Upon a quick web search of “I’m an investor, what should I do in 2023?” a wave of options appear on what an investor ‘should’ do in the year ahead. Looking back at what the markets were doing, 2021 ended with Crypto enthusiasts in full swing and Bitcoin being above $50,000.1 Stocks were trading just below all-time highs and interest rates hadn’t been raised since 2018 by the Federal Reserve.1 However, 2022’s numbers continued to tell a grim story until the year’s end. As of December 30, the final trading day of 2022, the Dow finished down 8.78% for the year, the S&P 500 was down 19.44% for the year, and the Nasdaq Composite finished down 33.10% for the year.2 While Bitcoin may have started out January 2022 strong and nearly twice as valuable as it was when compared to January 2021, it quickly lost nearly all of its gains before the month had even ended.3
The Securities and Exchange Commission (SEC) was also buckling down on social media influencers this past year who were profiting from their popularity by posting ads promoting crypto. As of October 2022, a top fashion icon was fined for failing to disclose an Instagram endorsement that was paid for by a Crypto company.4 That same month, the SEC announced they had reached a million-dollar settlement over the post, and that influencer was not allowed to promote any cryptocurrency for three years.4 As 2022 was winding down, the SEC and DOJ (Department of Justice) were also charging seven social media influencers with using social media to commit securities fraud which allegedly netted them more than $100 million in illicit gains.5 The scheme went back to January 2020 when influencers were using social media platforms to manipulate exchange-traded stocks and actually promoted themselves as “successful traders,” according to an SEC press release.5 The scheme encouraged its followers to buy the stocks that they had also purchased, however, failing to disclose to those same followers their plan to sell the shares once volumes rose. The investigation as of January 2023 remains open but the SEC has continued to warn investors to be careful in following online unsolicited advice.
With increased uncertainty and potential lack of trust surrounding the financial industry as we begin 2023, what can investors do? Matson Money has two recommendations to kick off 2023.
First, set a new intention for the year when it comes to your family’s financial future. Our intention is to educate investors to stay calm and not panic. “We may not know where the market is going in the next 20 minutes, but it isn’t about that. Investors should focus on the next 20 years instead – and plan a strategy around that,” said Mark Matson, Founder and CEO of Matson Money. It’s never the right time to panic and being aware of potential biases can be the difference between being a prudent and disciplined investor or losing in the market. Here are three investment biases to recognize and avoid.
Second, when it comes to investing, we propose taking President Reagan’s wisdom of “trust but verify” and taking it one step further by verifying before you trust. Vetting the validity and efficacy of alternative investment programs can be your first defense against potential fraud. There are four pieces of information any potential investment provider should provide you before doing business with them:
- Third-party custodian information
- Audited Financial Statements
- Standardized Global Investment Performance Standards (GIPS®) verified returns
- Fines and Penalties disclosures
Finally, arm yourself with knowledge by attending Matson Money’s American Dream Experience. The American Dream Experience is a free breakthrough financial training where investors can discover academic investing principles versus gambling and speculating with your life’s savings. Begin the journey to discover your true purpose now.
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS.
This content is based on the views of Matson Money, Inc. This content is not to be considered investment advice and is not to be relied upon as the basis for entering into any transaction or advisory relationship or making any investment decision.
This content includes the opinions, beliefs, or viewpoints of Matson Money and its Co-Advisors. All of Matson Money’s advisory services are marketed almost exclusively by either Solicitors or Co-Advisors. Both Co-Advisors and Solicitors are independent contractors, not employees or agents of Matson.
Other financial organizations may analyze investments and take a different approach to investing than that of Matson Money. All investing involves risks and costs. No investment strategy (including asset allocation and diversification strategies) can ensure peace of mind, guarantee profit, or protect against loss.
1. Bloomberg Wealth: Investing Tips for 2023 published December 22, 2022. https://www.bloomberg.com/news/newsletters/2022-12-22/should-i-buy-stocks-investing-tips-for-2023-after-a-brutal-year
2. Pound, Jesse and Samantha Subin. Stocks fall to end Wall Street’s worst year since 2008, S&P 500 finishes 2022 down nearly 20%. Published December 30, 2022. https://www.cnbc.com/2022/12/29/stock-market-futures-open-to-close-news.html
3. Bitcoin Price History: 2009-2022 published October 31, 2022. https://time.com/nextadvisor/investing/cryptocurrency/bitcoin-price-history/
4. After Kim Kardashian’s SEC settlement, influencers working with brands could face more scrutiny – and fines. Published October 4, 2022. https://digiday.com/marketing/after-kim-kardashians-sec-settlement-influencers-working-with-brands-could-face-more-scrutiny-and-fines/
5. SEC Charges Eight Social Media Influencers in $100 Million Stock Manipulation Scheme Promoted on Discord and Twitter. U.S. Securities and Exchange Commission. Published December 14, 2022. https://www.sec.gov/news/press-release/2022-221.