market and wait for prices to go down. They thought that after 11 years, the bull market was finally on its way out. They decided to time the market.

We all know what happened. Global equity markets finished the year up more than 25%1 and fixed income gained more than 8%.2

Missing out on big growth has as much impact on a portfolio as losing that amount. How long does it take to make that kind of loss back? And how is someone who got out supposed to know when to get back in?

The lesson from 2019 is: The market has no memory. Don’t time the market in 2020. Don’t try to figure out when to get in and when to get out—you’d have to be right twice. Instead, figure out how much of your portfolio you’re comfortable investing in equities over the long-term so you can capture the ups and ride out the downs. A trusted professional can help you make this determination, as well as prepare you to stay invested during times of uncertainty.

Not enough “experts” subscribe to this point of view. They’re still trying to predict the future. You’ve probably heard the saying, “The definition of insanity is doing the same thing over and over again and expecting a different result.” I’ve seen people make this same mistake for 50 years.

We’ll never know when the best time to get into the market is because we can’t predict the future. And if you think about it, that makes sense. If the market’s doing its job, prices ought to be set at a level where you experience anxiety. It’s unrealistic to think the market would ever offer an obvious time to “get in.” If it did, there would be no risk and no reward.

So what should you do in 2020? Keep in mind 2019’s most important lesson (which is the same lesson from every year before): Stay a long-term investor in a broadly diversified portfolio. Reduce your anxiety by accepting the market’s inevitable ups and downs. Make sure the people advising you align with your perspective. Stop trying to time the markets, and you’ll find you have more time to do the stuff you love to do.


  1. 1Source: MSCI World Index
  2. 2Source: Bloomberg Barclays Global Aggregate Bond Index


This information is for educational purposes only and should not be considered investment advice or an offer of any security for sale.

Diversification neither assures a profit nor guarantees against loss in a declining market.

Dimensional Fund Advisors LP is an investment advisor registered with the Securities and Exchange Commission.


Teresa Staker
Teresa Staker
Administrative Assistant
p // 801-494-6047

Former Banker Teaches His Kids 5 Lessons

Re-posted from MSN.COM

A former banker teaches his kids these 5 lessons about money

Eric Rosenberg 10/9/2019

It’s never too early to start teaching your kids about money. While my 1-year-old just likes playing with her toy cash register, my 3-year-old is starting to understand more about how we have to earn money and have limits on what we can buy.

In my time working as a bank manager, I found that even many adults don’t know much about how their finances work. I’m starting my kids with early lessons on some of the most important financial concepts. If you have kids, make sure you teach by example and instill these lessons so your kids can thrive with their finances in the future.

1. Know your bank account balances

When I was around 5 years old, my mom took me to a local bank to sign up for a kids’ “Dinosaver” account. In addition to a toy dinosaur to take home, the bank was the first place to send me something in the mail every month. While I’ve gone paperless these days, I still keep tabs on my account balances on a regular basis.

I generally only added to my savings account and loved seeing the few cents of interest added to the balance in addition to deposits around my birthday and the holidays.

These days, my bank accounts often have multiple transactions per day, but I always know my balance within a hundred dollars or so. You can teach your kids to do the same.

Related video: A message for young people who are confused about money (provided by NBC News)

2. Understand how credit cards work

You can’t get a credit card until you’re 18, but you can ruin your credit in a few months in a way that takes a decade or more to fix. If you pay with plastic regularly, you have plenty of opportunities to teach your kids how credit cards work.

My oldest knows that when I buy something with a card, it uses money just like the kind I have in my wallet. I have to pay for it from my bank account before the end of the month so I don’t have to pay interest. This concept is easy to understand but may be challenging in the real world. Teaching your kids to follow good credit habits can save them a fortune in interest in the future.

3. Build an excellent credit score

If your kids know how credit cards work and use them responsibly, they are unknowingly building good credit. But rather than go into it blind, you can teach your kids how credit scores work so they can qualify for the lowest interest rates and best accounts. It may mean the difference between being able to buy a home or not when they decide it’s time.

The biggest factors in your credit score are your payment history and your credit balances. Those two components alone make up over half of your credit score. My dad also put me on track to good credit at a young age when he made me an authorized user of a card “just for emergencies” in high school. I’ll pass on that same gift to my kids when they get older.

4. Take advantage of what your bank offers

When I worked at a bank, I learned about how checking, savings, CD, credit card, and loan accounts work. Bank manager classes taught me how customers can get the best experience from each account and how banks make money. As my kids get older and try out new kinds of accounts, I’m teaching them how they work.

Make sure you don’t pay any fees on checking or savings accounts. Get a credit card that offers rewards and pay it off in full every month to avoid interest. Turn on automatic bill payments and automatic savings. These are all great lessons … and strategies to follow yourself.

5. Spend less than you earn

The toy aisle at Target or Walmart is a potentially expensive proposition for parents with young kids in tow. However, I look at a toy store or toy department as a teaching opportunity. There’s nowhere better to give a lesson on budgeting.

In my banking days, I saw the perils of going without a budget when customers visited the branch asking for overdraft fees to be waived. I saw it in the collections department and credit card balance reports. If you can spend less than you earn and save and invest the rest, you’re on the right track.

Give your kids the right financial compass

You can work with a trusted bank and get a great experience, but if you choose the wrong financial products or use them the wrong way, you can wind up in a difficult spot. It’s much easier to manage your money well from the start than start on the wrong foot and fix money problems.

Schools don’t teach much about money, if they teach anything at all. That means it’s your job to make sure your kids know how to handle their money. If you’re a parent, it’s never too early to get started.


Teresa Staker
Teresa Staker
Administrative Assistant
p // 801-494-6047

Swedroe: What’s In A Fund Name?

Re-posted from

May 29, 2019

My last article was on dividend-growth strategies. One of its findings was that the returns to dividend-growth strategies were well-explained by their exposures to common factors, particularly the quality factor.

With that in mind, I decided to see how the exposures of the two dividend-growth ETFs we examined—the ProShares S&P 500 Dividend Aristocrats ETF (NOBL) and the Vanguard Dividend Appreciation ETF (VIG)—regarding the quality factor compared to the exposure regarding the quality factor of the iShares Edge MSCI U.S.A. Quality Factor ETF (QUAL), a fund that directly targets the quality factor.

The finding provides an important lesson for investors: You cannot rely on a fund’s name. What I found was that both NOBL and VIG had greater exposure to the quality factor than QUAL. Using Portfolio Visualizer’s regression tool, for the period August 2013 through March 2019, QUAL’s exposure to the quality factor was just 0.15, well below that of the 0.34 and 0.35 exposures, respectively, of the two dividend growth funds. Webinar

Sponsored by: 

Join Managing Director Dave Nadig and fixed income portfolio manager Chris Harms of Loomis, Sayles & Company as they discuss how investors should be thinking about their bond portfolios in the current environment. With central banks loosening around the world, a flat yield curve, and an uncertain corporate and political environment, figuring out exactly where and how much to allocate to bonds is far from obvious.

Speaker: Dave Nadig,
Guest: Christopher Harms, Loomis, Sayles & Company
Date: Thursday, October 24, 2019 – 3:00 p.m. ET

Fund Data

The table below shows the factor exposures for QUAL and allows for a comparison with NOBL and VIG. Note that the returns of all three funds are well-explained by their exposure to common factors.



We can also look at the returns and volatility of the three funds. Using the backtest portfolio tool at Portfolio Visualizer, we find that over the period November 2013 through March 2019, VIG returned 10.3% (standard deviation of 10.7%), NOBL returned 11.0% (standard deviation of 10.5%) and QUAL returned 11.8% (standard deviation of 11.0%). Again, we find nothing special about the performance of dividend-growth strategies.

The important lesson for investors is that, before you invest, you need to make sure the construction rules of the fund you are considering result in the amount of exposure to the factors you are seeking—as those exposures will determine the vast majority of the risk and return of the fund.

And, as the above example demonstrates, you cannot rely on a fund’s name to provide sufficient information to make that determination. You need to take a deep dive under the hood to be sure you are getting the exposures you desire.

Larry Swedroe is the director of research for The BAM Alliance, a community of more than 130 independent registered investment advisors throughout the country.

Teresa Staker
Teresa Staker
Administrative Assistant
p // 801-494-6047

Squire Wealth Mobile App Now Available!!


Squire Wealth Advisors is pleased to announce a significant addition to the future of our technology platform and advancement of the Squire Wealth Advisors client experience.  This new addition is our Squire Wealth Advisors’ mobile app.  This mobile app advances our new platform to deliver online access to updated account information, customized reporting features, and enhanced client service.  Ultimately, you will have greater access to your account’s information, as well as an advisory team that is more effectively equipped to provide solutions to your most complex financial challenges.

Please take a minute and go through the following steps to take advantage of this new feature:

Step 1.  Please go to your Itunes app store or Google play store on your mobile device and search “Squire Wealth” to find our app.  Be sure to search “Squire Wealth” to locate the correct mobile app.

Step 2.  We encourage you to log in to Your Squire Wealth Advisor Portal Login via the mobile app to view all features of your client portal.

It is our goal to provide on demand access for our clients so that they have constant transparency.  The transparency and timeliness of data provided by the Squire Wealth Advisors client portal give our clients a modern, user-focused experience.

We are excited that this new tool will provide you with a more comprehensive financial picture. Not only will this provide access for up-to-date portfolio balances, but the client portal also opens new opportunities for document and report sharing, communication, and a more holistic wealth management tracking.

If you have any questions about Squire Wealth Advisors client portal access, do not hesitate to reach out to us at (801)226-7722.

Warm regards,

Squire Wealth Advisors

Teresa Staker
Teresa Staker
Administrative Assistant
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Squire Wealth Advisors Market Commentary

October 2018

As of August 21, the longest-running S&P 500 rally (by some counts) was born out of “the ashes of the financial crisis.” Then came mid-September – ten years since the beginning of the financial crisis of 2008 – along with the usual flurry of “decade after” reflections. As of quarter-end, as reported by Morningstar, “Following a flattish first half, global equities enjoyed a fairly strong third quarter, with the Morningstar Global Markets Index now up 4.5% year to date.”

And yet … you may fret. Tariffs and trade war threats remain wild cards in the financial deck. A Brexit looms nearer and scarier. Emerging markets struggle while global leaders squabble. And, historically, many of the worst days in the markets have arrived in the fall.

When it comes to market forecasts, will the sky be falling soon, or are we set to soar some more? Have you been tempted to get out of “high-priced” markets while the getting seems good? Here are three compelling reasons to avoid trying to time the market in this manner.

  1. Markets (Still) Aren’t Predictable

Before you decide you’d like to stay one step ahead of a market that seems certain to rise, fall or head sideways, consider this quote from The Wall Street Journal personal finance columnist Jason Zweig: “Yes, 2018 is full of uncertainty and teeming with hazards that might make the stock market crash. So was 2017. So were 2016, 2015, 2014 – and every year since stockbrokers first gathered in New York in the early 1790s.”

  1. Economists Aren’t Wizards

A day rarely goes by when you can’t find one respected economist suggest we’re headed for a financial fall, while another opines that we’re going to keep going like gangbusters. Which is it this time? As one Bloomberg columnist reports, “a 2014 study by Prakash Loungani of the International Monetary Fund found that not one of the 49 recessions suffered around the world in 2009 had been predicted by a consensus of economists a year earlier. Further back, he discovered only two of the 60 recessions of the 1990s were anticipated a year in advance” (with “recession” defined in the referenced paper as “a year when output growth was negative”).

  1. You Can’t Depend on Your Instincts

Still thinking of trying to sell ahead of a fall? For this, and any other investment “hunch” you may have, your best bet is to assume it’s a bad bet, driven by your behavioral biases instead of rational reasoning. For example, loss aversion can trick you into letting the potential for future market losses frighten you away from the likelihood of long-term returns. Couple that with our oversized bias for seeing predictive patterns, even where none exist, and it’s all too easy to talk yourself right out of any carefully laid plans you’ve established for your wealth.

For these reasons and more, we’re here to advise you: Your plans aren’t there to eliminate uncertainty. They’re there to counter the temptation to succumb to it. As financial author Tim Maurer likes to say, “personal finance is more personal than it is finance.” We couldn’t agree with him more, so please be in touch with us personally if we can help you review your plans.

 Squire Wealth Advisors

Teresa Staker
Teresa Staker
Administrative Assistant
p // 801-494-6047