Personal Wealth Management / Expert Commentary

Ken Fisher Explains How and When to Do an Investment Portfolio Review

Ken Fisher, Fisher Investments’ founder, Executive Chairman and Co-Chief Investment Officer, shares his perspective for investors on how and when to conduct a portfolio review.

Transcript

0:03
you know about the worst thing most
0:04
people can do
0:06
is to pay attention what happens to
0:08
their portfolio every day
0:10
uh it's a little bit like saying that
0:12
you should be paying a lot of attention
0:14
to
0:15
happens to the second hand of a clock
0:19
it's just going to keep you away from
0:20
things that are more important
0:22
the reality is for most people they
0:25
don't need to check their portfolio too
0:27
often
0:29
uh
0:31
and of course that is going to vary to
0:33
some extent based on who you are or who
0:36
any person is
0:38
but
0:39
in in a very simple sense
0:42
the best time to actually
0:46
think about a year-end checkup on your
0:49
account
0:51
on your portfolio on your investments
0:54
is actually not at your end
0:57
the reality that i learned
1:00
when i was a kid
1:01
is that the
1:04
calendar year
1:06
is kind of artificial
1:08
in reality almost all real projects in
1:10
the real world
1:12
go on over a much longer period than a
1:14
year and particularly not associated
1:17
with a calendar
1:18
year
1:21
taxes are done on a calendar year basis
1:24
and you get a lot of people in december
1:28
trying to take tax losses
1:30
to
1:31
minimize the tax effect for the next
1:33
year
1:34
and one of the worst things you can do
1:35
is to try to take tax losses right when
1:37
everyone else is taking tax losses
1:39
because you're trying to sell the same
1:41
things that they're trying to sell just
1:43
when they're trying to sell them
1:45
so you tend to sell low and then have
1:47
the things that you would want bounce
1:49
back before you can get to them after
1:52
the mandatory
1:54
weight before you can buy them back
1:57
the best time to think about these
1:59
things is to create your own sort of
2:01
fiscal year end
2:04
for planning purposes that's in the
2:06
middle of the calendar year
2:08
and to take your tax losses
2:11
in maybe the late summer
2:14
kind of the notion of buying your straw
2:18
hats in the winter and your skis in the
2:20
summer
2:21
to take advantage of the fact that
2:23
people aren't doing tax law selling then
2:26
and then you want to review your
2:27
portfolio to make sure it's still
2:28
consistent with your longer term needs
2:31
because really the only purpose of your
2:32
portfolio in the first place is what are
2:35
you trying to accomplish in the long
2:36
term and for most of you the long term
2:39
is longer than you can feel emotionally
2:41
and once a year is a good time to go
2:43
back and say what's really important to
2:44
me what are my goals what am i trying to
2:46
accomplish where do i want this
2:50
set of investments to take me in the
2:53
longer term and why
2:54
and
2:55
that's one of the most basic financial
2:57
planning questions you could ever ask
2:59
and is worth to think through from the
3:02
beginning
3:03
sort of once a year again maybe at that
3:05
same time
3:06
uh when you're not distracted by
3:07
holidays when you're not distracted by
3:10
what it what to get as a
3:12
present for your grandchild or or your
3:14
sister or your spouse
3:17
it in the calm of a quiet time to think
3:20
through what is it that i really need
3:21
these to do for me in the long term
3:24
and
3:25
then once you're comfortable that
3:27
nothing's changed in your life in the
3:28
year that would change that
3:30
and you're comfortable with what you've
3:32
done relative to minimizing tax impacts
3:35
you've pretty much done the job
3:37
thank you for listening
3:39
subscribe to the fisher investment
3:40
youtube channel if you like what you've
3:42
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3:44
soon as we publish new videos
3:50
[Music]
4:04
you

 

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