Latest news with #Mallouk
Yahoo
21-05-2025
- Business
- Yahoo
Charlie Munger Once Said, 'The First Rule Of Compounding Is To Never Interrupt It Unnecessarily' — Now His Wisdom Rings True As The S&P 500 Surges 220% Over 10 Years
The S&P 500 index has yielded a 220% return in the last 10 years. Peter Mallouk, the CEO of Creative Planning Inc., highlights this data and recalls veteran investor Charlie Munger's insights on the power of compounding and being patient through uncertainty. What Happened: According to the graphic shared by Mallouk, the S&P 500 Total Return index has risen by 220% since 2015, providing a 12.3% annualized return over these 10 years. However, the graph also shows another scenario where the investors who exited their positions on March 23, 2020, due to the fear of the COVID-19 pandemic, earned only a 17% return, representing an annualized return of only 1.6% over these same 10 years. Trending: Maker of the $60,000 foldable home has 3 factory buildings, 600+ houses built, and big plans to solve housing — Recalling the insight from the former Vice President of Berkshire Hathaway Inc. (NYSE:BRK) (NYSE:BRK), Charles T. Munger, Mallouk post stated, 'The first rule of compounding is to never interrupt it unnecessarily.' Thus, Mallouk implied through Munger's saying that the power of compounding would yield positive results if the process of compounding is uninterrupted. The shared data reiterated this through the pandemic's panic Mallouk shared another set of data representing the growth of a $100,000 investment made in the S&P 500 Total Return index 50 years ago in 1974. According to the inflation-adjusted growth of this $100,000 investment, the amount in 2024 would stand at a staggering $15,347,191. Highlighting this, Mallouk quoted Munger again, "The big money is not in the buying and selling but in the waiting." This again reiterated Munger's teachings, stating that patience was the key to the power of compounding, as 'waiting' was more important than 'buying or selling.' Why It Matters: After the tariff-induced sell-off began in the market, the S&P 500 index has turned positive for the year with a 1.53% year-to-date return. The Dow Jones Industrial Average was up 0.62% and the Nasdaq 100 advanced 2.16% in the same period. Despite falling into the bear market territory, the markets have shown resilience as the President Donald Trump-led administration has successfully managed to strike a deal with the U.K. and a 90-day truce with China. Ryan Detrick from Carson Research highlighted in an X post that the 'bear market isn't fully recovered yet, but it is close.' According to the data shared by him, the bear markets between November 1980 to August 1982 and March 2000 to October 2002 staged the quickest recoveries, within three months. 'Should it happen soon, this will be the quickest recovery ever from a bear or near bear market.'Thus, Munger's message of showing patience and waiting for compounding to work is representative of this market recovery. Read Next: Hasbro, MGM, and Skechers trust this AI marketing firm — Invest before it's too late. Deloitte's fastest-growing software company partners with Amazon, Walmart & Target – Many are rushing to grab 4,000 of its pre-IPO shares for just $0.30/share! Image Via Shutterstock Send To MSN: Send to MSN UNLOCKED: 5 NEW TRADES EVERY WEEK. Click now to get top trade ideas daily, plus unlimited access to cutting-edge tools and strategies to gain an edge in the markets. Get the latest stock analysis from Benzinga? This article Charlie Munger Once Said, 'The First Rule Of Compounding Is To Never Interrupt It Unnecessarily' — Now His Wisdom Rings True As The S&P 500 Surges 220% Over 10 Years originally appeared on
Forbes
14-04-2025
- Business
- Forbes
Sports Investors Are Betting On Growth Despite Tariff Wars
In the world of high finance, tariffs rarely get the spotlight for their second-order effects. They're cast as macroeconomic chess moves—levers of diplomacy, tools of retaliation, or bulwarks of domestic protectionism. But beyond the noise of headlines and hearings, tariffs have a funny way of influencing where capital flows. And increasingly, it's flowing toward experiences, not goods. Call it the 'Experience Economy Advantage.' As tariffs raise the cost of goods and create turbulence in global trade, smart investors are repositioning—toward service-driven, resilient sectors like sports and entertainment. Peter Mallouk, CEO of Creative Planning, one of America's largest independent wealth advisors, offers a clear-eyed take on tariffs: 'The best-case scenario is a global reset—where negotiations produce a slightly more favorable balance for U.S. workers without escalating into an economic war,' he said. 'But the worst case is higher tariffs across the board. That scenario hurts consumers and corporations alike.' When goods get more expensive—think shoes, phones, toys—investors take notice. But here's where things get interesting: service businesses, sports properties, and tech services are largely insulated. No container ships. No customs. Just consumer demand and intellectual property. 'Tariffs tend to be on goods,' Mallouk explained. 'They don't hit sports teams. They don't hit musicians. They don't hit tech services. That's why you're seeing capital migrate into these areas.' For decades, owning a slice of a professional sports team was a billionaire's flex. Today, thanks to the rise of private equity funds and fractional investing platforms, that door is cracking open for accredited investors. 'In recent years, we've seen funds formed around sports and entertainment,' Mallouk said. 'That trend has accelerated—and tariffs would only add fuel to the fire.' It's not just about prestige. Sports franchises are delivering real returns. According to a 2024 Sportico report, the average MLB franchise has more than doubled in value over the past decade. Private equity groups are circling everything from team ownership stakes to sports-adjacent tech—fan engagement platforms, data analytics firms, even stadium operations. 'This is truly a renaissance era in sports, that was born from technological innovation. It's unlocked all kind of investment opportunities and potential,' said George Pyne, Founder & CEO of Bruin Capital, an international sports investment firm. Beyond sports, service businesses are emerging as stealth favorites in a tariff-prone world. Whether it's hospitality, wellness, or high-touch experiential travel, these businesses are lean on goods and heavy on human capital. Why the surge in interest? Because experiences scale differently. They're resilient to supply chain shocks. They're aligned with shifting consumer values. And perhaps most importantly—they're hard to commoditize. As McKinsey put it in their recent report on modern loyalty, 'Brands that deliver emotional engagement through experiences earn deeper and more durable loyalty.' Mallouk called the movement to private assets, 'The democratization of alternative investments.' 'Years ago, private equity was the playground of institutions and ultra-high-net-worth individuals,' he said. 'Today, we're seeing funds with minimums of $50,000 or $100,000—accessible to accredited investors. Pooling through advisory firms opens even more doors.' 'Where we see sports is very comparable to where the private equity industry was with the software industry following the great financial crisis. It could be a once-in-a-generational opportunity," Pyne added. And it's not just sports. Private real estate, private lending, niche service platforms—all are gaining traction as investors seek diversification in uncertain markets. The kicker? These investments aren't directly exposed to tariff headwinds, but they often benefit from the consumer behaviors tariffs indirectly shape. Mallouk also flagged a macro wildcard few are discussing: the U.S. bond market. 'China and Japan are the two largest foreign holders of U.S. bonds,' he said. 'If tensions escalate, they could retaliate by offloading treasuries. That would spike interest rates and drive up the national debt.' In that environment, the allure of tangible, uncorrelated assets—like a stake in a growing sports league or a cash-flowing service business—only grows. Tariffs are a blunt tool. Their collateral damage is often slow and sprawling. But for savvy investors, they're also a signal—a nudge toward sectors that operate above the fray. Sports. Services. Experiences. These are the categories that resonate not just in portfolio performance, but in life itself. As Mallouk put it, 'Eventually, capital flows where it can find safety and upside. Right now, that might just be in the bleachers and backstages, not the factories.'
