2012 Investment Letter Archive

December 2012
THOUGHTS ON THE U.S. FISCAL CLIFF
The single biggest issue in the news today for investors is the imminent fiscal cliff at year-end. The fiscal cliff is the combination of tax hikes and spending cuts that are scheduled to take effect on January 1, 2013… >more

November 2012
RISK MANAGEMENT IN WEALTH MANAGEMENT
What are the biggest risks to your investment portfolio? Many investors are worried about a stock market correction, economic recession, global credit crisis, or rising tax rates. Which risks are you most exposed to and which are you most worried about?… >more

October 2012
THE HEDGE FUND MIRAGE
The hedge fund industry has grown tremendously over the past 20 years. There is a certain “snob appeal” of investing in hedge funds that puts one in the exclusive class of a wealthy and sophisticated investor of which “retail” investors can only dream… >more

September 2012
PROACTIVE “BUY AND HOLD” INVESTING?!
Some people are convinced that investment strategies that are called “buy and hold” or “passive” must be rigid or stagnant, and unresponsive to today’s opportunities and global economic conditions. At Adam Smith Advisors, nothing could be further from the truth…. >more

August 2012
BIG TAX INCREASES LOOMING
President Obama’s healthcare plan was recently ruled constitutional by the Supreme Court. That means the Medicare surtax will go into effect in January. There are also many other tax increases set to take effect in January on income, dividends, capital gains, payroll and estates unless Congress acts by year end… >more

June 2012
LOW VOLATILITY EQUITY FUNDS
Some low volatility stock funds offer equity market exposure, with less risk. Historically, the returns of lower volatility stocks have often been about the same as the overall stock market, while the risk has been substantially less… >more

May 2012
ANOTHER LOUSY YEAR FOR ACTIVELY MANAGED FUNDS
An amazing 84% of actively managed U.S. equity mutual funds lagged the overall composite stock market index in 2011. That is the worst one-year performance in the 10 years that Standard & Poor’s has been keeping track… >more

April 2012
HOW DOES WARREN BUFFETT DEFINE RISK? HOW DO YOU?
What is your definition of risk? Most people think of investment risk as the probability of a sudden 20%+ loss in the value of their investment portfolio… >more

March 2012
TIMELESS INVESTMENT WISDOM
These timeless bits of investment wisdom are as true today as they were 100 or 1000 years ago, and we think they will still be true 100 years from now. People who follow these simple common sense ideas will be far ahead of those who do not… >more

February 2012
THE CASE FOR EMERGING MARKET STOCKS
We think it is smart to look around the world and invest where the growth prospects are best. Emerging market stocks look very interesting to us now and we believe their prospects are bright over the next 10 years… >more

January 2012
2012 GIFTING OPPORTUNITY
2012 is a good year for wealthy families to consider gifting significant assets to their children. This is especially true for Minnesota residents. Why now?… >more