Planting for your future

This is the inaugural post in our blog. We have titled it “Planting for Your Future”, because we believe that investors can get too caught up in the short term noise and forget what is most important, their long term goals. Most of us invest today with some purpose. That purpose could be a comfortable retirement, to send their kids to college, to buy a house (or a 2^nd house) or to leave money for the next generation. In almost all cases, if you invest in the stock market, you need to have a long term time horizon. Stocks are great investments, when viewed over an extended time frame, but can be quite volatile in shorter periods. At Harvest, we only utilize equities for that portion of a client’s assets that are not needed in the next 3-5 years.

With these opening thoughts in minds, it was wonderful to receive this email from one of our first clients:

Jim, just to let you know that this market doesn't bother me at all and I'm not bothered by negatives on my performance reports. . When I see stocks like GM hitting 53-year lows, it brings back memories of Chrysler at $2 per share. As far as I'm concerned you can be as aggressive in buying equities as you see opportunities.

Why was I so happy? Simply, because this client gets it. He clearly understands that markets can be very volatile. But, if you have a long time horizon, we should be utilizing the weakness in the markets to be buying. If we purchase solid companies at today’s lower valuations and sprinkle in a little patience, we can make a lot of money for our clients. I am not calling a bottom, but I am looking at companies and asking whether they represent compelling values today. The answer I am giving far more often is “yes”.