New Monthly Reporting Available

Example of the Stock Intersection Report

Financial Advisors with the heart of a teacher. It’s one of the first things you see on our website. It’s one of the sayings you’ll hear Dave Ramsey and the crew at Ramsey Solutions, constantly preach. It’s what we try to instill in the life blood of any financial advisor that puts on the green and white Whitaker-Myers jersey (ok, ok we don’t actually have jerseys….. yet). To that end, clients will see a few new reports uploaded to their Morningstar Client Login Portal each month. These reports are designed to provide clients with a better understanding of their investments. Let’s dive into what you’ll begin seeing each month.

Stock Intersection Report

The Stock Intersection Report actually X-Ray’s your mutual funds and ETFs to help you understand what you’re investing in. You might ask, “aren’t I investing into mutual funds” and the answer would certainly be yes. However, let’s consider what a mutual fund is for a moment. It’s a basket of stocks, assuming it’s a stock mutual fund, that the fund manager has picked, that spreads your risk amongst many different companies. Therefore, if one company has a bad year, gets bad news about it published, goes bankrupt, I didn’t lose all my eggs because they weren’t in one basket. As a result, when you see a mutual fund on your statement, you can assume that you’re invested in a few hundred different stocks (or bonds if it is a bond mutual fund).

Which stocks are you invested in? That is exactly what this report helps you understand. The featured picture helps this client understand their largest holding(s) when combining all their mutual funds together and x-raying them. In this example, Amazon at 2.03%, is the largest holding of this portfolio and that is because five of their mutual funds invest into Amazon. The T. Rowe Price Blue Chip Growth Fund has $6,677.45 of the clients’ money invested into Amazon, which equates to 1.13% of their portfolio. Following that Invesco’s QQQ has $389.50 invested into Amazon and so-on. As a point of comparison, the S&P 500’s top five holdings are: Apple (5.48%), Microsoft (5.21%), Google (3.94%) Amazon (3.84%), Facebook (2.21%)

Performance Summary Report

This monthly performance summary report will give you a view of your portfolio’s performance since your inception with Whitaker-Myers Wealth Managers to the ending of the previous month. The returns are shown on an annual basis, over the past four rolling years and a since inception return which is an annualized number, meaning if I see 9.66%, it means 9.66% per year, since inception.

Please keep in mind, if you view your account on the Charles Schwab website (schwab.com) Schwab will show you a Gain/Loss tab but that is reporting a tax gain or loss, which is used by your advisor and/or accountant to help you calculate the amount of taxes owed when an investment is sold. This report from Morningstar should be used when determining your rate of return.

Portfolio Holding Analysis

This report provides you with an analysis of each of your mutual fund holdings. Specifically, we added this report because it provides you the Morningstar Rating for each of your mutual funds. While not an end all, be all, Morningstar Ratings can provide a client with an idea of how well a fund as performed, relative to its benchmark (how it should have performed based on peers and the stock market in general). Every fund category has its own benchmark. For example, the benchmark a growth & income fund would use, would be different than the benchmark an international fund would use. How are you to decipher all this information? One way, is the Morningstar Star Rating. Five is the best and one is the worst. People are generally visual – therefore if I see the majority of my funds at a four- and five-star classification, I can be confident to know I’m in solid performing mutual funds and/or ETFs.

Conclusion

It’s our desire that this information is helpful and creates an even deeper sense of understanding when reviewing your investments. One thing we know, is they can never replace the person-to-person learning and understanding a financial advisor, with the heart of teacher can provide. Should you have any questions or need access to your own personal Morningstar Client Portal, please reach out to your advisor today.

Author: John-Mark Young, Financial Advisor