Orion's The Weighing Machine Orion Portfolio Solutions

In today’s episode, Rusty and Robyn talk with Ben Vaske, Investment Research Analyst at Orion Portfolio Solutions. They discuss current market conditions, The Weighing Machine podcast, digital assets, and plenty of podcast and book suggestions.

Key Takeaways

Five market factors to pay attention to for the remainder of the year: earnings, interest rates, valuations, liquidity, and technical.

The Weighing Machine Walk-Up Song Playlist is nearing three hours long, and is proving to be an eclectic mix.

Rusty’s take on popular TWM podcast questions: What makes a good financial advisor? What makes a good investment manager? What makes a good investor? How do investors tune out negative news?

Digital assets pose an exciting new opportunity for asset allocators, and Orion is working on educational materials for advisors and investors.

Rusty’s, Robyn’s, and Ben’s health and wellness tips!


Some of our favorite TWM episodes

Jeremy Siegel

Rob Arnott

Larry Swedroe

Daniel Crosby

Kostya Etus


Other podcast suggestions

Capital Allocators

The Meb Faber Show

Animal Spirits Podcast

RenMac Podcast

Fill the Gap: The Official Podcast of the CMT Assocation


The Prof G Podcast 

The Tim Ferriss Show

Ben Greenfield Fitness


Book suggestions

An Economist Gets Lunch – Tyler Cowen

What Money Can’t Buy – Michael Sandel

The Book of Joy: Lasting Happiness in a Changing World – Dalai Lama

A Guide to the Good Life: The Ancient Art of Stoic Joy – William B. Irvine

The Psychology of Money – Morgan Housel

Malcolm Gladwell


Our partners

Gregory FCA

Reverb Podcasting


Links 

Ben Vaske LinkedIn Profile

OPS Financial Advisor Success Hub

OPS Monthly Commentary

OPS Weekly Blog/Monday Bullets

TWM Walk-Up Song Playlist

Digital Asset Council of Financial Professionals (DACFP)

Tom Petty Learning to Fly

Wim Hof Method

Solutions Journalism Network


Connect with our hosts

Rusty Vanneman

Robyn Murray


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The world is changing and it's time to change with it. As global debt and inflation rise, how can investors navigate the challenges of the global economy?
In today’s episode, Rusty and Robyn talk with Dirk Hofschire, Senior Vice President of Asset Allocation Research at Fidelity Investments.
Prior to joining Fidelity, Dirk was a foreign service officer for the U.S. Department of State and a financial economist for the Bureau of Western Hemisphere Affairs. As he traveled the world, he developed an interest in economics.
Dirk talks with Rusty and Robyn about the risks of rising global debt, how investors can stay ahead of an unsustainably challenging economy, the business cycle, and other risks to the global economy.

Key Takeaways

[5:16] - Dirk Hofschire’s role at Fidelity Investments.

[6:58] - How multi-time horizon asset allocation works.

[8:18] - Why analyzing the business cycle is important.

[12:48] - Why debt has ballooned so much around the world in recent years.

[18:01] - What investors need to remember when dealing with a highly-indebted world.

[26:31] - How professional investment managers view government as a larger part of the global economy.

[35:24] - Dirk's perspective on digital assets.


Quotes
[19:12] - "Diversification is obviously the bread and butter for long-term portfolio building. But over the past 10 or 15 years, it would've been very easy to learn the opposite. If you had owned a US dominant 60-40 portfolio, that’s all you needed. So the diversification in part is against inflation, but it’s actually much broader than that. It's against the sort of extreme events with policy that could mean a much weaker dollar." - Dirk Hofschire
[27:54] - "When you think about government regulation and you just think about government policy being more involved in general, I'm not worried that the US is going to become a socialist country by any actual meaning of the term. But what I do worry about is when you sum up all the different things that are happening, all of those things have the potential to seep into reducing corporate profitability, potentially acting as a drag on growth, or potentially being more inflationary, but maybe not. But at the bottom line, it's hard to see how this is positive for profits." - Dirk Hofschire
[29:49] - Some of the things like shorter duration on the bond side, or on the stock side, commodities and traditional hedges, as well as some of the things like real assets, real estate and gold, and other types of commodities—those will all still be pretty good inflation hedges. Even if they get expensive, they should still hedge, somewhat, that surprise of potentially even higher inflation or greater inflation that's already priced in." - Dirk Hofschire

Links 

Dirk Hofschire on LinkedIn

Fidelity

Fidelity Podcasts


John Maynard Keynes 

Lords of Finance


Mike Duncan Podcast 


Connect with our hosts

Rusty Vanneman

Robyn Murray


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2901-OPS-11/13/2021

In today’s episode, Rusty and Robyn talk with Frank Nickel, Head of Quantitative Strategies and Investments at Brinker Capital.
Frank oversees the setup of the investment process that drives direct investing strategies and risk mitigation across various platforms at Brinker. Prior, Frank spent 27 years in various roles at Morgan Stanley—from asset allocation strategist to director of investment strategy to portfolio manager.  
Frank talks with Rusty and Robyn about the ins and outs of direct investing, the concept of “searching for alpha”, and the impact of direct investing on the future of investing (especially with ETFs).
“We have the ability to give investors a high price momentum, a version of our direct indexing strategies that allow them to have that ‘search for alpha’. I think the way traditional people think about the ‘search for alpha’, it’s at the individual security level. We are not going to really attempt to provide that. Our search for alpha is providing some type of factor exposures that investors believe can outperform.” ~ Frank Nickel

Main Takeaways 

With a direct indexing strategy, you may see bigger returns, compared to a traditional separately managed account.

Direct indexing has been on the roll because of tech innovation. From high-net-worth individuals to the mainstream area, firms can manage to bring it to smaller accounts.

Direct indexing won't kill ETFs. The only two viable reasons for ETFs to fail are if the government changes taxation, or if technological evolution can lower direct indexing's minimum.

Fractional shares trading might be the future with how tech is evolving right now. This can also help to bring the account minimums down.

Searching for the alpha involves investing in areas of the market that are projected to outperform. Right now, there's a growing interest in biotech and cybersecurity.


Links

Frank Nickel on LinkedIn

Brinker Capital

September by Earth, Wind, and Fire

Morgan Stanley Wealth


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Rusty Vanneman

Robyn Murray


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2742-OPS-10/27/2021

In today’s episode, Rusty and Robyn talk with Simeon Hyman, Global Investment Strategist at ProShares.
From the initial idea of an ETF to product development to the roll-out, Simeon creates—and even customizes—a smooth product strategy to ensure every client and prospect understands the ETF's scope. Prior to creating successful ETFs with ProShares, Simeon held investment leadership roles at Bloomberg Wealth and UBS.
Simeon talks with Rusty and Robyn about all things Bitcoin Futures ETF, and the rationale behind its advantage over Bitcoin or other altcoins.
"Bitcoin’s a volatile thing. Nobody can tell you it’s not. And our ETF, BITO, delivered. That volatility in itself is a ‘feature’ from our perspective, not a bug. There are fewer and fewer things that don’t approach this kind of correlation, so finding something that behaves differently is a very valuable diversifier.” ~ Simeon Hyman

Main Takeaways 

Bitcoin is volatile, but it can be a great inflation hedge and diversifier. Through Bitcoin ETFs you can gain Bitcoin exposure while maintaining a well-performing portfolio over time.

The value of a digital asset will greatly differ depending on how a person uses it. For investors, they keep watch on how it will compete in their investment portfolio. For a typical cryptocurrency user, it's just another modicum of exchange.

BITO recognizes Bitcoin and other crypto volatility. With the advent of a regulated futures market, it's easy to appropriately place Bitcoin in your portfolio.

The cryptocurrency market is unregulated by nature, so there’s no safe and tactical approach on how to invest in Bitcoin and it would be difficult to speculate and diversify with altcoins.


Links

Simeon Hyman

ProShares

ProShares Bitcoin Strategy ETF (BITO)

Bitcoin

Triumph - Magic Power

Bloomberg Wealth

UBS

Lehman Brothers


Connect with our hosts

Rusty Vanneman

Robyn Murray


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2742-OPS-10/27/2021

In today’s episode, Rusty and Robyn talk with Mike Van Wyk, Vice President of Research and Insights for Capital Group.
Mike has studied human behavior throughout his two-decade career to better understand what truly drives consumer behavior and business growth. Whether it be packaged goods or financial services, Mike brings game-changing insights to the table. His research helps others skyrocket the growth of their business or their professional career.
Mike talks with Rusty and Robyn about the difference between a “sage” and “caregiver” advisor and the three success factors of existing high-growth firms.
"Every financial professional has to have a side that's more quant-focused and can talk the numbers, but you also have to be able to connect emotionally with your clients and be there as a support for them. Those who are most successful are those who understand there's an aspect of being a sage that they need to bring to the job daily, and there's an aspect of being a caregiver that needs to be present there as well.” ~ Mike Van Wyk

Main Takeaways 
Three success factors of the highest growth firms are the always-on acquisition factor, relationship alpha, and strategic skills. All habits, behaviors, and practices during client engagement should be refined to achieve high performance and increase revenues.

Spend more time on high-value business activities. Advisors easily get distracted with small tasks, when they should be spending their time on growth creation.

Advisors need help, too. It's best to tap into resources about advisor-client engagement that are backed by robust data.

There are two types of advisors: the ‘sages’ who like numbers and the ‘caregivers’ who like helping people. An effective advisor has to find a balance between these two.


Links
Mike Van Wyk on LinkedIn

Capital Group

PracticeLab

Coca-Cola

Walmart

Proctor and Gamble

Capital System

Pathways to Growth: Advisor Benchmarking Study

Noise: A Flaw in Human Judgment by Daniel Kahneman

What Retirees Want: A Holistic View of Life’s Third Age by Ken Dychtwald

Hidden Brain Podcast


Connect with our hosts
Rusty Vanneman

Robyn Murray


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2731-OPS-10/25/2021

In today’s episode, Rusty and Robyn talk with Maria Quinn, national spokesperson and thought leadership ambassador at Vanguard.
Maria provides her expertise in Vanguard’s largest business line by working externally with financial advisors and intermediaries. Before starting her journey with the firm, Maria was involved with non-profit organizations that provide marginalized people with access to education. 
Maria talks with Rusty and Robyn about what causes the behavior gap in investing, how human psychology and behavior affect financial success, and how we can use the Advisor Alpha model and the “Three P’s” framework to foster long-term relationships with clients.
"The way we think about planning is having those deep conversations with clients that require a lot of trust. We define their values (what is of greatest importance to them). And then, we find a way to translate them into a goal.” ~ Maria Quinn

Main Takeaways 
With the help of an advisor, a client's chance of achieving financial success is significantly higher. In addition, according to Advisor's Alpha, there are seven key areas improved through best practices, which increases your value up to three percent.

Behavioral coaching practices should focus on investment management and wealth management to help improve client retention.

Every investment outcome is heavily driven by psychology and human behavior. Factors like overconfidence, recency bias, and over-competence should be avoided if you want rational and perfectly timed decisions.

Providing a financial plan is foundational. Use the “Three P’s” framework as a guide. Plan thoughtfully, be proactive, and imbibe positivity.

Global equity investing has the following benefits: diversification in the portfolio, mitigation of some potential volatility, and increase in portfolio exposure.


Links
Maria Quinn on LinkedIn

Vanguard

George Washington University

Good News: There’s a Labor Shortage. By David Autor | New York Times

Nessun Dorma by Luciano Pavarotti

John Bogle

Teach for America

Bain & Company

Deloitte

2021 Value of an Advisor Study | Russell Investments

Alpha, Beta, and Now...Gamma | Morningstar

The Value of Gamma-Efficient Portfolio | Morningstar

The Essential Advisor: Building Value in the Investor-Advisor Relationship by Bill Crager and Jay Hummel

2021 Quantitative Analysis of Investor Behavior - Variable Annuities ("QAIB-VA")

‘Mind The Gap’ | Morningstar

Richard Thaler

Putting a value on your value: Quantifying Advisor's Alpha

JP Morgan

Twitter

Financial Times

The Economist

The Wall Street Journal

TheNew York Times


Connect with our hosts
Rusty Vanneman

Robyn Murray


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2651-OPS-10/13/2021