Life is complicated, especially in today’s COVID-19 environment. You’ve worked hard. You’ve saved and captured your stellar earnings along the way. Naturally, you want to put your savings to good use. Your investment portfolio is no doubt an important driver of achieving your overall financial plan. If you’re anything like me, you want your investment portfolio to be as high-achieving as you are.
You seek out a winning investment strategy to convert your hard-earned dollars into durable wealth so that you can achieve all that’s important to you. Well, at Cogent, we start and end with the evidence. Choosing an investment philosophy based on 60 years of objective, peer-reviewed research on how markets work. We are enthusiastic advocates of financial science and you should be too, but be warned, we know there will be times when looking to the science is not always easy.
Here’s an example. We see there is pervasive historical evidence for investing in value stocks. The evidence shows us that value stocks have outperformed growth stocks by a little more than 4.5% annually in the US since 1928. Recently, growth stocks like Amazon, Apple, or Microsoft, have enjoyed a run of out-performance, versus their value counterparts, companies like AT&T, Comcast, and Verizon. Investing in these value companies has been challenging.
We’re well aware that there will be disappointing periods like these, but the principles that guide us towards value investing remain the same. While past performance is not guaranteed, the science serves as our guide and suggests that value investing continues to be a reliable way for investors to create high-achieving portfolios. When investing is challenging, we challenge you to remain committed to the science. Don’t manage your financial future all on your own.
Experience a smarter way to invest with a financial plan infused with decades of evidence-based research. Sit down with Cogent’s fee-only wealth managers today, someone who acts in your best interest and serves as an educator of financial science. We’ll share our insights with you and help you with your plan every step of the way.
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