Our newest team members, Jackson Baltz (JB) and Noah Wolfe (NW), sat down with Dave (DM) and Christian (CM) to ask some questions surrounding the market. Read the full conversation below:
JB: We’ve seen major bond indexes and gold – typically considered safe-haven investments – decline in value amid ongoing conflict. What are your thoughts on this, and how can investors diversify and hedge market risk in this environment?
DM: We’re not trying to predict where gold, oil, or interest rates are headed. It’s generally understood that when interest rates rise, bond prices fall; and bonds, especially over the past 5 to 15 years, haven’t been a strong investment. Our focus is simply on ensuring people have reliable sources of income during market disruptions, rather than attempting to time the market.
CM: When you look at the market and your account values over the past few years, there’s been significant growth, and we’re still well ahead despite recent volatility, which is to be expected. History shows that even through wars and conflicts, markets experience short-term disruption but continue to move forward over time. That’s why we focus on having a plan for volatility and don’t rely on bonds or gold as primary growth assets.
DM: We’ve been doing strategy reviews with clients this quarter, and while the news can make things feel worse than they are, a closer look at the numbers shows that portfolios and plans remain relatively stable. It’s when investors try to jump between sectors or time assets like oil and gold that they tend to introduce more volatility into their investments.
JB: What role, if any, should cryptocurrency play in a long-term financial plan? With all the buzz and frequent swings in value, how should investors think about its volatility and whether it truly fits into their strategy?
DM: Crypto tends to generate a lot of attention because of its extreme volatility; large drops and rapid gains drive headlines and emotional reactions. With so much uncertainty around its long-term role, that same volatility makes it difficult to treat as a stable component of an investment strategy.
CM: Crypto won’t be viewed as a true currency until it shows more consistent stability over time. Because of its volatility, it’s generally not something to hold in large amounts in a long-term portfolio, especially if you don’t fully understand how it works.
DM: I always go back to a simple example; no one wants to sell a car for $50,000 on Friday if that currency could be worth $40,000 by Monday. If our everyday currency fluctuated like that, people wouldn’t use it, and that’s the challenge Bitcoin still faces.
NW: With growing demand for AI and AI-related stocks, there’s been talk of a potential bubble—do you think that’s a real concern? If so, is it comparable to any previous market bubbles we’ve seen?
CM: I think AI and technology valuations have risen to fairly high levels, driven by strong growth and returns over the past several years. It really comes down to exposure—making sure you’re not overly concentrated in one sector, since bubbles and volatility can happen, and managing that risk within your portfolio.
DM: There’s always a risk of bubbles and overvaluation, especially when you concentrate too heavily in one sector, so it’s important to watch for overlap across funds and holdings. Our focus is on owning high-quality, established companies that can adapt and acquire the tools they need, rather than trying to pick the next AI winner.
How can we best be prepared when we see market volatility related to global conflicts or current events?
CM: The best way to be prepared is to have assets set aside to cover your income needs for the next 3–5 years. Right now, markets are still relatively stable compared to the start of the year, so there’s no immediate need to tap into those reserves. It’s something to keep monitoring, especially if we see a more prolonged or deeper downturn.
DM: You don’t need to predict the future to build a strong retirement income plan—you need one that accounts for market volatility and can adapt to changes like tax laws and geopolitical events. So far, volatility has been relatively low compared to past market events, even though headlines may make it feel worse to drive attention and clicks. The key is to stay focused on your plan, consider the source of what you’re hearing, and trust that your strategy is built to handle these fluctuations.
This material is for educational purposes only and is not intended to provide specific advice or recommendations for any individual and does not take into consideration your specific situation. There is no assurance that the views or strategies discussed are suitable for all investors or will yield positive outcomes. Investing involves risks including possible loss of principal. Be sure to consult with a qualified financial advisor, legal, and/or tax professional before implementing any strategy discussed here.