Mountain Vista Wealth Management
Guiding from Valley to Peak
Most Americans know that Social Security provides retirement benefits, but many are unaware of the program’s full scope and the various benefits available. From spousal benefits to disability coverage, Social Security offers financial protection that extends far beyond what many people realize. This article explores some lesser-known aspects of Social Security that could significantly impact your financial planning. [Read more…] about Social Security: Beyond the Basics
“The markets take the stairs up and the elevator down.”
– Tim Egart
While the stock market has historically delivered impressive 9-10% long-term returns, many investors fail to capture these gains. When market conditions deteriorate, prices adjust rapidly, making it challenging to exit declining positions during negative news cycles. More critically, selling after a market decline can erase years of accumulated wealth. [Read more…] about Q1 2025 Investment Letter
In recent years, some investors have questioned the merit of diversification during the prolonged U.S. tech-dominated bull market. With American tech giants delivering extraordinary returns, international investments sometimes seemed unnecessary. Furthermore, rising interest rates created a scenario, in 2022, where bonds failed to provide their traditional protection during stock market declines.
However, 2025’s market volatility offers a powerful reminder of why diversification remains a cornerstone principle of sound investing. [Read more…] about Case Study: The Value of Diversification
“Invest for the long haul. Don’t get too greedy and don’t get too scared”
– Shelby M.C. Davis
As we enter 2025, let us take a moment to reflect on the truly amazing investment period that we have just lived through. The S&P 500 and Nasdaq 100 delivered total returns of ~25% in 2024, following gains of 26% and 54% in 2023 – culminating in two-year returns of 58% and 92%, respectively.
Now that we are feeling good, we should reflect on the conditions that set up such tremendous gains. 2022 was one of the most difficult investment periods of my career. The S&P 500 lost (-19%) over the year (with a peak draw down of (-25%) from its 2021 high) and the Nasdaq 100 lost a third of its value over the year. Even bonds offered little shelter, with the Bloomberg U.S. Aggregate bond index losing(-13%), including dividends, and suffering a peak loss of (-17%). [Read more…] about Q4 2024 Investment Letter
INTRODUCTION“Everybody has some information. The function of the markets is to aggregate that information, evaluate it, and get it incorporated into prices.”
– Merton Miller, Economist and Nobel Laureate
At Mountain Vista, we periodically remind our clients that the market is forward-looking and by the time you are reading the latest clickbait article, the stock market has already reflected that information. With the increased availability of data and the adoption of quantitative, machine-driven trading strategies, the market reacts to new information almost instantly. In the stock market, information is reflected through a new price.
While this new technology and market structure present opportunities for very sophisticated trading firms that rely on being a fraction of a second faster than their competition, a typical saver could get themselves in trouble by selling after bad news or buying after good.
The unwind of the Japanese “carry trade” on August 5th reminded us once again how fast markets move these days. Over three trading days, the S&P 500 fell (-8%) and the VIX, a measure of expected volatility, reached levels only experienced during crises like the COVID crash in 2020 and the global financial crisis in 2008/9. In a little over a week, the market recovered all of these losses. I feel for the folks that turned on CNBC, read a few panicked headlines and hit the sell button. [Read more…] about Q3 2024 Investment Letter