Nikki Dunn, CFP®

Wealth Planning For DIY Traders/Investors & Biz Owners. *Market, Macro & Money Takes*

[Nikki Dunn, CFP® @SheTalksFinance]

Robert Kiyosaki has been the ultimate financial doom and gloomer.

He’s been calling for a major all-around asset crash for years.

Here are a few of his INSANE predictions and how much $ you would have LOST if you followed him:

[Nikki Dunn, CFP® @SheTalksFinance]

Being a contrarian, avoiding the noise and staying focused on fundamentals has paid off for SaaS investors.

Usually the best setups come from the depths of negative sentiment and herd mentality.

Myself and @stockgeekTV talk about this all of the time on the @wetalkmoneypod.

[Nikki Dunn, CFP® @SheTalksFinance]

SaaS stocks may be the best setup for stock pickers right now.

The entire group is getting punished, but they won’t all be losers.

[Nikki Dunn, CFP® @SheTalksFinance]

Exactly the right take on “risk tolerance.”

Risk CAPACITY is more important when allocating a portfolio.

Tolerance = mental willingness to take on risk
Capacity = financial ability to take on risk

Very different things…

[Cullen Roche @cullenroche]

This is something I've completely changed my mind about in recent years. I now think the idea of a subjective "risk tolerance" is a terrible concept.

Everyone gets scared during a bear market. And everyone thinks they won't get scared during a bear market. You will. And it's normal.

Your portfolio risk should be based on your financial risk *capacity* and that is absolutely quantifiable if one correctly assesses balance sheet vs income statement health.

A 65 year old retiree with $500K withdrawing $20K per year has a vastly different risk capacity than a 65 year old with $5MM withdrawing $50k per year. The person with the superior financial health can take more risk because they have vastly less sequence risk in their financial plan.

Young people with stable incomes can typically take more risk because their income is equivalent to a very large and safe fixed income allocation. They should take more equity risk because their income statement health allows it.

Age and emotions shouldn't be the primary driver of risk. Financial health and risk capacity should.

[ Q-Cap  @qcapital2020]

The hardest pill for bears to swallow:

The S&P 500 is up +10.3% YTD, yet the forward P/E has fallen from 22.3x to 21x

This rally hasn’t been driven by speculative multiple expansion

It’s been driven by earnings estimates rising faster than stock prices

[Nikki Dunn, CFP® @SheTalksFinance]

The more advisors see their clients’ wealth grow, and real tax strategy actually working, the less they care about the hate people spread about them.

Value is added when:
-Clients stay invested when they normally wouldn't
-Poor portfolio allocations get adjusted
-Tax strategy reduces tax liability
-Huge financial decisions get made with more clarity
-Overall stress is reduced in someone's life
...just to name a few.

[Nikki Dunn, CFP® @SheTalksFinance]

I was told having every streaming service is the new definition of success 😂

I hope the whole industry consolidates because it's getting ridiculous.

[Nikki Dunn, CFP® @SheTalksFinance]

@HeroDividend We areeeeee 😂

[Nikki Dunn, CFP® @SheTalksFinance]

@markcecchini Just left there , it was spectacular!

[Nikki Dunn, CFP® @SheTalksFinance]

We will have another large drawdown one day, but I wonder if investors are changing.

“New age” investors have been taught to stay the course. Stimulus comes and fixes things. A 35% drawdown looks more like an opportunity to them. Crypto has birthed stock investors that sneeze at a 35% drawdown in assets.

Is the future less emotional panic and more buying bear markets aggressively? It depends on what’s causing the bear I’m sure, but this is something I’m thinking about.

[Bravos Research @bravosresearch]

The US stock market is now more expensive than it was in 1929, 1965, and 2000.

Each of these coincided with a major market top that led to over a 35% drawdown.

But each of them were triggered by one key factor…

A thread 🧵

[Nikki Dunn, CFP® @SheTalksFinance]

@Lifeinvestmoney Be my financial advisor plz

[Nikki Dunn, CFP® @SheTalksFinance]

@FintwitPeaked @khushkhushkhush Scary but true

[Nikki Dunn, CFP® @SheTalksFinance]

When I said the pain trade was to the upside on @wetalkmoneypod this is what I meant.

Felt like everyone was trying to follow what the textbooks said (yields, valuation, geopolitical risk), but we’re dealing with a different beast.

Resilient consumer (for now and against all odds), insane profitability from the companies making up a large % of the index, a lot of cash on the sidelines still, and a huge technological revolution.

The pain trade is likely coming to a peak and a correction is imminent. That doesn’t necessarily mean this bull trend is over though.

It’s a fascinating market that feels full of inefficiencies.

[Neil Sethi @neilksethi]

Aggregate median short interest (as % of shares outstanding) is now the highest since 2010 for Russell 3000 companies from this DB chart.

[Chris Dunn @ChrisDunnTV]

New #WeTalkMoney episode!

Strong Markets, Fragile Foundations: What Breaks First?

- Why are tech stocks still ripping to all time highs?
- How will Trump’s visit to China impact markets?
- Is bitcoin finally breaking out of its bear market?

[Nikki Dunn, CFP® @SheTalksFinance]

@myersbradley @egr_investor We stress test different types of returns and sequence of return risk to see if the portfolio will last. Everyone talks about baseline returns but we can stress test lost decades at certain times of retirement, periods of lower returns
, etc…

[Nikki Dunn, CFP® @SheTalksFinance]

It's funny to me that people think wealth advisors aren't taking into account lost decades when we do planning.

We are. We know it's possible.

[Nikki Dunn, CFP® @SheTalksFinance]

Certainly many overbought stocks that will have their corrections. SPX will correct again as well.

Earnings support the SPX tho which is why bears keep getting crushed and buyers keep creating V-bottoms. Happened in 2018 as well.

2008 was a different beast. 2000/2021 is the closet to what we're seeing.

[Nikki Dunn, CFP® @SheTalksFinance]

Everyone is trying to predict a big crash in stocks... here's what I have to say to anyone trying to get ahead of it.

[Nikki Dunn, CFP® @SheTalksFinance]

@markcecchini The bears will keep telling you it’s a bubble and will all collapse still … ask me how I know … 🙃

[Nikki Dunn, CFP® @SheTalksFinance]

The bears heads might explode if this happened in SPX...

[Nikki Dunn, CFP® @SheTalksFinance]

@cam5442 I'll continue to follow the earnings, thanks for the advice though ...

Here's some data for you.

[Nikki Dunn, CFP® @SheTalksFinance]

@ChrisOw50104388 @CeoTrav3 I'll continue to follow the earnings on this one... upward revisions all over the place

[Nikki Dunn, CFP® @SheTalksFinance]

What we have today is nothing like the 2008 financial crisis. All-time-highs in equities don't equate to bear markets being around the corner.

Those of you comparing today to 2000, profitability today is way better than it was then. Top 10 companies are valued way more reasonably vs. 2000.

Know your fundamentals and maybe you won't get left behind and have to spread FUD.

[AheadoftheNews @AheadoftheNews]

I'm from a generation that lived through and traded 2 monster bear markets, 2000 and 2008. -78% tech, -54% financial crisis.
On both those occasion, we were at ATHs and no one was bearish before, except in a movie.