There's Often More to the Story

You may not be old enough to remember this, but in the late 20th century there was a time when millions of Americans made a point of eating lunch near an AM radio—just so they wouldn’t miss the daily broadcast of Paul Harvey.¹

 

In about 20 minutes, Harvey would deliver the day’s headlines along with a few human‑interest stories, all in one of the most trusted voices in broadcasting. One of his most popular segments usually began with hardship. He’d describe a young person who had failed in school or business, or someone told they’d never walk again. Then came the signature moment: “the rest of the story.” The struggling student became a business success. The injured patient became an Olympic champion or Nobel laureate. Without those humble beginnings, the triumph wouldn’t feel nearly as powerful.

 

But storytelling works both ways. As financial author Nassim Nicholas Taleb famously observed, the life of a turkey on an American farm can look pretty wonderful—right up until Thanksgiving.² Leave out part of the story, and the conclusion changes entirely.

 

This kind of careful framing shows up frequently in the world of investing. When financial pundits tell the “story” of a hot investment, they make a series of choices: where the chart begins and ends, how the axes are scaled, and which other investments are included for comparison. With just the right selections, a graph can be made to tell almost any story its creator wants.

 

For example, it’s possible to “prove” that gold is a better investment than the S&P 500 by choosing a start date when gold was emerging from two decades of poor performance while stocks were coming off an extended period of strong gains.³ Change the timeframe, and the conclusion can flip entirely.

 

The technology sector offers another illustration. Indexes like the Nasdaq 100 have delivered eye‑catching gains in recent years. But zoom out a bit, and you’ll see that performance over the two decades prior was far more modest—and included periods of significant decline.

 

In theory, moving money from one top‑performing asset to the next sounds appealing. In practice, the odds of consistently identifying winners ahead of time are extremely low. Markets don’t move in straight lines, and yesterday’s star is often tomorrow’s disappointment.

That’s why diversification remains such a powerful strategy. A well‑diversified portfolio increases your chances of capturing unexpected gains—the pleasant surprises—while helping to reduce the damage that can result from putting too much faith in any single investment during inevitable market corrections.

 

So, when a chart or headline seems to “prove beyond a doubt” that now is the moment to jump into the next high‑flying investment, remember that you’re only seeing part of the story. The framing has been carefully chosen, and the future remains stubbornly unpredictable.

 

We bring experience and perspective to this process, helping you select a thoughtful mix of investments aligned with your unique goals and risk tolerance. Before acting on the latest hot tip, it’s wise to talk with your advisor—to understand the rest of the story and determine whether the move truly serves your long‑term financial interests.

 

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