John Swolfs is CEO at Inside ETFs. Previously, he worked at BlackRock’s, one of the world’s largest asset managers, iShares team as a business development associate. In his previous role, Swolfs worked closely with both the Registered Investment Advisors (RIAs) and Independent Advisor community to help promote the use of ETFs and index investing. Before joining iShares, he worked as a financial advisor at Merrill Lynch. Swolfs is a graduate of SUNY Albany, where he majored in U.S. history. And a little bit of trivia, John worked for two years for the New York Mets.
“Before you invest, get professional help. It's out there, it's accessible, take advantage of it.”
John Swolfs
Worst investment ever
John’s worst investment happened when, despite being an expert in investing, he started believing that he could time the market.
The financial advisor who wouldn’t listen to his advice
John is always talking to his clients about thinking long-term and investing for the future. He has always advised them to do what's right for their portfolio and not to worry about what's happening in the market.
He, however, took all of that knowledge and information and said that it was not for him. He ditched his thinking and decided to get tactical. He believed that he was smarter than anyone, i.e., that he was smarter than the market.
To his clients, he would have told them that they can't do that, that that's foolish. That they need to build a position that allows them to be diversified and ride the markets out. But when it came to himself making the investment move, he thought he didn’t need to follow his own advice.
Buying gold in a murky market
John invested in gold in 2012, a time when there were a lot of concerns about inflation as the world was still not out of the global financial crisis.
Against his better judgment, he bought $15,000 worth of gold, believing that the market would eventually pick up. The price of this investment has been going down since the day he bought it. It still pains him to have foolishly lost all that money.
Lessons learned
Stick with your allocations
If you are building a strategic plan for your asset allocation, stick with it.
Avoid personal bias
Don’t let personal bias or emotional attachment get you stuck with an investment for too long.
Diversify your portfolio
Opportunity cost is real when it comes to investing. Build an allocation that allows you to be diversified and ride the markets out.
Don't ever think that you're smarter than the market
You’ll never be smarter than the market, so always do your homework, and don’t forget your risk management lessons.
Andrew’s takeaways
Fear is dangerous when it comes to investing
Fear can be very dangerous and can hold you back from making solid investment decisions. When you start building a scary scenario of what could be happening in the markets, you start getting confirmation bias. You only find research and people talking about the bad scenario. You’ll keep building upon this fear, and you can easily get caught up in it and end up being driven by emotion or flawed thinking.
Equity should be your core asset
Build up your investment account over 20, 30, or 40 years and diversify across asset classes, such as commodities, fixed income, etc. This way you’ll be able to manage your cash flow as well as the movement of your overall portfolio.
Actionable advice
Get help from a financial advisor. Go to a professional who will keep you on track and guide you on the best way to invest your money.
No. 1 goal for next the 12 months
John’s main goal for the next 12 months is to get all his asset allocations consolidated. He wants to hire a wealth management advisor or a Robo advisor, who will get him back on the right path. Currently, his assets are scattered all over the place.
Parting words
“You can't control the market. So control what you can, and that's typically cost, taxes, and risk. And if you do that, you'll be ahead of the game. Control what you can and let the markets do their thing.”
John Swolfs
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