Apple flirts with one trillion, and Facebook disaster: a modern tale of two cities

It’s been a week full of ups and downs when it comes to tech so let’s dive in and take a closer look. When it comes to investing there can be some pretty high highs but remember that they also mean there can be some low lows. We’ve written on risk before so it’s nice to see an actual application clearly displayed in the news.

Let’s get to it.

A tale of two cities

Let’s just say it, Apple is killing it.

Apple (AAPL) and Facebook (FB) stock news certainly hijacked the headlines this past week providing market prognosticators with plenty to talk about. As Apple reached a Trillion-dollar valuation fueled by earnings results it is interesting to look at the stock performance over the past year. July 2018 $150, with a sluggish rise until the February sell-off, and a volatile path that mirrors the market to settle at $198. The one-year chart on Facebook tells another interesting story. $169 a year ago, followed by sluggish growth and the February sell-off, then optimism and enthusiasm that they weathered the privacy concern which drove the stock up to

A new high of $218 last week only to sink back to $174. For all the news about changing algorithms, the end of social media impact, the Russian hackers, and privacy rules, Facebook has produced a 3% return over the past 12 months.

The question is what will AAPL and FB be a year from now. The answer is, I don’t know, and all the so-called experts don’t either, no matter what stories they tell on golf courses or on CNBC. These two stocks do illustrate the volatile and potential danger of having a concentrated part of your portfolio in a single stock and the challenges of market timing.

Don’t worry about a thing

‘Cause every little thing is gonna be all right.

Tech is a pretty wild industry, the days of the dotcom bubble are over but we still see pretty stark contrasts and big swings in the market 18 years later. Our philosophy? Don’t worry about the short term, focus on the long term.

We’ve attached a downloadable PDF to give a more in-depth view of our financial approach, though let’s summarize the core tenants here. At our core, M3 believes in enabling our clients to pursue a better investment experience. It’s not about false promises to hit the next jackpot, it’s about ensuring that your experience through the process is as good as it can be, and that when the storm comes you are seen to the end.

We’ve broken down our core beliefs:

  • Embrace Market Pricing
  • Don’t try to OUTGUESS the market
  • Resist chasing PAST performance
  • Let Markets work for you
  • Considers the drivers of returns
  • Practice smart diversification
  • AVOID market timing
  • Manage your EMOTIONS
  • Look Beyond the Headlines
  • Focus on what YOU can control

The final point is part of our process M3:

  • Creating an investment plan that fits your financial plan and risk tolerance
  • Structure a portfolio to capture the drivers of expected returns
  • Diversify Globally
  • Manage expenses, turnover, and taxes
  • Stay disciplined through market dips and swings

What we believe

An enduring investment philosophy is built on solid principles backed by decades of empirical academic evidence. Examples of such principles might be: trusting that prices are set to provide a fair expected return; recognizing the difference between investing and speculating; relying on the power of diversification to manage risk and increase the reliability of outcomes; and benchmarking your progress against your own realistic long-term investment goals.

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