Happy 1st Birthday Bps!
The blog turned one year old last week and in case you were wondering – yes, I celebrated by smothering my computer monitor with a smash cake.
When I decided to launch bps and pieces in early 2016, I really didn’t know what to expect.
- Would anything I write really be unique or differentiated enough relative to the plethora of amazing (free) content already out there?
- Knowing how many blogs I read on a regular basis, did the world really need another one or had the market already reached a saturation point?
- Could I develop a following or would I quickly be relegated to also-ran status?
I am happy to report that my experience throughout this first year of blogging has been one of the most fulfilling things I have done in my career. Have all of my posts been A+ material? Hell no. Several were met with crickets. But there were also a handful that seemed to resonate with folks. I can only hope for more of the latter going forward.
Josh Brown wrote a post a couple of years ago celebrating the seventh anniversary of his own blog, The Reformed Broker. In it, he wrote:
The intent of this blog was always about discovery and learning, for both readers and myself.
I would echo Josh’s sentiments entirely, but I’d add one additional intent: connection.
For existing and prospective clients of Huber Financial Advisors, it has served as an additional platform from which to communicate our investment philosophy, provide perspective throughout meaningful economic and market events, and address common questions or concerns.
On a more “selfish” level, the blog has afforded me the opportunity to connect with so many people that I admire in our industry, several of whom I now consider friends. It became apparent fairly quickly that the world of investment blogging was not one of competition, but rather community. I have been blown away with how kind, generous and honest other bloggers have been with their feedback and their willingness to share my content with their own readers.
As luck would have it, the week of my first blogiversary coincided with the “Blogger Wisdom” series at Abnormal Returns. This is an annual tradition in which the site’s founder, Tadas Viskanta, asks a series of provocative questions to a esteemed group of independent finance bloggers. To be included among such a talented and insightful group of investors and writers was truly humbling and only reaffirmed that embarking on this project was – and will continue to be – a worthwhile endeavor. With that, I’ll leave you with my responses to the five questions that we were asked to answer (Click on each question to be taken to the full post with all the others’ responses as well!)
Hindsight is a hell of a drug.
Even if the trend towards passive investing slows down, it’s hard to imagine it completely switching direction anytime soon. Many active managers have argued that too much cap-weighted indexing would be bad for markets, leading to massive distortions in the absence of their price-setting activities. Others, including AQR’s Cliff Asness and pseudonymous-blogger Jesse Livermore, have written at-length on the counter-argument – that an increase in indexing could make markets more efficient.
While we all (I think) would agree that zero active management would be a troubling (and odd) scenario, it remains to be seen whether or not there is such a thing as “too much passive.” A thousand years of data would likely see a real-world test as to whether or not there is an upper-bound to the amount of indexing that can occur while still allowing capital markets to properly function.
Question: Ten years hence, what we will be embarrassed by that we were excited about in 2017?
Fidget spinners.
Question: If you could (magically) impart one piece of wisdom to all investors what would it be?
Focus on the entire pie instead of the individual slices. The concept of diversification can be a beautiful thing, but only when used properly. Ignoring the recent losers in a portfolio – particularly when there are a handful very big winners – is a daunting task for most investors. It’s easy to get lulled into thinking that a perfect portfolio exists, consistently firing on all cylinders. Sadly, such a portfolio only exists in Lake Wobegon, where all the line-items on your brokerage statement are above-average. Remember that diversification is always working, you just won’t always like the results. If all investors could learn to appreciate this as a feature and not a bug, we would likely see improved investor outcomes and less performance chasing.
Question: What’s the one thing investors should do to simplify their lives?
Delete entirely, or at the very least turn off notifications from, all finance and investment apps on your phone. Most daily news events in financial markets will have zero impact on your long-term financial well-being. This constant inundation of irrelevant information is almost guaranteed to give investors a bias towards action, to the detriment of their own success.
About the author
Phil Huber, CFA, CFP®
Phil is the Head of Portfolio Solutions for Cliffwater, a leading alternative investment adviser and fund manager. Prior to joining Cliffwater in 2024, Phil was the Chief Investment Officer for Savant Wealth Management, a multi-billion dollar wealth management firm. Phil has been involved in the financial services industry since 2007. He earned a bachelor’s degree in finance from the Kelley School of Business at Indiana University. He is a member of the CFA Society of Chicago. More about me here. Twitter: @bpsandpieces
Get on the List!
Sign up to receive the latest insights from Phil Huber directly to your inbox.