Marc Ruiz of Oak Partners, Mind on Money: Review Debts, Investments in New Year

Marc Ruiz of Oak Partners, Mind on Money: Review Debts, Investments in New Year

As most readers know, in my “day job” at Oak Partners I serve individuals and families by helping them with their financial planning and decision making and by building and managing their investment portfolios taking into account their needs and experience and coupling this knowledge with my own worldview and experience with financial markets and investments.

To do this job, it is imperative I have a “world view” that I can use to make decisions and formulate financial strategies for my clients. To keep my world view current, requires a never-ending process of paying attention to markets, political and economic news and various “thinkers” that provide insight about the world of finance.

Around this time each year I am focused on adapting my forward-looking world view, to set expectations and formulate tactics to address the coming year, while at the same time reviewing last years decision making to learn from successes and mistakes. So, with this in mind, I’d like to share some thoughts about what I expect from our brand new 2018.

In the area of our economy I am feeling momentum like I haven’t felt in at least a decade, maybe almost two decades. Not only is unemployment low, but people around me (clients, employees and family members) are getting raises. Some of them for the first time in years. Raises occur when businesses feel confident about the future, and so a reasonable assumption based on this observation is many businesses are feeling quite positive right now.

In economist speak, this high level of employment and rising wage level is likely to spill over into consumption as Americans shake off their post 2008 frugality and spend a little money. Through poor planning on my part, I recently got tricked into a trip to a fancy mall, based upon the throngs of holiday crowds I encountered, this expectation is already well under way. It’ll be interesting to see the numbers from this year’s holiday shopping season, I’ll bet they look great.

This optimism is also manifesting in the stock market, which hit record high after record high in 2017. As I’ve stated before, I believe we have transitioned into the next stage of the bull market, the euphoric stage and I expect the current bullish trend to continue into 2018.

As the rising market attracts more and more new money, I also expect volatility to increase during 2018 from the record low levels of 2017. Remember, volatility can also be biased to the upside, and as this next bull market stage plays out it will be important to manage portfolio risk levels more actively and very carefully. Different sectors of the stock market also present different risk and opportunity levels, so I will be paying attention to sector exposure in 2018, and won’t be surprised if we see some leadership rotation.

I also believe the other developed economies, the Eurozone and Japan, are also in a sustained growth mode and might be a little bit earlier in the bull market cycle than the U.S. So, I won’t be neglecting international stock market exposure in 2018, but I will be focused on developed, rather than emerging markets.

Finally, after nearly 10 years, I do believe the interest rate cycle to turn materially higher in 2018. I know we’ve heard this all before, but the signs look pretty clear this time. So I will be mindful of my bond investments and would recommend paying attention to variable rate loan products like home equity loans and credit cards and focus on paying down balances as rates begin to rise. Happy New Year.

Opinions are solely the writer's. Marc Ruiz is a wealth adviser with Oak Partners and a registered representative of Sll investments, member FINRA/SIPC. Oak Partners and Sll are separate companies. Contact Marc at