It’s called the “Great Rotation.” Investors, weary from years of low returns, wary of any risk-on bet, beat up and still smarting from those hellish days when all asset classes correlated in a downwards spiral, are happy again and are pouring into equities.

Or are they happy? One look at the amount of money going back into equities would suggest yes. But as one of our clients astutely argued recently: we are in a new return environment. It’s no longer a risk-on, risk-off world that client would argue. It’s a world where we have to change the game of how we think about investing. We need to think long term. We need to see investing through the lens of who are the true stewards of investors’ money and what are the strategies that have enduring, long-term value.

In this Great Rotation, then, a higher premium should be put on a new kind of thoughtfulness. We know that markets rise and fall. The one constant should be is our commitment to truly sound principles of investing.

I write this because this is my fifth bull market. Or maybe it’s six. Depends how you count. I spent the first three as a journalist and the last two, or three, as a communications executive. I’ve seen great victories and stinging defeats.

In many ways, the last six years have been the most interesting. There’s nothing like a crisis to focus your mind – whether to recover from the damage done or to use the moment as an opportunity for brave, new thinking. We’ve helped our clients with both the good and the bad and built a company dedicated to providing thoughtful yet actionable solutions.

So, here we go again. Another rising tide in the markets. Will this time be any different? Probably not. Money will be made and lost. But there are always currents within the great flow, and surge, that look at things differently. That’s how we see how our own capabilities have evolved over the years: learning from all the rotations past to be smarter about helping our clients in good times. . .and challenging ones.

Best,

Montieth M. Illingworth
President, Montieth & Company
April 1, 2013