March madness and mad money

The season is upon us. Every year, countless hours are spent (or wasted) across corporate America trying to figure out the NCAA basketball tournament bracket. Some people will do extensive research, dig into analytics, look at what teams the professionals are picking and figure out their best bang for the buck with their own scoring system. Others will fill out a bracket in less than two minutes or make picks based on some simple metric, like what team mascot is better. In the end, it’s just a game of chance. It’s gambling. If you win, it’s dumb luck. If you lose, it’s dumb luck as well, just the wrong kind of it. Nobody has it all figured out.

Oftentimes, many people think of the investment world in these very same terms. It seems like a game of chance. You can do some research, or you can refrain from it. You can follow what other people are doing. In the end, you make your picks and hope for the best. It feels just like the March Madness brackets and gambling. But is that view actually true?

Clearly, the answer should be no; however, as a result of the actions people often take, the answer can, unfortunately, be yes. Why is that? Because you may:

  • Try to find a “sure thing” based on a hot tip. For example, “My dentist just made a killing on a health care stock. I should do that, too!”
  • Rely on recent trends to predict what’s going to happen in the future. Oil prices have been dropping, so they should keep going down, right?
  • Believe that “It’s different this time.” This type of thinking often causes us to shake off a cold reality. We know market timing doesn’t make sense, but when the next new event comes up, like North Korea and its nuclear testing, we say this has never before happened and discard whatever the past tells us.
  • Think professionals have “special” insights. You might believe that if someone is an investment professional, they have the ability to outsmart the markets. Their crystal ball can be cloudy, too!
  • Focus on players and not the team. You may consider a particular investment and not the portfolio as a whole. As in basketball, you can think of who has the best player versus who has the best team.
  • Make “all or nothing” bets. You feel that the market is going to go down, so you move all to cash. That means you are 100% confident the market can go absolutely nowhere but down. Are you that sure?
  • Don’t look for evidence that contradicts what you have found to be true. You make a decision and instead search only for evidence to back you up and make you feel even more confident.
  • Try to recover your losses quickly. Many people say, “I lost money last year, so to get back on track, I need to do better this year.” The problem here is that you try to exert control over the markets, which by their nature are uncontrollable and unpredictable. The markets may give back, but it takes patience.
  • Don’t always understand (or accept) that sometimes it’s okay to lose money. In fact, it’s fully expected. You never win them all. But it’s like the NCAA regular season: You don’t need to win them all to get into the big tournament.

Stick to your game plan

On the contrary, a successful investment strategy looks much different than the above. Instead of relying on short-term guesses, hot tips and emotional responses, we recommend you rely on long-term strategies that your CI Wealth Advisor has created to help meet your financial objectives.

So, as you look at your investment portfolio, think about not just what has happened this week, this month or even this past year. Instead, think about the long-term strategy you have in place. That’s the strategy of putting together a winning team over time. Remember that investing has its ups and downs—it won’t always be a slam dunk.


Chad Carlson, CFP, CFA

Chad Carlson, CFP, CFA

Partner, CEO & CIO

Chad understands that staying stagnant is not in the best interest of the firm’s clients. The firm cannot be reactive and needs to approach clients with transparency and trust. That’s why he believes in a straight, heartfelt approach to business.

After a 15-year career as a wealth advisor, Chad assumed the role of Chief Executive Officer and Chief Investment Officer in 2020. As part of these roles, he’s working to enhance the firm’s vision and laying out where the firm is going in the future. This includes working with CI Financial to build upon the firm’s current strengths, expand its geographical reach, and to bring to fruition the strategic reason firms came together as part of CI Private Wealth. By aligning with CI, Chad works to ensure team members and clients have a long-term partner that can enhance opportunities for all.

When people trust their investments to us, they want to know that consistent thought and care was put into their personal portfolio. As CIO, Chad leads the CI BDF’s investment committee to put the firm’s top thinking to work to develop the best solutions for clients. With a team that looks at portfolio options daily, he aims to ensure clients that they are positioned for better long-term outcomes.

Before joining the team, Chad spent two years with Goldman Sachs’ private wealth management subsidiary, Ayco Company LP. Performing personal financial planning and preparing individual and trust tax returns for Fortune 500 executives gave him insight into estate planning, corporate benefits, and tax planning.

A CERTIFIED FINANCIAL PLANNER™ and a Chartered Financial Analyst®, Chad has been quoted in The Wall Street Journal, Forbes, Financial Times, CNBC, LA Times, Smart Money, Dow Jones Newswires, Business Insider, and Investment News. Chad earned a Bachelor of Science in finance from Valparaiso University.

Not one to sit back, Chad won’t let the firm take a reactive role as he proactively works to make the firm stronger for all its stakeholders.

To learn more about how the firm helps its clients enjoy a full life, contact Chad today.


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