Now, more than ever, planning is a powerful tool to help investors succeed and achieve better outcomes. The table below highlights the benefits of planning taken from a study on retirement planning among Americans over age 50, over a wide range of market conditions. The results show that having and sticking to a plan results in three times the net worth when compared to those who don’t have a plan.

One of the underappreciated aspects of active management is the ability to build a well-curated portfolio of mutual funds that pursue unique investment strategies. The chart below shows the aggregate performance of ten active US equity strategies over the last thirty-eight years. Allocating to the top strategies and avoiding the bottom strategies can dramatically improve long-term performance.

Even though we all know market fluctuations are a normal part of equity investing, large market declines can be scary because they often happen rapidly and feel random.

There are floods of COVID-19 market commentaries on how the virus and government responses will impact the economy and the market. For long-term investors, it’s hard to know what to make of them all. Taking a deep breath and stepping back by reframing with a longer term perspective can help investors avoid costly mistakes. Every decade has its challenges, but even with a myriad of setbacks, the average decade-return over the period below was 204%, so tune out the noise and stick to your plan

It’s only natural for someone invested in a poorly performing active equity mutual fund to wonder if it’s time to make a change. Should an investor sell a fund if it trails its benchmark for a year? Three years? Five years?

Investment time horizon is a critical concept in building wealth. Most investors have very long investment time horizons, typically decades or more. Investment managers also require long time horizons to deliver on their investment thesis.