On It with Offit - February 2024

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FEB | 2024 Offit Advisors Attend Kestra Ascend in Palm Springs Offit Advisors CEO, Ben Offit and Financial Advisor, Laura Sendldorfer were on the ground at the Kestra Ascend conference in Palm Springs, California for a few days of investment due diligence, practice management consulting, and networking with other top advisory firms from around the country. They not only got to enjoy the beautiful scenery, but also interacted with executives and discussed planning for 2024, and beyond. Did you know that that it may be beneficial for FAFSA planning in 2024 to move 529 accounts into being owned by Grandparents instead of parents?  This can help increase eligibility to receive financial aid. An Important Planning Reminder: Clients will receive their investment 1099s, 5498s, etc by end of February and to use on their taxes! We unfortunately had a friend of the practice become a victim to financial fraud.  We want to make our clients aware of any potential red flags or fishy situations.  We learned about this upcoming presentation and though it could be helpful to share:     Seniors and their families will have the opportunity to learn about elder fraud abuse from a member of the Federal Bureau of Investigation's Baltimore office.   The presentation is scheduled for Tuesday, March 5th at 7:30 p.m. at the Brightview senior living community in Perry Hall, 9657 Belair Road, in the Dorsey Room. The forum is cosponsored by the office of Baltimore County Councilman David Marks, the Perry Hall Improvement Association, the Perry Hall/White Marsh Business Association, and the Woman's Club of Perry Hall.  FBI Agent Sarah Lewis works for the FBI Baltimore office, Financial Crimes Squad. For the past three years, she has been investigating financial scams, mostly romance and tech fraud, that are victimizing such a large number of our retired community. In an effort to try to prevent these schemes, she has been doing outreach in the community at senior centers, age 55 and over communities, and larger churches. Agent Lewis will speak about scams, red flags, how to avoid them, current trends, and what to do if you do fall victim.   All are welcome, and there is no charge. Proactive Financial Planning: Part I Financial planning is akin to tending a garden; it requires regular attention, thoughtful care, and occasional pruning to ensure it thrives over time. Here are eight miscellaneous but key tips to consider as part of a comprehensive financial plan:   1) Strategic 401(k) Contributions: Kickstart your year by overfunding your 401(k) early on. By front-loading your contributions, you allow more time for your investments to grow over the year. This tactic takes advantage of dollar-cost averaging, potentially maximizing your returns. However, remember to ensure you receive the full company match throughout the year to optimize your benefits.   2) Annual Cash Flow Review: Regularly assessing your cash flow and spending habits is fundamental to maintaining financial health. Set aside time each year to scrutinize your income, expenses, and savings. Identifying areas of excess spending or opportunities for saving can significantly impact your long-term financial goals.   3) Credit Monitoring and Protection: Safeguarding your financial identity is paramount. Annually check your credit score through platforms like Credit Karma and consider freezing your credit with major bureaus—Experian, Equifax, and TransUnion. This proactive measure helps prevent identity theft and shields against potential data breaches.   4) Beneficiary Designations: Ensure your assets smoothly transition to your intended beneficiaries by reviewing and updating beneficiary designations annually. From bank accounts to life insurance policies, confirming designated beneficiaries minimizes the likelihood of assets going through probate and streamlines the inheritance process.   5) Per Stirpes Consideration: Deliberate on whether per stirpes designation aligns with your estate planning objectives. This legal term ensures assets pass to the descendants of a beneficiary in the event of their death, offering a structured approach to wealth distribution.   6) 529 Plans for Education Savings: Explore the benefits of 529 accounts for future education expenses. Not only do these plans provide tax advantages for in-state contributions, but recent legislation also allows rollovers to Roth IRAs if the funds aren't used for education expenses, offering flexibility in financial planning.   7) Understanding IRMAA: Anticipate how income sources in retirement can impact Medicare premiums through the Income-Related Monthly Adjustment Amount (IRMAA). Being mindful of potential increases in premiums due to higher income levels can inform retirement income strategies.   8) Insurance and Estate Planning Review: Conduct an annual review of your insurance policies, including life, disability, long-term care, and property and casualty insurance. Ensure coverage aligns with your current needs and circumstances. Additionally, keep your estate plan up to date, and communicate its details to your family members for clarity and preparedness in case of unforeseen events.   In conclusion, effective financial planning requires a proactive and holistic approach. By implementing these miscellaneous tips, individuals can navigate their financial journeys with confidence, laying the groundwork for a secure and prosperous future. Stay tuned for more insights in Part 2 of Maximizing Your Financial Planning series In the Middle Ages, Valentine’s Day became associated with love and romance, a tradition that came from the common belief in France and England that birds started their mating season on February 14. Good Housekeeping, December 27, 2023   Nvidia is now worth as much as the entire Chinese stock market. yahoo!finance, February 9, 2024   On Friday, Feb 2, 2024. Meta shares rose more than 20%, adding $205 billion to its market capitalization. To put that into perspective, the world’s 20 largest airlines are cumulatively valued at $210 billion. Investopedia, February 2, 2024   According to the Federal Reserve, baby boomers hold a massive amount of wealth: The 55.8 million Americans over 65, about 17% of the population, hold $96.4 trillion, which is about half of America’s wealth Business Insider, October 18, 2024 “Headlines, in a way, are what mislead you because bad news is a headline, and gradual improvement is not.”  - Bill Gates “I arise in the morning torn between a desire to improve (or save) the world and a desire to enjoy (or savor) the world. This makes it hard to plan the day.”  - E. B. White Modest Gains for Stocks, Modest Declines for Bonds to Start the Year Highlights The solid end to 2023 for stocks continued in early 2024 as all-time highs were achieved for the S&P 500 and Dow Jones Industrial Average. After hitting prior highs at the very start of 2022, these indices – after two long years – marched to record highs once again. However, small-caps struggled to start 2024. Coinciding with stock prices at all-time highs, earnings are expected to hit an all-time high in 2023 once fourth quarter data is tallied for S&P 500 companies as well. Earnings are expected to grow once again in 2024 to new highs from the 2023 levels. Yields had a dramatic drop over the last couple of months of 2023. After touching 5% intraday in late October – the highest yield level since prior to the credit crisis in 2007 – the 10-year U.S. Treasury yield closed 2023 at 3.88%. Rates bounced up from that point in January and closed the month at 3.99%. The FOMC met in late January and as expected, made no change to the Fed Funds rate. However, the Fed dampened expectations of a March rate cut, which sent stocks lower on the final day of the month. The debate now is how rate cuts will unfold in 2024. The U.S. economy continues to be much stronger than most expected. The first look at Q4 2023 GDP was another positive surprise with an annualized growth rate of 3.3% compared to expectations of 2.0%. This growth is on the heels of Q3 growth which stood at 4.9%. The U.S. economy has been resilient. Equity Markets   Stocks started 2024 strongly with the S&P 500 and Dow Jones Industrial Average hitting new all-time highs in January. However, some of those gains were given up at the end of the month as the Fed lowered expectations of a rate cut at the March FOMC meeting. Noteworthy, the market fell back into its recent pattern of large-cap growth outperforming most other areas of the market in January. For example, the Russell 1000 Growth Index gained 2.49% for the month, while the Russell 1000 Value Index only advanced 0.10%. The equal-weighted S&P 500 Index was down in January while the traditional market-cap weighted S&P 500 Index gained for the month. Small-caps struggled in January after enjoying a double-digit rally in December. See Table 1 for equity results for January 2024 and calendar year 2023. Table 1 Index     Jan 2024     2023 S&P 500     1.68%     26.29% S&P 500 Equal Weight     -0.82%     13.87% DJIA     1.31%     16.18% Russell 3000     1.11%     25.96% NASDAQ Comp.     1.04%     44.64% Russell 2000     -3.89%     16.93% MSCI ACWI ex U.S.     -0.99%     15.62% MSCI Emerging Mkts Net     -4.64%     9.83% Source: Bloomberg For illustrative purposes only. Indexes are unmanaged and have been provided for comparison purposes only. No fees or expenses are reflected. You cannot invest directly in an index.   2023 will be remembered for the dominance of large-cap growth, and 2024 started much the same way. However, the broadening in the market over the last two months of 2023 led to solid gains across the board in equity markets last year. We believe the market could continue to broaden in 2024 with valuations more compelling in small, mid-cap and international stocks. International stocks continued to underperform U.S. equities with emerging markets among the weakest of the stock market categories to begin 2024. We still see opportunities in international markets with valuations that are lower than the U.S. and our expectation that the U.S. dollar will likely weaken over the short to intermediate-term as the Fed begins cutting rates in 2024. Fixed Income After struggling for much of 2023, bonds rallied in November and December to turn in solid results for the year. After peaking in late October, yields dropped sharply through year end, but that drop paused in January. It is a good reminder that yields can move quickly at times and it is important for bond investors to stay focused on their long-term goals during periods of volatility. The 10-year U.S. Treasury yield closed 2023 at 3.88% and it moved up to end January at 3.99% creating a headwind for bonds to begin the new year See Table 2 for fixed income index returns for January 2024 and calendar year 2023. Table 2 Index    Jan 2024       2023 Bloomberg U.S. Agg    -0.27%        5.53% Bloomberg U.S. Credit    -0.18%       8.18% Bloomberg U.S. High Yld    0.00%       13.44% Bloomberg Muni    -0.51%       6.40% Bloomberg 30-year U.S. TSY    -2.70%       1.93% Bloomberg U.S. TSY    -0.28%       4.05% Source: Bloomberg. For illustrative purposes only. Indexes are unmanaged and have been provided for comparison purposes only. No fees or expenses are reflected. You cannot invest directly in an index. The move higher in rates in January was a challenge for most bond sectors. High yield bonds were flat, while more interest rates sensitive bonds like longer-dated U.S. Treasuries came under the most pressure. We expect the 10-year U.S. Treasury yield to drift lower as we move through 2024 and believe it will be in a range between 3.25% and 4.5% during the year. As the Fed begins to cut rates in 2024, we believe this will drive down rates at the front end of the yield curve as well. We maintain our long-standing position favoring credit versus pure rate exposure in this interest rate environment. We also believe the role bonds play in a portfolio, which is to provide stable cash flow and to help offset the volatility of stocks in the long run, has not changed. Furthermore, we believe that bond yields remain attractive even though rates have dropped from their October highs. In our opinion, having an active bond management approach makes sense in these volatile times. S&P 500 Index is an unmanaged group of securities considered to be representative of the stock market in general. You cannot directly invest in the index. Dow Jones Industrial Average - The Dow Jones Industrial Average is a popular indicator of the stock market based on the average closing prices of 30 active U.S. stocks representative of the overall economy.  NASDAQ Composite Index measures all NASDAQ domestic and international based common type stocks listed on The NASDAQ Stock Market. Today the NASDAQ Composite includes approximately 5,000 stocks, more than most other stock market indices. Because it is so broad-based, the Composite is one of the most widely followed and quoted major market indices. Russell 2000® Index measures the performance of the 2,000 smallest companies in the Russell 3000 Index, which represents approximately 8% of the total market capitalization of the Russell 3000 Index which includes the 3,000 largest companies in the U.S., based on market capitalization. As of the latest reconstitution, the average market capitalization was approximately $762.8 million; the median market capitalization was approximately $613.5 million. The largest company in the index had an approximate market capitalization of $2.0 billion and a smallest of 218.4 million.  Russell 1000® Growth Index measures the performance of those Russell 1000 companies with higher price-to-book ratios and higher forecasted growth values.  Russell 1000® Value Index measures the performance of those Russell 1000 companies with lower price-to-book ratios and lower forecasted growth values.  Government bonds are guaranteed by the U. S. Government and, if held to maturity, offer a fixed rate of return and fixed principal value. Securities offered through Kestra Investment Services, LLC (Kestra IS), Member FINRA/SIPC. Investment Advisory Services offered through Kestra Advisory Services, LLC (Kestra AS), an affiliate of Kestra IS. Offit Advisors is not affiliated with Kestra IS or Kestra AS. Offit Advisory Services, LLC is a tax firm but neither Kestra IS nor Kestra AS provide legal or tax advice and are not Certified Public Accounting firms.For more information on the Five Star Wealth Manager and the research/selection methodology go to: www.fivestarprofessional.com. Investor Disclosures: https://bit.ly/KF-Disclosures 6990 Columbia Gateway Drive Suite 150 Columbia, MD 21046, US Phone + Fax:  410 600 PLAN (7526) E – Office@OffitAdvisors.com W- www.OffitAdvisors.com   To schedule an appointment with us, click here! The opinions expressed in this commentary are those of the author and may not necessarily reflect those held by Kestra IS or Kestra AS. The material is for informational purposes only. It represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results. It is not guaranteed by Kestra IS or Kestra AS for accuracy, does not purport to be complete and is not intended to be used as a primary basis for investment decisions. It should also not be construed as advice meeting the particular investment needs of any investor. Neither the information presented nor any opinion expressed constitutes a solicitation for the purchase or sale of any security. Want to change how you receive these emails? You can update your preferences or unsubscribe from this list.

On It with Offit - January 2024

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JAN | 2024 Welcoming Sophia Trakhtman to  Offit Advisors! Offit Advisors is thrilled to welcome Wealth Management Specialist Sophia Trakhtman to our team. Sophia is smart, driven, confident, energetic, and a hard worker, and will bring integrity and high-level communication skills to her role at OA. We are proud to have you on our team Sophia!    Learn a little bit more about Sophia Trakhtman in her own words: " As John L Beckley once said, “Most people don’t plan to fail, they fail to plan.” This is where my passion for guiding my clients through an extensive financial education comes in. It is my goal to educate every client that I work with about personal finance and the importance of planning ahead. I am committed to providing my clients with consistent service needed in developing, implementing, and maintaining a comprehensive business and individual strategy.   I am a born and raised Baltimorean, who is the child of Soviet Union immigrants. My parents came here with our entire family in 1991. Trying to provide for a family while learning a new language in a new environment was a very difficult task for my parents. Over 30 years later, they grew the family to five and started a business. Their hard work and determination has resonated with me in my own practice. I am just as determined to provide excellent service for my clients as my family was when they came here.   In the present day, my fiancé and I live in Baltimore Maryland and have two dogs, Asher and Ana. We enjoy traveling to Sunny Isles Florida several times a year to spend time with family. When I am not in my office: I enjoy teaching ballet, practicing yoga and Pilates, and spending time with nieces and nephews.   My main physical office is in Columbia, Maryland, however I often travel to Virginia, Pennsylvania, District of Columbia, and Sunny Isles, Florida."    Ben and His Son Reed Enjoy a Day at the Office! Reed Offit woke up one morning last month with a vision. He wanted to get dressed up in his best business attire and head into the office with his Dad. As you can see, Reed really enjoyed playing some hookie from school, and Ben loved every minute of an unexpected Take Your Son to Work day. Make Sure to Update Your Contributions to 401ks and IRAs this year! For 401ks, the maximum limit is $23,000 for people under 50, and $30,500 for those over 50.  For IRAs, the maximum limit is $7,000 for people under 50, and $8,000 for those over 50. Keep your eyes peeled; OA clients will be receiving 1099s for their investment accounts by the end of February. Building a Life of Success: Lessons from a Master Investor - Charlie Munger Last month, renowned investor and partner of Warren Buffet, passed away at the age of 99.  I feel this is a good time as any to honor the man and his endless wisdom.  Here are a few of his infamous quotes and lessons he taught us: "A lot of people with high IQs are terrible investors because they've got terrible temperaments." While intelligence plays a role in achieving success, a calm and controlled mind is often more valuable. Qualities like patience, discipline, and emotional stability become the true cornerstones of wise decision-making. "Remember that reputation and integrity are your most valuable assets—and can be lost in a heartbeat." Building trust and maintaining a good reputation takes time and effort, but it can be shattered in an instant by unethical behavior or poor choices. Munger's advice encourages us to act with integrity in all aspects of life, recognizing that a strong reputation is essential for long-term success and happiness. "Go to bed smarter than when you woke up." AND “Develop into a lifelong self-learner through voracious reading; cultivate curiosity and strive to become a little wiser every day.” The pursuit of knowledge and wisdom is a lifelong journey. He emphasized the importance of learning from the experiences and insights of others, rather than trying to reinvent the wheel. This continuous learning can be achieved through voracious reading, seeking mentors, and engaging in open-minded discussions. Munger's own dedication to learning is evident in his statement, "I believe in the discipline of mastering the best that other people have ever figured out. I don't believe in just sitting down and trying to dream it all up yourself. Nobody's that smart." "It's so simple to spend less than you earn, and invest shrewdly, and avoid toxic people and toxic activities, and try and keep learning all your life, and do a lot of deferred gratification. If you do all those things, you are almost certain to succeed. If you don't you're going to need a lot of luck." Munger outlines a straightforward formula for building a successful life: He emphasizes the importance of living below your means, investing wisely, avoiding negativity, learning constantly, and practicing delayed gratification. These seemingly simple principles, when consistently applied, can pave the way for a fulfilling and prosperous life. "In my whole life, I have known no wise people (over a broad subject matter area) who didn't read all the time — none, zero." Charlie emphasized the critical role of reading in developing wisdom and understanding. His own dedication to learning through reading serves as a testament to the power of this habit. "The big money is not in the buying and selling, but in the waiting." "The first rule of compounding: Never interrupt it unnecessarily." Munger's message is clear: invest with a long-term perspective and resist the urge to constantly churn your portfolio and by doing so, investors can unlock the true power of the market and achieve significant wealth creation. The words and principles of Charlie Munger offer valuable insights for building a successful and fulfilling life. By cultivating emotional stability, prioritizing integrity, embracing lifelong learning, and adopting simple but effective strategies, we can navigate the complexities of life and achieve our goals. Munger's message is a reminder that success is not solely dependent on intellect, but rather on a combination of wisdom, discipline, and a commitment to continuous learning and growth. It is estimated that U.S. consumers will return $173 billion in goods between Thanksgiving and the end of January. Chain Store Age, January 2, 2024   The U.S. government spent more on health care in 2022 than six countries with universal health care combined. StatNews, December 19, 2023   Researchers suggest that only 9% of Americans who make New Year’s resolutions complete them. In fact, research goes on to show that 23% of people quit their resolution by the end of the first week, and 43% quit by the end of January. Fisher.OSU.edu. February 2, 2023   The Magnificent Seven (Apple, Microsoft, Google, Amazon, Nvidia, Tesla, and Meta) now have a higher weighting in the MSCI World Index than all of the stocks in the UK, China, France, and Japan combined. The The Wall Street Journal, December 17, 2023   The inventor of the wind chill factor died this week. He was 86, but he felt more like he was 64. Annonymous “The secret to successful investing is relatively simple: Figure out the value of something and then pay a lot less.” Joel Greenblatt 2023 Ends Strongly as Rally Continued in December Highlights The last two months of 2023 drove returns in many parts of the market for the entire year. The stock market rally broadened in December and underperforming areas like small-cap stocks rose sharply to turn in solid annual gains. Large-cap growth still dominated the year, but 2023 turned out to be a strong year overall for stocks. Yields continued to fall in December. The yield on the 10-year U.S. Treasury closed November at 4.37% and dropped to end the year at 3.88%. This drop in rates from the October highs and subsequent rally in bond prices resulted in solid bond returns for 2023 – again, driven primarily by late-year gains. Much of the rally in stocks and bonds can be attributed to the market’s strengthening belief that this rate-hike cycle is finished. The first FOMC meeting of 2024 occurs at the end of January and the fed fund futures are pricing in a first right hike occurring in March. We’ll see. The U.S. economy continues to grow, but Q4 growth will likely pale in comparison to the torrid pace of growth from Q3. While odds have likely increased for a “soft landing,” there is still a possibility of a mild recession, and that potential outcome should not be ignored. Finally, corporate earnings are improving and expected to grow in calendar years 2023 and 2024. While expected earnings growth has moderated somewhat for 2023, earning expectations for 2024 have remained solid. Equity Markets   After three straight months of declines through October, stocks rallied in November and December. The rally in December was across the board, but some of the lagging parts of the market rebounded sharply in the last month of the year. Small-caps enjoyed a double-digit monthly gain, which drove most of their 2023 results. With the market gaining confidence that this Fed rate hike cycle might be over, stocks gained momentum in December and rates dropped dramatically leading to a solid month of returns in both stocks and bonds.  See Table 1 for equity results for December, Q4, and 2023.   Table 1   Index    December 2023    Q4    2023 S&P 500    4.54%    11.69%    26.29% S&P 500 Equal Weight    6.86%    11.87%    13.87% DJIA    4.93%    13.09%    16.18% Russell 3000    5.30%    12.07%    25.96% NASDAQ Comp.    5.58%    13.79%    44.64% Russell 2000    12.22%    14.03%    16.93% MSCI ACWI ex U.S.    5.02%    9.75%    15.62% MSCI Emerging Mkts Net    3.91%    7.86%    9.83% Source: Bloomberg For illustrative purposes only. Indexes are unmanaged and have been provided for comparison purposes only. No fees or expenses are reflected. You cannot invest directly in an index.   In our opinion, 2023 will be remembered for the dominance of large-cap growth. However, the broadening in the market over the last two months of the year led to solid gains across the board in equity markets. The S&P 500 Equal Weight Index, the Russell 2000 Index, and the MSCI Emerging Markets Index show the bulk of their gains came late in the year as most parts of the market outside of large-cap growth were lackluster for much of 2023. The indices driven by large-cap growth companies including the S&P 500 Index, the NASDAQ Composite, and the Russell 3000 showed strong gains in the fourth quarter as well, which added to what was already a strong year of results. The Russell 2000 Index led the broader markets higher in December and those gains drove the overall 2023 results for small-caps. Broad international equities showed solid returns in December as well. The MSCI ACWI ex. U.S. Index showed returns more or less in line with many parts of the U.S. markets (outside of large-cap growth companies). Emerging markets proved to be the weak spot in 2023, but even with that said, the MSCI Emerging Market Index was up just shy of 10% for 2023. We still see opportunities in international markets with valuations that are lower than the U.S. and our expectation that the U.S. dollar will largely weaken over the short-to-intermediate term. Coinciding with the market gaining confidence around the conclusion of this rate hike cycle, the dollar weakened in November and December and appears to be trending lower. Fixed Income After struggling for much of the year, bonds rallied in November and December to turn in solid results for 2023. The grind higher in rates through the summer and into the fall had dragged bond returns down with most major bond indices ending in negative territory year-to-date through October. However, November saw bond yields drop sharply, and bonds staged a significant rally during the month and that momentum continued in December. It is a good reminder that yields can move quickly at times, and it is important for bond investors to stay focused on their long-term goals during periods of volatility. We know the vast majority of a bond’s return is interest income and the reinvestment of that income, but when rates are moving, bond prices can fluctuate in the short term. The 10-year U.S. Treasury yield dropped in November from 4.88% (October’s close) to 4.37% by the end of November. This move continued lower, and the yield ended 2023 at 3.88%. That decline in rates became a tailwind for bond returns late in the year. An interesting side note, the 10-year U.S. Treasury closed 2022 at that exact yield level of 3.88% as well, but we all know there was a lot of volatility between those two points in time throughout 2023. See Table 2 for fixed income index returns for December, Q4, and year to date. Table 2   Index    December 2023    Q4    2023 Bloomberg U.S. Agg    3.83%    6.82%    5.53% Bloomberg U.S. Credit    4.19%    8.15%    8.18% Bloomberg U.S. High Yld    3.73%    7.16%    13.44% Bloomberg Muni    2.32%    7.89%     6.40% Bloomberg 30-year U.S. TSY    8.71%    12.85%    1.93% Bloomberg U.S. TSY    3.36%    5.66%    4.05% Source: Bloomberg. For illustrative purposes only. Indexes are unmanaged and have been provided for comparison purposes only. No fees or expenses are reflected. You cannot invest directly in an index. The move higher in rates during much of 2023 presented bond investors with opportunities to invest at higher yields and coupons than seen in several years. We expect the 10-year U.S. Treasury yield to move lower as we move into 2024, but we also anticipate volatility along the way. We maintain our long-standing position favoring credit versus pure rate exposure in this interest rate environment. We also believe the role bonds play in a portfolio, to provide stable cash flow and to help offset the volatility of stocks in the long run, has not changed. Furthermore, we believe that bond yields remain attractive even though rates have dropped rather sharply over the last two months. In our opinion, having an active approach in fixed income can help navigate these volatile times. S&P 500 Index is an unmanaged group of securities considered to be representative of the stock market in general. You cannot directly invest in the index. Dow Jones Industrial Average - The Dow Jones Industrial Average is a popular indicator of the stock market based on the average closing prices of 30 active U.S. stocks representative of the overall economy.  NASDAQ Composite Index measures all NASDAQ domestic and international based common type stocks listed on The NASDAQ Stock Market. Today the NASDAQ Composite includes approximately 5,000 stocks, more than most other stock market indices. Because it is so broad-based, the Composite is one of the most widely followed and quoted major market indices. Russell 2000® Index measures the performance of the 2,000 smallest companies in the Russell 3000 Index, which represents approximately 8% of the total market capitalization of the Russell 3000 Index which includes the 3,000 largest companies in the U.S., based on market capitalization. As of the latest reconstitution, the average market capitalization was approximately $762.8 million; the median market capitalization was approximately $613.5 million. The largest company in the index had an approximate market capitalization of $2.0 billion and a smallest of 218.4 million.  Russell 1000® Growth Index measures the performance of those Russell 1000 companies with higher price-to-book ratios and higher forecasted growth values.  Russell 1000® Value Index measures the performance of those Russell 1000 companies with lower price-to-book ratios and lower forecasted growth values.  Government bonds are guaranteed by the U. S. Government and, if held to maturity, offer a fixed rate of return and fixed principal value. Securities offered through Kestra Investment Services, LLC (Kestra IS), Member FINRA/SIPC. Investment Advisory Services offered through Kestra Advisory Services, LLC (Kestra AS), an affiliate of Kestra IS. Offit Advisors is not affiliated with Kestra IS or Kestra AS. Offit Advisory Services, LLC is a tax firm but neither Kestra IS nor Kestra AS provide legal or tax advice and are not Certified Public Accounting firms.For more information on the Five Star Wealth Manager and the research/selection methodology go to: www.fivestarprofessional.com. Investor Disclosures: https://bit.ly/KF-Disclosures 6990 Columbia Gateway Drive Suite 150 Columbia, MD 21046, US Phone + Fax:  410 600 PLAN (7526) E – Office@OffitAdvisors.com W- www.OffitAdvisors.com   To schedule an appointment with us, click here! The opinions expressed in this commentary are those of the author and may not necessarily reflect those held by Kestra IS or Kestra AS. The material is for informational purposes only. It represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results. It is not guaranteed by Kestra IS or Kestra AS for accuracy, does not purport to be complete and is not intended to be used as a primary basis for investment decisions. It should also not be construed as advice meeting the particular investment needs of any investor. Neither the information presented nor any opinion expressed constitutes a solicitation for the purchase or sale of any security. Want to change how you receive these emails? You can update your preferences or unsubscribe from this list.

On It with Offit - December 2023

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DEC | 2023 Enjoy Episode Two of  Offit on the Street Offit On The Street is back for another episode. Test your knowledge of the world of finance against some of our contestants. Happy Holiday Wishes from the Team at Offit Advisors Per a new analysis of census data from Glassdoor, Gen Z is expected to overtake baby boomers in the workforce by next year. Glassdoor, November 15, 2023   Walmart’s physical footprint is unmatched, with enough floor space in stores in the United States alone to accommodate some 12,500 football fields. Chartr, November 19, 2023   Nearly half of all banking profits last quarter came in from just four companies: JP Morgan, Citigroup, Wells Fargo, and Bank of America. The other 4400 banks in the U.S. had to fight for the leftovers. Financial Times, November 11, 2023   A ticket to pass through the Panama Canal was sold at auction for a record $2.85 million last week. A normal booking fee costs $900,000, but the Panama Canal Authority has capped the number of daily ship crossings due to drought. TradeWinds, November 1, 2023 Black Friday: because only in America do people trample each other for sales exactly one day after being thankful for what they already have. - Anonymous   S&P 500 Index is an unmanaged group of securities considered to be representative of the stock market in general. You cannot directly invest in the index. Dow Jones Industrial Average - The Dow Jones Industrial Average is a popular indicator of the stock market based on the average closing prices of 30 active U.S. stocks representative of the overall economy.  NASDAQ Composite Index measures all NASDAQ domestic and international based common type stocks listed on The NASDAQ Stock Market. Today the NASDAQ Composite includes approximately 5,000 stocks, more than most other stock market indices. Because it is so broad-based, the Composite is one of the most widely followed and quoted major market indices. Russell 2000® Index measures the performance of the 2,000 smallest companies in the Russell 3000 Index, which represents approximately 8% of the total market capitalization of the Russell 3000 Index which includes the 3,000 largest companies in the U.S., based on market capitalization. As of the latest reconstitution, the average market capitalization was approximately $762.8 million; the median market capitalization was approximately $613.5 million. The largest company in the index had an approximate market capitalization of $2.0 billion and a smallest of 218.4 million.  Russell 1000® Growth Index measures the performance of those Russell 1000 companies with higher price-to-book ratios and higher forecasted growth values.  Russell 1000® Value Index measures the performance of those Russell 1000 companies with lower price-to-book ratios and lower forecasted growth values.  Government bonds are guaranteed by the U. S. Government and, if held to maturity, offer a fixed rate of return and fixed principal value. Securities offered through Kestra Investment Services, LLC (Kestra IS), Member FINRA/SIPC. Investment Advisory Services offered through Kestra Advisory Services, LLC (Kestra AS), an affiliate of Kestra IS. Offit Advisors is not affiliated with Kestra IS or Kestra AS. Offit Advisory Services, LLC is a tax firm but neither Kestra IS nor Kestra AS provide legal or tax advice and are not Certified Public Accounting firms.For more information on the Five Star Wealth Manager and the research/selection methodology go to: www.fivestarprofessional.com. Investor Disclosures: https://bit.ly/KF-Disclosures 6990 Columbia Gateway Drive Suite 150 Columbia, MD 21046, US Phone + Fax:  410 600 PLAN (7526) E – Office@OffitAdvisors.com W- www.OffitAdvisors.com   To schedule an appointment with us, click here! The opinions expressed in this commentary are those of the author and may not necessarily reflect those held by Kestra IS or Kestra AS. The material is for informational purposes only. It represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results. It is not guaranteed by Kestra IS or Kestra AS for accuracy, does not purport to be complete and is not intended to be used as a primary basis for investment decisions. It should also not be construed as advice meeting the particular investment needs of any investor. Neither the information presented nor any opinion expressed constitutes a solicitation for the purchase or sale of any security. Want to change how you receive these emails? You can update your preferences or unsubscribe from this list.

On It with Offit - November 2023

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NOV | 2023 Check Out the First Episode of Offit on the Street We hope you enjoy watching this fun video as much as we enjoyed making it! A New US Citizen, Walking for a Good Cause, and More Here's a little insider view; A Microsoft Teams chat at Offit Advisors summarizing what was a very active weekend for the company.   Congratulations to Offit Advisors' very own Laura Sendldorfer, who recently became a citizen of the United States, after immigrating 11 years ago from Germany. Laura has grown tremendously professionally and personally from not knowing English when she first arrived in the US as an Au Pair to now being an amazing Financial Advisor, who various Securities and Insurance licenses and being a Charted Financial Consultant (ChFC®) ! The Offit Advisors team proudly joined the Run Hope Work 5K in support of a great charity, and our late client Jose Ortiz. Ben and his family, and Laura and her husband Steven joined the 5k in Washington DC, while Zach Weisenthal ran virtually in Gaithersburg and Barbara Owens walked virtually on the beach Myrtle Beach. Ben Closes Out October in Halloween Style   In the picture above, Ben got in the spirit of the season, dressing up as Kendall Roy from HBO’s Succession for Halloween. Staying Sane in the Wild World of Finance: Don't Chase Investment Fads, Focus on What Works Hey there, lovely readers! Today, we're diving headfirst into the lovely world of investment fads! So, imagine you are at a neighbors BBQ in Maple Lawn, while you overhear a neighbor starting to brag about how much money they have made in XYZ investment. Sound familiar? Well, let’s talk about how some of those work and ones to be aware of. Fad 1: Chasing Past Performance in Funds There is something within investing called the Behavior Gap. And what they find each year is that the ‘regular investor’ underperforms the market by about half of what it does. This is because most people chase what seems to be hot at the moment, and they shy away from what seems to be underperforming at the moment. This can be seen in funds where investors chase the past performance of what it did previously, but that doesn’t necessarily forecast what it will do in the future. A similar example could be investors chasing things ‘hot funds’ like Cryptocurrency, NFTs, Cannabis stocks, AI stocks, Vaccine stocks, etc. It seems logical to invest in something that seems to have so much relevance and importance in the moment, but that is not necessarily a predictor of what it will do in the future. Fad 2: Chasing Short-Term Interest Rates With interest rates being higher, people are saying to themselves why should I invest or “take risk” in the stock market when I get “Treasury bills and chill” and earn 5.6%? These are the highest yields we have seen since 2001, and while they may feel comfortable and cozy in the short term, in the long term it can end up costing you a lot of money. If you look back at January 2001, when we also had higher interest rates and yields, and then look out over the next 20-year period – cash did 31%, treasury bonds did 163%, and the S&P 500 did 318%. So ultimately, just like it felt good in January 2001 to get Treasury Bills or CDs, or it may feel good now, in the long term you may be costing yourself money. These yields aren’t permanent, but staying invested and capturing long-term returns are. Fad 3: Chasing the Top Tech Companies People are also focusing on that most of the returns are being driven in 2023 by the ‘Magnificent 7’ the top 7 (tech stocks) in the S&P 500 (Apple, Meta, Tesla, Nvidia, Amazon, Alphabet, Microsoft). The fact is that while these companies are doing great right now and are “hot”, the top companies change all of the time. If you look back to previous decades, the top companies were things like General Electric, IBM, Exxon, etc and these were before things like the top companies today were even conceived of. This type of thing happens all of the time. So if chasing performance and fads is a mistake, what should most investors do? Not a Fad: Focus on the Fundamentals Focus on the following instead: 1) Asset Allocation – your ratio of stocks to bonds and what makes sense for your long-term financial plan 2) Be Diversified – having all of the asset classes in your portfolio 3) Low-cost – be invested in a low-cost way with index funds 4) Tax-Efficient – Invest in Funds that don’t have a lot of turnover, capital gains, etc. 5) Manage Behavior – stay invested for a decade or more, despite the ups and downs along the way All of this will help you get out of the “in-and-out” philosophy. Instead of focusing on who did best recently, focus on the ingredients that lead to success. Don’t chase the hot short-term fads, focus on what works in the long term. An Important Message About Mental Health & Suicide Prevention The holidays can be particularly difficult for people struggling with mental health. Please take a few moments to watch this powerful video about mental health, and Be sure to check in on your loved ones.  If you or someone you know is struggling, click the link below to get quick access to help by calling the 988 Suicide and Crisis Lifeline.   Get Help Now S&P 500 Index is an unmanaged group of securities considered to be representative of the stock market in general. You cannot directly invest in the index. Dow Jones Industrial Average - The Dow Jones Industrial Average is a popular indicator of the stock market based on the average closing prices of 30 active U.S. stocks representative of the overall economy.  NASDAQ Composite Index measures all NASDAQ domestic and international based common type stocks listed on The NASDAQ Stock Market. Today the NASDAQ Composite includes approximately 5,000 stocks, more than most other stock market indices. Because it is so broad-based, the Composite is one of the most widely followed and quoted major market indices. Russell 2000® Index measures the performance of the 2,000 smallest companies in the Russell 3000 Index, which represents approximately 8% of the total market capitalization of the Russell 3000 Index which includes the 3,000 largest companies in the U.S., based on market capitalization. As of the latest reconstitution, the average market capitalization was approximately $762.8 million; the median market capitalization was approximately $613.5 million. The largest company in the index had an approximate market capitalization of $2.0 billion and a smallest of 218.4 million.  Russell 1000® Growth Index measures the performance of those Russell 1000 companies with higher price-to-book ratios and higher forecasted growth values.  Russell 1000® Value Index measures the performance of those Russell 1000 companies with lower price-to-book ratios and lower forecasted growth values.  Government bonds are guaranteed by the U. S. Government and, if held to maturity, offer a fixed rate of return and fixed principal value. Securities offered through Kestra Investment Services, LLC (Kestra IS), Member FINRA/SIPC. Investment Advisory Services offered through Kestra Advisory Services, LLC (Kestra AS), an affiliate of Kestra IS. Offit Advisors is not affiliated with Kestra IS or Kestra AS. Offit Advisory Services, LLC is a tax firm but neither Kestra IS nor Kestra AS provide legal or tax advice and are not Certified Public Accounting firms.For more information on the Five Star Wealth Manager and the research/selection methodology go to: www.fivestarprofessional.com. Investor Disclosures: https://bit.ly/KF-Disclosures 6990 Columbia Gateway Drive Suite 150 Columbia, MD 21046, US Phone + Fax:  410 600 PLAN (7526) E – Office@OffitAdvisors.com W- www.OffitAdvisors.com   To schedule an appointment with us, click here! The opinions expressed in this commentary are those of the author and may not necessarily reflect those held by Kestra IS or Kestra AS. The material is for informational purposes only. It represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results. It is not guaranteed by Kestra IS or Kestra AS for accuracy, does not purport to be complete and is not intended to be used as a primary basis for investment decisions. It should also not be construed as advice meeting the particular investment needs of any investor. Neither the information presented nor any opinion expressed constitutes a solicitation for the purchase or sale of any security. Want to change how you receive these emails? You can update your preferences or unsubscribe from this list.

On It with Offit - October 2023

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OCT | 2023 Offit Advisors Brings Clients & Friends Together for Fall Outing Check out Ben's speech from this year's Fall Outing, with a few very special little guests, and a fun and interactive team panel.  OA's Laura Sendldofer & Rachel Burk Participate in UMGC's Financial Wellness Day Laura Sendldorfer and Rachel Burk provided pro bono virtual financial planning for people who traditionally don’t work with a financial advisor through UMGC Financial Wellness Day. This is always a meaningful and valuable experience for our advisors to use their knowledge skills and talents and give back.   Ben Offit Named One of the Country's Top Financial Advisors for 2023 Ben was recently named one of the Top Financial Advisors in America by Five Star Wealth Manager, recognized for excellence in his field. Surge pricing isn’t just for Ubers and Airfare anymore. The rise of algorithms and AI has introduced the concept across a growing number of businesses. For example, “Amazon changes the price of its products on average every 10 minutes,” and Walmart has begun installing “electronic shelf labels” that allow its brick-and-mortar store to “rapidly update prices.” The Week, October 1, 2023 Despite rising interest rates, Americans spent 5.8% more in August than a year earlier. About 64% of households made at least one large purchase in the previous four months, the highest reading since 2015. The Wall Street Journal, October 1, 2023   Individual taxpayers, businesses, and corporations collectively owed $688 billion in unpaid taxes for the returns due last year. According to the IRS, those are the projections about the gap between taxes owed and taxes actually paid. NPR, October 13, 2023   October 9, 2023 According to data from the Federal Reserve, since 1962, the average daily 10-year Treasury yield was more than a point higher than now- 5.9%. Barron’s. October 3, 2023 The missiles that comprise the land component of America’s nuclear triad are scattered across thousands of square miles of prairie and farmland, mainly in North Dakota, Montana, and Wyoming. About 150 of the roughly 400 Minuteman III intercontinental ballistic missiles are currently on alert, and it would take an ICBM about 25 minutes to reach Moscow. The Atlantic, September 2023   “Everybody is born 100% ego; after that, it’s just adjustment.” Agnes Martin Staying Sane in the World of Finance; Don't Chase Investment Fads, Focus on What Works In today's edition, we're diving headfirst into the lovely world of investment fads. So, grab your popcorn, and try not to spill it as we enjoy this up-and-down financial journey!   Investment Fads: The Chase for Success Imagine you are at a neighbor's BBQ in Maple Lawn, while you overhear a neighbor starting to brag about how much money they have made in XYZ investment. Sound familiar? Well, let’s talk about how some of those work and ones to be aware of. Fad 1: Chasing Past Performance in Funds There is something within investing called the Behavior Gap. This is illustrated by a third-party research institution called Dalbar, which does a study each year of how ‘regular investors’ performance is compared to the market. And what they find each year is that the ‘regular investor’ underperforms the market by about half of what it does. This is because most people chase what seems to be hot at the moment, and they shy away from what seems to be underperforming at the moment. This can be seen in funds like ARKK which did really well at its onset and then significantly underperformed after it amassed a lot of new investors and capital. These investors were chasing the past performance of what it did, not what it was going to do in the future. A similar example could be investors chasing things like Cryptocurrency, NFTs, Cannabis stocks, AI stocks, Vaccine stocks, etc. It seems logical to invest in something that seems to have so much relevance and importance in the moment, but that is not necessarily a predictor of what it will do in the future.   Fad 2: Chasing Short-Term Interest Rates With interest rates being higher, people are saying to themselves why should I invest or “take risk” in the stock market when I get “Treasury bills and chill” and earn 5.6%? These are the highest yields we have seen since 2001, and while they may feel comfortable and cozy in the short term, in the long term it can end up costing you a lot of money. If you look back at January 2001, when we were near a recession, and then look out over the next 20-year period – cash did 31%, treasury bonds did 163%, and the S&P 500 did 318%. So ultimately, while it felt good in January 2001, or may feel good now, in the long term you are costing yourself money with lesser long-term returns just by staying invested through the volatility. In addition, after taxes, Treasury bills earn closer to 3.9% right now. These yields aren’t permanent, but staying invested and capturing long-term returns are.   Fad 3: Chasing the Top Tech Companies People are also focusing on that most of the returns are being driven in 2023 by the ‘Magnificent 7’ the top 7 (tech stocks) in the S&P 500 (Apple, Meta, Tesla, Nvidia, Amazon, Alphabet, Microsoft). The fact is that while these companies are doing great right now and are “hot”, the top companies change all of the time. If you look back to previous decades, the top companies were things like General Electric, IBM, Exxon, etc and these were before things like the top companies today were even conceived of. Another example is think about Blockbuster. Who could have imagined that consumers would stop going to a physical store and picking out VCR tapes? Then out of nowhere came Netflix. Now Netflix faces competition from Hulu, Disney Plus, Amazon Prime, etc and who knows if it will be around in 10 or 20 years. This type of thing happens all of the time. So if chasing performance and fads is a mistake, what should most investors do?   Not a Fad: Focus on the Fundamentals If you want a good blueberry pie, focus on the ingredients. Focus on finding high-quality blueberries, high-quality butter, and high-quality ingredients to make the dough, and follow a recipe that has worked many many times over to deliver a good pie. The same is true for investing:   1) Focus on your asset allocation – your ratio of stocks to bonds and what makes sense for your long-term financial plan 2) Focus on how it should be diversified (US vs International, Growth vs Value, Large vs Small Cap, etc.) 3) Focus on becoming invested in a low-cost way with index funds that don’t cost very much 4) Focus on investing in funds that have tax efficiency and don’t inherently create a lot of capital gains and taxes to pay 5) Focus on staying invested for a decade or more, despite the ups and downs along the way All of this will help you get out of the “in-and-out” philosophy. Instead of focusing on who did best recently, focus on the ingredients that lead to success. Don’t chase the hot short-term fads, focus on what works in the long term. Stocks Slip Further in September as Yields Rise to Highest Levels in Years HIGHLIGHTS   Stock market weakness from August continued in September and the S&P 500 Index recorded its first negative quarter of 2023.   The VIX Index, a measure of stock market volatility, closed September at 17.52. Reflecting higher volatility during the month, the VIX Index approached 20 for the first time since May.   The FOMC left the Fed Funds rate unchanged in September, but bond yields rose to their highest level in years during the month. In what has been a rather steady move higher since May, the 10-year U.S. Treasury yield closed the month at 4.59% after closing at 4.61% just a few days earlier. The market has not seen yields this high since prior to the credit crisis in 2007. The increase in yields put pressure on bond returns in September and pushed some areas of the bond market into negative year-to-date territory. The economy remains strong, but signs of modest slowing seem to be developing on the job front. Payroll additions and job openings have declined in recent months as companies appear more cautious in hiring at this point in the cycle. On a positive note, corporate earnings are improving and earnings are expected to grow in calendar year 2023 and 2024. EQUITY MARKETS The strong early summer for stocks gave way to late-summer weakness and a fall that has started on a soft note as well. Declines in September were broad, with value stocks holding up only modestly better than growth stocks and large-caps holding up only modestly better than small-caps. However, declines were experienced across the board. International stocks declined less than U.S. stocks. See Table 1 for equity results for September, Q3 and year to date. Table 1 Index Sep 2023 Q3 YTD S&P 500 -4.77%  -3.27% 13.07% S&P 500 Equal Weight.           -5.08%             -4.90%. 1.79% DJIA -3.42% -2.10%       2.73% Russell 3000 -4.76% -3.25% 12.39% NASDAQ Comp. -5.77% -3.94% 27.11% Russell 2000 -5.89% -5.13% 2.54% MSCI ACWI ex U.S. -3.16% -3.77% 5.34% MSCI Emerging Mkts Net -2.62% -2.93% 1.82% Source: Bloomberg For illustrative purposes only. Indexes are unmanaged and have been provided for comparison purposes only. No fees or expenses are reflected. You cannot invest directly in an index. As the table shows, declines in September drove quarterly results into negative territory for most of these equity indices. Comparing and contrasting the S&P 500 Index with its equal-weighted counterpart provides important insight into this market. Driven by the strong performance of large-cap and mega-cap Technology companies, the S&P 500 Index shows a solid year-to-date gain of over 13%. However, the equal-weighted S&P 500 Index (which can be thought of as representing what the average stock is doing) reflects a much more modest gain of less than 2% so far this year. Simply said, the largest cap Technology companies, which have a larger weighting in the S&P 500 Index, have been the primary drivers of the market in 2023. Meanwhile, the average stock has exhibited only modest returns. Further to that point, small-caps, as measured by the Russell 2000 Index, have gained only 2.54% so far this year and growth has dominated value. The Russell 1000 Growth Index has advanced 24.98% while its value counterpart has gained only 1.79% year to date. Large-cap growth stocks, and in particular, those in the Technology sector, have dominated results this year after struggling in 2022. Broad international equities outperformed U.S. markets in September, but the U.S. has seen stronger results year to date. The MSCI ACWI ex. U.S. Index was down -3.16% in September and the MSCI Emerging Market Index fell -2.62%. We still see opportunities in international markets with valuations that are significantly lower than the U.S. and our expectation that the U.S. dollar will largely weaken over the short to intermediate term. However, so far this year, U.S. stocks have outperformed international stocks. Fixed Income   As rates continued to rise, bond returns struggled for the month and quarter. Declines during the quarter pushed several of the bond indices into negative year-to-date territory with the exception of high yield. The 10-year U.S. Treasury yield has been trending upwards since late spring. Over the third quarter, the yield closed July at 3.97%, August at 4.09% and September at 4.59%. It was a tough quarter for bonds indeed with an acceleration of declines in September. Rates have been volatile in 2023, but the trend has clearly been higher in recent months. See Table 2 for fixed income index returns for September, Q3 and year to date.   Table 2 Index Sep 2023       Q3 YTD Bloomberg U.S. Agg -2.54%  -3.23% -1.21% Bloomberg U.S. Credit -2.60% -3.01% 0.03% Bloomberg U.S. High Yld -1.18% 0.46% 5.86% Bloomberg Muni -2.93% -3.95% -1.38% Bloomberg 30-year U.S. TSY.          -7.60% -12.72%.           -9.68% Bloomberg U.S. TSY -2.21% -3.06% -1.52% Source: Bloomberg For illustrative purposes only. Indexes are unmanaged and have been provided for comparison purposes only. No fees or expenses are reflected. You cannot invest directly in an index.   We believe that the recent move higher in rates has presented bond investors with opportunities to invest at even higher yields and coupons than seen earlier this year. We certainly acknowledge that the accompanying near-term decline in bond prices has been a challenge. However, we believe that higher yields in bond portfolios could benefit clients over the longer term. We expect the 10-year U.S. Treasury yield to move lower as we go through 2023 and into 2024, but we also anticipate volatility along the way. The more interest rate sensitive pockets of the bond market (like U.S. Treasuries) have been the hardest hit with this recent move higher in rates. Less interest rate sensitive high-yield bonds have been the clear winner so far in 2023, which is not that surprising on the heels of such solid stock market gains as well. We maintain our long-standing position favoring credit versus pure rate exposure in this interest rate environment. We also believe the role bonds play in a portfolio, to provide stable cash flow and to help offset the volatility of stocks in the long run, has not changed. Furthermore, we believe that bond yields are attractive in what are some of the highest yields we have seen in the last 15 years. S&P 500 Index is an unmanaged group of securities considered to be representative of the stock market in general. You cannot directly invest in the index. Dow Jones Industrial Average - The Dow Jones Industrial Average is a popular indicator of the stock market based on the average closing prices of 30 active U.S. stocks representative of the overall economy.  NASDAQ Composite Index measures all NASDAQ domestic and international based common type stocks listed on The NASDAQ Stock Market. Today the NASDAQ Composite includes approximately 5,000 stocks, more than most other stock market indices. Because it is so broad-based, the Composite is one of the most widely followed and quoted major market indices. Russell 2000® Index measures the performance of the 2,000 smallest companies in the Russell 3000 Index, which represents approximately 8% of the total market capitalization of the Russell 3000 Index which includes the 3,000 largest companies in the U.S., based on market capitalization. As of the latest reconstitution, the average market capitalization was approximately $762.8 million; the median market capitalization was approximately $613.5 million. The largest company in the index had an approximate market capitalization of $2.0 billion and a smallest of 218.4 million.  Russell 1000® Growth Index measures the performance of those Russell 1000 companies with higher price-to-book ratios and higher forecasted growth values.  Russell 1000® Value Index measures the performance of those Russell 1000 companies with lower price-to-book ratios and lower forecasted growth values.  Government bonds are guaranteed by the U. S. Government and, if held to maturity, offer a fixed rate of return and fixed principal value. Securities offered through Kestra Investment Services, LLC (Kestra IS), Member FINRA/SIPC. Investment Advisory Services offered through Kestra Advisory Services, LLC (Kestra AS), an affiliate of Kestra IS. Offit Advisors is not affiliated with Kestra IS or Kestra AS. Offit Advisory Services, LLC is a tax firm but neither Kestra IS nor Kestra AS provide legal or tax advice and are not Certified Public Accounting firms.For more information on the Five Star Wealth Manager and the research/selection methodology go to: www.fivestarprofessional.com. Investor Disclosures: https://bit.ly/KF-Disclosures 6990 Columbia Gateway Drive Suite 150 Columbia, MD 21046, US Phone + Fax:  410 600 PLAN (7526) E – Office@OffitAdvisors.com W- www.OffitAdvisors.com   To schedule an appointment with us, click here! The opinions expressed in this commentary are those of the author and may not necessarily reflect those held by Kestra IS or Kestra AS. The material is for informational purposes only. It represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results. It is not guaranteed by Kestra IS or Kestra AS for accuracy, does not purport to be complete and is not intended to be used as a primary basis for investment decisions. It should also not be construed as advice meeting the particular investment needs of any investor. Neither the information presented nor any opinion expressed constitutes a solicitation for the purchase or sale of any security. Want to change how you receive these emails? You can update your preferences or unsubscribe from this list.

On It with Offit - September 2023

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SEP | 2023 OA On the Road Again as Summer Comes to a Close The Offit Family spent part of August with Mickey and the crew for an amazing Disney vacation, which included a day at Disney's Magic Kingdom and a wonderful Disney cruise. Meanwhile, Laura checked off two destinations, enjoying time with friends in Puerto Rico, and visiting family in her native Germany. And Zach headed out west to spend some time with family in beautiful Montana.  Good Grapes! OA's World of Wine Event Was a Smashing Success In September, we hosted a World of Wine tasting event in our office for a small group of clients.  We had a masterful Sommelier experience with Jeff Jamieson who led us on a history of wines from around the world.  It was an enjoyable evening with great clients and great conversation, and we look forward to more events like this. Please let us know if you would be interested in such an event in the future. Considering joint financial accounts with your partner? Ben Offit, principal at Offit Advisors, suggests finding “ways to come to an agreement about how you will manage together.” Read More The amount held in money market mutual funds has recently hit a fresh record of $5.625 trillion. MSN, September 15, 2023   Chinese goods made up 13.3% of U.S. imports during the first six months of this year- the lowest level since 2003. The peak was nearly 22% in 2017. The Wall Street Journal, August 12, 2023 An average NFL broadcast lasts well over three hours, yet it delivers a total of only 18 minutes of football action. FiveThirtyEight, January 31, 2020   Returns to online retailers are now averaging close to 20%, and returns of apparel are often double that. Winter holiday returns in the U.S. are now more than $300 billion dollars a year, or about one and a half percent of GDP- which would be bigger than the GDP of many countries worldwide. The New Yorker, August 14, 2023   “Whatever you do, always give 100%. Unless you’re donating blood.” Bill Murray Stocks End Summer on a Volatile Note; Bond Yields Surge Higher  HIGHLIGHTS   Stocks took a pause in August. After two months of market breadth improvement and a solid summer rally, equities slid lower for the month. The VIX Index, a measure of stock market volatility, rose to its highest level since late May as stocks struggled during August. Bond yields rose to their highest level in years in August, surpassing the recent highs from last October. The 10-year U.S. Treasury closed at a high of 4.34% during August – its highest level since 2007. However, the yield slid lower to close the month at 4.09%. The increase in yields during the month put pressure on bonds and fixed income returns were broadly lower in August outside of high yield. The economy remains resilient, but signs of slowing seem to be developing on the job front. The unemployment rate remains low, but job growth has slowed, and job openings have declined in recent months. This development is not that unexpected at the end of this aggressive rate-hike cycle. Corporate earnings are improving. EQUITY MARKETS   Equities moved lower in August after what had been a very solid run for stocks in recent months. The not-too-unexpected decline hit those areas of recent strength particularly hard – small caps and value stocks. Large-cap growth, which has been the clear leader so far this year, saw more modest declines. International stocks also struggled in August. See Table 1 for equity results for August and year to date.   Table 1 Index    August 2023      YTD S&P 500    -1.59%      18.73% S&P 500 Equal Weight    -3.16%      7.24% DJIA    -2.01%      6.37% Russell 3000    -1.93%      18.01% NASDAQ Comp.    -2.05%      34.88% Russell 2000    -5.00%      8.96% MSCI ACWI ex U.S.    -4.52%      8.78% MSCI Emerging Mkts Net    -6.16%      4.55%   Source: Bloomberg For illustrative purposes only. Indexes are unmanaged and have been provided for comparison purposes only. No fees or expenses are reflected. You cannot invest directly in an index. The average stock encountered a more challenging environment in August. Recall, the equal-weighted S&P 500 Index (which can be thought of as representing what the average stock is doing) was negative through the first five months of the year and it dropped -3.16% in August compared to the better-known market-cap weighted S&P 500 Index, which slipped only -1.59%. This disparity tells us that smaller companies struggled in general more than larger companies and we saw that with the Russell 2000 Index (a measure of small-cap stocks) down -5.00% for the month. By comparison, the larger company Russell 1000 Index was down -1.75%. Furthermore, the growth/value disparity is easy to see compared to the Russell 1000 Growth Index, which is off only -0.90% compared to the Russell 1000 Value Index, which declined -2.70%. So, August really epitomized the general action we have seen overall in 2023 – large-caps have outperformed small-caps and growth has outperformed value. Broad international equities underperformed U.S. markets in August, as has been the case for most of 2023. The MSCI ACWI ex. U.S. Index was down -4.52% in August and the MSCI Emerging Market Index fell -6.16%. Both monthly declines put a large dent in year-to-date returns for these indices, which showed gains of 8.78% and 4.55%, respectively. We still see opportunities in international markets with valuations that are significantly lower than the U.S. Our expectation is that the U.S. dollar will largely weaken over the short to intermediate-term, but so far this year, U.S. stocks have outperformed international stocks.   FIXED INCOME As rates rose, bond returns struggled during the month. The 10-year U.S. Treasury yield has been trending upwards since the late spring and closed July at 3.97%. This trend continued in August as the 10-year hit its highest level mid-month since the credit crisis before closing the month at 4.09%. That compares to the 2022 close on the 10-year of 3.88%. So, while rates have been volatile, they have moved higher in 2023. We can see that the 30-year U.S. Treasury Index is now negative year to date. High yield bonds were an outlier making gains during the month as there does not appear to be stress in the credit markets. See Table 2 for fixed income index returns for August and year to date. Table 2 Index    August 2023      YTD Bloomberg U.S. Agg    -0.64%      1.37% Bloomberg U.S. Credit    -0.72%      2.70% Bloomberg U.S. High Yld    0.28%      7.13% Bloomberg Muni    -1.44%      1.59% Bloomberg 30-year U.S. TSY    -3.13%      -2.25% Bloomberg U.S. TSY    -0.52%      0.70%   Source: Bloomberg. For illustrative purposes only. Indexes are unmanaged and have been provided for comparison purposes only. No fees or expenses are reflected. You cannot invest directly in an index. We expect the 10-year U.S. Treasury yield to move lower as we go through 2023 and into 2024, but we also anticipate volatility along the way. We believe the recent move higher in yields was driven by the large supply of government bonds coming to market and is not reflective of interest rate fundamentals. High yield bonds have been the winner so far in 2023, which is not that surprising given such solid stock market gains. Bonds have enjoyed a better environment in 2023 compared to a historically challenging period for fixed income in 2022; however, the last three months have been more challenging for bonds with rates rising. We maintain our long-standing position favoring credit versus pure rate exposure in this interest rate environment. We also believe the role bonds play in a portfolio, to provide stable cash flows and to help offset the volatility of stocks in the long run, has not changed. In our view, bond yields are attractive, and are offering some of the highest yields we have seen in the last 15 years. S&P 500 Index is an unmanaged group of securities considered to be representative of the stock market in general. You cannot directly invest in the index. Dow Jones Industrial Average - The Dow Jones Industrial Average is a popular indicator of the stock market based on the average closing prices of 30 active U.S. stocks representative of the overall economy.  NASDAQ Composite Index measures all NASDAQ domestic and international based common type stocks listed on The NASDAQ Stock Market. Today the NASDAQ Composite includes approximately 5,000 stocks, more than most other stock market indices. Because it is so broad-based, the Composite is one of the most widely followed and quoted major market indices. Russell 2000® Index measures the performance of the 2,000 smallest companies in the Russell 3000 Index, which represents approximately 8% of the total market capitalization of the Russell 3000 Index which includes the 3,000 largest companies in the U.S., based on market capitalization. As of the latest reconstitution, the average market capitalization was approximately $762.8 million; the median market capitalization was approximately $613.5 million. The largest company in the index had an approximate market capitalization of $2.0 billion and a smallest of 218.4 million.  Russell 1000® Growth Index measures the performance of those Russell 1000 companies with higher price-to-book ratios and higher forecasted growth values.  Russell 1000® Value Index measures the performance of those Russell 1000 companies with lower price-to-book ratios and lower forecasted growth values.  Government bonds are guaranteed by the U. S. Government and, if held to maturity, offer a fixed rate of return and fixed principal value. Securities offered through Kestra Investment Services, LLC (Kestra IS), Member FINRA/SIPC. Investment Advisory Services offered through Kestra Advisory Services, LLC (Kestra AS), an affiliate of Kestra IS. Offit Advisors is not affiliated with Kestra IS or Kestra AS. Offit Advisory Services, LLC is a tax firm but neither Kestra IS nor Kestra AS provide legal or tax advice and are not Certified Public Accounting firms.For more information on the Five Star Wealth Manager and the research/selection methodology go to: www.fivestarprofessional.com. Investor Disclosures: https://bit.ly/KF-Disclosures 6990 Columbia Gateway Drive Suite 150 Columbia, MD 21046, US Phone + Fax:  410 600 PLAN (7526) E – Office@OffitAdvisors.com W- www.OffitAdvisors.com   To schedule an appointment with us, click here! The opinions expressed in this commentary are those of the author and may not necessarily reflect those held by Kestra IS or Kestra AS. The material is for informational purposes only. It represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results. It is not guaranteed by Kestra IS or Kestra AS for accuracy, does not purport to be complete and is not intended to be used as a primary basis for investment decisions. It should also not be construed as advice meeting the particular investment needs of any investor. Neither the information presented nor any opinion expressed constitutes a solicitation for the purchase or sale of any security. Want to change how you receive these emails? You can update your preferences or unsubscribe from this list.

On It with Offit - August 2023

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AUG | 2023 Laura Sendldorfer Earns Chartered Financial Consultant® (ChFC®) Designation We are pleased to announce that Financial Advisor, Laura Sendldorfer, recently earned the Chartered Financial Consultant® (ChFC®) designation. The ChFC® designation is an important distinction for financial planning professionals. Successful completion of the ChFC® program empowers financial advisors like Laura with advanced knowledge in areas including financial planning, risk management, tax planning, retirement planning, estate planning, special needs planning, and more. By earning the ChFC®, Laura has demonstrated her commitment to professionalism, knowledge, and service to our clients with her expertise. Congratulations Laura! Ben Offit Heads to the Pacific Northwest for Executive Consulting with Philip Palaveev CEO and Founder, Ben Offit, CFP®, went to Seattle in July for an exclusive, all-day executive consulting experience with renowned financial services consultant Philip Palaveev.  Ben had the opportunity to discuss the future of Offit Advisors, team development and planning, financial management, and overall business management. Ben really enjoyed his first time in the Pacific Northwest, extending his trip to visit Vancouver, Canada, which was also amazing and beautiful! Dan Coyne and Jamie Sasselli Bring Insurance Planning Expertise to Offit Advisors Offit Advisors is happy to announce further expansion to its team with the addition of Dan and Jamie to it's support and service of insurance clients. Read more about their bios below. Dan specializes in helping Offit Advisors to provide life insurance, annuities, long term care, and disability income insurance and also specializes in Medigap plans, and impaired risk cases that have difficult underwriting through Triton Brokerage. Dan  started in the industry fresh out of college after he graduated cum laude from West Chester University of Pennsylvania where he majored in Business Management.  He is fluent in Spanish, enjoys travel, golf, and is a die hard Chicago Bears fan.  Dan loves to spend his personal time with his wife Jill, and two children, Olivia and Patrick.    Jamie Sasselli has more than 17 years of experience working in life insurance, annuities, long term care, and disability income insurance.  She primarily works on impaired risk cases.  Jamie is a University of Pittsburgh graduate.  She enjoys travel, horseback riding, camping, kayaking, Disney and watching her daughter play hockey.  In her spare time, Jamie enjoys spending time with her husband, Brian, and their two children, Giovanni and Giana.   Offit Advisors Hosts Medallion Advisor Group Luncheon Late last month we were thrilled to host our friends from Medallion Advisor Group for a Reunion Luncheon at Café Mezanotte in Severna Park. This was an opportunity to reconnect with some advisors we haven't seen in over 15 years! At the lunch, the group discussed the highlights of their careers, the future of the industry, and succession and continuity planning within financial services.  It was truly a fantastic day. "Laura was very easy to talk to. She had some good suggestions and gave me a lot to think about. She was very helpful and friendly." - Lisa The testimonial presented is made by an individual who is a client of Offit Advisors and is applicable only to the individuals depicted and may not be representative of the experience of others. The testimonial is not paid nor have the participants received any non-cash compensation and is not indicative of future performance or success. The testimonial has been evaluated for conflicts of interest and has not been found to present any conflicts. Apple, the company wants rights to the image of apples, the fruit, in Switzerland- one of the dozens of countries where it’s flexing its legal muscles. Between 2019 and 2021, Apple filed more trademark oppositions- attempts to enforce its IP over other companies- than Microsoft, Facebook, Amazon, and Google combined. WIRED, June 18, 2023   The median price for a home in Miami is $585,000. To afford that, homeowners would need to spend 79.9% of Miami’s average monthly income on homeownership expenses topping the amount paid by homeowners in Los Angeles and New York City. Pressreader, June 20, 2023   China’s controversial one-child policy, in place for more than three decades, was removed in 2015. Most people would have guessed that the country’s birth rate would rise, however, the opposite happened. Birth rates in 2022 are now 6.77 babies born per 1,000 people- the lowest level on record. Chartr, June 19, 2023   One study of retail currency traders found 70% on average lose money every quarter, and lose it all within 12 months. MarketWatch, April 19, 2023   “The crisis takes a much longer time coming than you think, and then it happens much faster than you would have thought.” Rudiger Dornbusch “The problem with internet quotes is that you can’t always depend on their accuracy.” Abraham Lincoln, 1864 The Recipe for a Successful Retirement Hey there, clients!   Many people when thinking about their potential retirement, think about their assets or their portfolio, and making sure it makes financial sense to be able to retire, which is natural and makes sense.  But there other elements to a successful retirement that one needs to think about first before doing so!   Health and Time – This is the single most important investment that you can make.  It is way more valuable to be able to enjoy your life until age 100 instead of age 85.  Life is made of memories, experiences, and you need more time to do that.  In order to have time, you need to have your health, so this needs to be a first priority.   A Social Network of Friends – It is hard to retire, because for many people they become great friends with those they work with.  These are people you spend hours with daily and is a big part of your daily communications and livelihood.  If you retire, and leave that, will you have friends to discuss life and the world with?  It is important to have a network of people to be able to enjoy life with and this is a big part of ones happiness in retirement.   Retiring at the Top of your Game – When you reach the point of being in a position to retire, you may be in a senior and experienced position with what you do.  Therefore, you may feel that you are a “Master of your Craft” or at the “Top of Your Game” and it may be hard to walk away from that feeling.    Purpose – If one doesn’t have a purpose in your post-retirement life, then it may be hard to transition to it.  For many people, going to work and making money is their purpose.  But if that is gone, what is your purpose?  Being able to retire TO SOMETHING instead of FROM SOMETHING is a big distinction.  Will be you be able to retire into having more time to live your dreams, to go on vacation and travel, to spend more time with your family, to spend more time with charities and non-profit work, or do something totally different that you couldn’t before?  Or perhaps, you just want to sit on the couch and watch sports, or TV shows all day – nonetheless, you need to be clear about what you want out of your retirement before doing so, and people are happier with a clear purpose in retirement.  Money at the end of the day is just a tool to help you live your purpose.   Flipping a Switch – It is hard to go from working for many years and saving money and having deferred gratification of putting your money away for the future, into starting to enjoy it and spending it.  One needs to be prepared to learn how to flip this switch and enjoy your money and your life!   Here's to investing in our health, time, friends, purpose and enjoying the abundant riches that life has to offer!   S&P 500 Index is an unmanaged group of securities considered to be representative of the stock market in general. You cannot directly invest in the index. Dow Jones Industrial Average - The Dow Jones Industrial Average is a popular indicator of the stock market based on the average closing prices of 30 active U.S. stocks representative of the overall economy.  NASDAQ Composite Index measures all NASDAQ domestic and international based common type stocks listed on The NASDAQ Stock Market. Today the NASDAQ Composite includes approximately 5,000 stocks, more than most other stock market indices. Because it is so broad-based, the Composite is one of the most widely followed and quoted major market indices. Russell 2000® Index measures the performance of the 2,000 smallest companies in the Russell 3000 Index, which represents approximately 8% of the total market capitalization of the Russell 3000 Index which includes the 3,000 largest companies in the U.S., based on market capitalization. As of the latest reconstitution, the average market capitalization was approximately $762.8 million; the median market capitalization was approximately $613.5 million. The largest company in the index had an approximate market capitalization of $2.0 billion and a smallest of 218.4 million.  Russell 1000® Growth Index measures the performance of those Russell 1000 companies with higher price-to-book ratios and higher forecasted growth values.  Russell 1000® Value Index measures the performance of those Russell 1000 companies with lower price-to-book ratios and lower forecasted growth values.  Government bonds are guaranteed by the U. S. Government and, if held to maturity, offer a fixed rate of return and fixed principal value. Securities offered through Kestra Investment Services, LLC (Kestra IS), Member FINRA/SIPC. Investment Advisory Services offered through Kestra Advisory Services, LLC (Kestra AS), an affiliate of Kestra IS. Offit Advisors is not affiliated with Kestra IS or Kestra AS. Offit Advisory Services, LLC is a tax firm but neither Kestra IS nor Kestra AS provide legal or tax advice and are not Certified Public Accounting firms.For more information on the Five Star Wealth Manager and the research/selection methodology go to: www.fivestarprofessional.com. Investor Disclosures: https://bit.ly/KF-Disclosures 6990 Columbia Gateway Drive Suite 150 Columbia, MD 21046, US Phone + Fax:  410 600 PLAN (7526) E – Office@OffitAdvisors.com W- www.OffitAdvisors.com   To schedule an appointment with us, click here! The opinions expressed in this commentary are those of the author and may not necessarily reflect those held by Kestra IS or Kestra AS. The material is for informational purposes only. It represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results. It is not guaranteed by Kestra IS or Kestra AS for accuracy, does not purport to be complete and is not intended to be used as a primary basis for investment decisions. It should also not be construed as advice meeting the particular investment needs of any investor. Neither the information presented nor any opinion expressed constitutes a solicitation for the purchase or sale of any security. Want to change how you receive these emails? You can update your preferences or unsubscribe from this list.