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I don’t fish, but for decades I have lived with a man who does and here is what I have learned:

  1. The best time to catch a lot of fish on the Chattahoochee River is on opening day of the fishing season. It seems that the state stocks the river at that time so your odds of success are increased dramatically.
  2. Where you see loons and other big birds diving into the lake there is a good chance of a school of fish below them. Be quick, those schools move and by the time you motor over there they may well be gone.

So what can “we who do not fish” learn from this:

  1. If everyone knows that the river is stocked everyone should be successful. In reality, even if everything is identical from the prior year, where you stand in the river will produce different results this year. It is the same when it comes to allocating our hard earned dollars. Beware of the “can’t lose” investment. Look carefully at the promises made before you move what you have worked so hard to earn into a “sure bet.”
  2. Just as schools of fish move, so does market performance. Yesterday’s hot sector’s return will likely not be the same as its return today. By the time you move your money where things looked so good, there is a good chance that circumstances will have changed and momentum will have shifted.   Rather than motoring to where the loons were, try to determine which direction the school of fish went. Success in this is even harder when it comes to placing our chips on the roulette wheel of retirement planning.

The moral of this story:

Just as good fishermen familiarize themselves with the best spots on the river or the lake, so should we educate ourselves on market sectors. As the most successful fishermen cover a wide variety of spots in the water to have their best days, so should we also be sure that we diversify our money into many places to ensure the greatest opportunity for long term success.

For assistance in navigating the waters, contact us at CDA Inc.