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Hi there,

It’s been quite a week in the world of business. While we don’t have fresh insight on what’s happening over at Twitter (ahem, X), we do have your weekly dose of economic and market news for values-aligned investors. Here’s what we’ve been watching:

  • 📈 Interest rates: “The Fed’s Hot Pause Summer” is over, NPR declared yesterday as the Federal Reserve raised interest rates by another .25% to a 22-year high of 5.5%. While inflation is on the decline, it remains higher than where the central bank wants it to be, with the Fed’s Powell keeping the door open for more increases this year.
  • 🌎 US and global economy show grit: The US economy grew 2.4% in the second quarter, much faster than expected and defying recession warnings. In its latest report, the International Monetary Fund (IMF) bumped up its expectations for global growth in 2023 and 2024 to 3%, saying the global economy is proving resilient, although growth remains weak by historical standards. For a lighter take on the state of the economy, we embrace the Axios theory that Girl Power is keeping it afloat.
  • 💲 Earnings reports keep rolling in: While some sectors have been struggling, General Electric reported better-than-expected numbers thanks to rising sales of jet engines and wind-energy turbines. Unilever, which is often seen as a bellwether for the global economy, profited from price hikes last quarter but says inflation has peaked — it turns out consumers will only pay so much for ice cream even in record heat. Meanwhile, mixed results from big tech firms underscore the competitiveness of the digital ad market and the intense pressure to show results from AI investments.

We have more news for you below, plus an important update on the future of FWIW. Keep on scrolling and stay cool out there, folks!

News you can use

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  • Online shoppers (not to mention companies large and small across the country) are breathing a sigh of relief because a tentative deal between UPS and its union means that deliveries of sneakers, dog toys, and laundry detergent should continue uninterrupted. News of the deal came just days before the Teamsters union was set to strike, potentially disrupting supply chains everywhere. Gaining wage increases, more full-time jobs, and new workplace protections, the Teamsters are touting the deal as a win that will likely inspire other unions.
  • Yesterday was the first ever Methane Summit at the White House as the US government takes on the greenhouse gas 80 times more potent than carbon dioxide. According to Reuters, companies participating in the summit included Honeywell, Teledyne, Schlumberger-backed GHGSat, and nonprofit Carbon Mapper. This week, the administration also announced $350 million in funding to monitor and reduce methane emissions from oil and gas companies as it prepares stricter regulations for the sector.
  • Big car companies are betting that doubling the number of fast chargers available could spur EV sales. Seven major companies — BMW Group, General Motors, Honda, Hyundai, Kia, Mercedes-Benz Group, and Stellantisformed a $1 billion joint venture to build 30,000 chargers in the US and Canada.

Some personal news…

We wanted to take a moment to thank each and every one of you for reading FWIW. We’ve been truly inspired by the exceptional reception the newsletter has received and hope that our weekly newsletter has opened your eyes to new opportunities and understanding and has helped build your confidence as you invest.

That’s why it’s so difficult to inform you that this will be our final issue. While we have a large (and growing) audience that opens and reads our newsletter (again, thanks!), the headwinds facing the newsletter sector and the business model have proven more challenging than we had hoped when we launched. While we will not be appearing weekly in your inboxes, we will keep the FWIW website going so you can access all of our resources and links. With that in mind, we thought you might find it helpful to have a compilation of the long-term investing ideas we’ve covered in FWIW with these 9 tips…

9 tips for being a successful long-term, values-aligned investor

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If you’re relatively new to investing, you know it can be confusing and intimidating at the start. There’s so much information and advice out there that it’s hard not to question whether you’re doing the right thing.

For our final edition of FWIW, we decided to condense the most fundamental rules of being an investor seeking gains over a long period who also wants their portfolio to reflect their own values.

If you’ve begun your investing journey, give yourself a much-deserved pat on the back. You’ve already set yourself on the path to securing your financial future. We hope these steps offer you some clarity, so send them to anyone who might be wondering where to start.

1. Pay off expensive debt and build an emergency fund

Before you start putting your money into investments like stocks and bonds, it’s smart to get your finances in order. Experts like Dave Ramsey recommend paying off loans with high interest rates (like credit card debt) and ensuring you have enough savings tucked away for a rainy day. With an emergency fund worth several months’ expenses, you have easy access to money when life takes an unexpected turn, and you won’t need to sell any of your assets at a possible loss or miss out on future returns. If you’re looking for more on these topics, previous FWIW editions covered attacking your debt and where to keep your emergency cash.

2. Identify your values

As you start to choose your investments and build your investing plans, it’s important to make a mental (or physical!) note of the social or environmental issues that matter the most to you. Portfolio manager Matthew Blume recommends reviewing the 17 Sustainable Development Goals set by the United Nations, but we know that everyone brings their own personal eye to what they value. You may care about fair and ethical leadership, supporting your local community, climate change, workers’ rights, gender equality, aligning your investing with your faith, specific business sectors like wind energy, or any number of other issues and perspectives. If you are looking for some data to see how a company is performing in a particular area, this list of data resources may be helpful. Even with all of this data, it’s hard to find a firm doing a perfect job on all these matters, but plenty are making progress, while others are uniquely mission- and impact-driven. This will guide your research and choices.

3. Diversify your assets

Experts say the best way to minimize risk and losses as an investor is owning a variety of investments. When you spread your money and don’t put all your eggs in one or a few baskets, your portfolio benefits from any areas performing well, and no single piece of news or business/economic development can deliver an enormous blow to it. A useful rule of thumb espoused by author and billionaire Ken Fisher is that no single investment should make up more than 5% of your portfolio. Learn more on diversification and asset allocation here.

4. Screen + divest or engage

Positive and negative screening is the basic process all values-aligned investors use to build portfolios they can be proud of. When you screen companies for positive qualities, you look for the top performers on different sustainability issues. For instance, if you care about gender equality, you may consult a ranking like Equileap’s or choose a fund that does the job for you, like the Impact Shares YWCA Women’s Empowerment ETF or Impax Ellevate Global Women’s Leadership Fund. Negative screening involves weeding out stocks that don’t align with your values. You may do your own research and look at rankings and studies to identify bad actors, like the biggest greenhouse gas polluters or companies with no climate or net-zero targets. You can also use a tool like As You Sow’s that analyzes and ranks individual funds. Once you screen for negative characteristics, you can choose to either divest and sell those stocks or stay invested and push for change by using your shareholder vote.

5. Look for strong fundamentals and avoid trading, speculation, and FOMO

As a long-term investor, experts say your main strategy should be to buy quality stocks and hold them. Of course, you can always sell individual assets if the situation calls for it, like rebalancing your portfolio or a big change in a company’s future, but for the most part you want to do as little as possible with your shares. You can assess whether a company is financially strong and its fundamentals are good by reading quarterly earnings reports, which include information like profits and revenue. You can also listen in to earnings conference calls and follow business news coverage and Wall Street analyst takeaways and ratings. What you want to avoid is trying to make a quick buck by quickly buying and selling a stock or buying stocks because social media is abuzz with talk about them.

6. Keep your costs low

As they say, “You have to spend money to make money,” and this is true for investing too, but experts note that keeping an eye on expenses — like commissions paid to your broker when you buy and sell assets, broker fees for other services, and ongoing management fees (expense ratios) when you own a mutual fund or ETF — is important as you grow your nest egg. These costs may seem small and insignificant at first, but over time they add up and can dramatically reduce your portfolio’s growth as seen in this chart that assumes a 9.3% annual rate of return. Check if any fees you’re paying are above the average and if they are worthwhile to you or can be avoided.

7. Be tax-efficient

Different asset types, like stocks, have different taxation rules, and experts say being smart about how you invest can save you some money. If you want to learn about various strategies to reduce what you owe, we have pulled together recommendations from a number of experts.

8. Don’t panic sell

Volatility is a normal part of the stock market, and when the market crashes, as it inevitably does at different times, experts recommend staying calm and sitting tight. If you cash out and decide to wait on the sidelines you may miss the start of the recovery, which can have a huge long-term impact on your returns. Timing the market is incredibly hard even for the pros and isn’t a wise move. As investing legend Jack Bogle said, “The idea that a bell rings to signal when to get into or out of the stock market is simply not credible. After nearly fifty years in this business, I don’t know anybody who has done it successfully and consistently.” As this chart from Hartford Funds shows, the majority of the best days for the market take place during bearish times, and missing those days is costly.

9. Be consistent

So you know to stay invested even when the market is down, but experts like Nick Maggiulli recommend you should also keep buying during such times. Although it goes against all your instincts, being disciplined and consistent with your investing regardless of how the market is performing stops you from trying to time the market and putting in lump sums at the wrong time. A popular strategy some experts recommend you consider is known as dollar-cost averaging.

We hope that this summary is helpful and that the lessons we have tried to bring forward in FWIW continue to be helpful as you contemplate financial decisions moving forward.

Thanks for all of your support and for the time you’ve spent with us.

Before we go -

We’ve put our hearts and soul into FWIW and, before we go, would love to hear from you. If you have thoughts on how FWIW impacted your thinking, elements that you thought were particularly helpful, items you wish we had covered more often, etc., we would love to hear from you.

For every reader who shares their thoughts (and to keep with our ongoing mission to make an impact in whatever way we can), we will be planting a tree 🌳

** FWIW team members own shares of GM, Schlumberger, Unilever, and UPS. Want to learn a bit more about the writers behind FWIW?