Michael Wagner on Family Wealth Report’s Wealth Talk: How To Keep Investment Emotions in Balance

Between the GameStop frenzy earlier this year, the recent Archegos Capital Management scandal and the surges in bitcoin prices and SPAC IPOs, there has been plenty of financial trends and headlines to throw investors off balance. To help investors better understand these market events and learn how to effectively navigate them, the Family Wealth Report recently invited Omnia Family Wealth Co-Founder and Chief Operating Officer Michael Wagner to join its Wealth Talk video series.

According to Wagner, this year’s market drama is largely attributed to a large increase in the animal spirits of the market, representing investors’ real hunger for returns and a game-playing mentality when it comes to investing.

“What you are seeing is a really strong hunger for risk and return, and we try to temper people’s expectations in terms of what’s going on,” Wagner explains. “People are seeing a lot of money being made, it’s very sensational and there’s real fear of missing out. In the bitcoin world, they call it FOMO, but I think that it’s a very good description of what’s going on with a lot of folks.”

Despite the urge to follow the latest market trends, Wagner recommends investors focus on what they can control, specifically the amount of risk they incorporate in their portfolios. He adds that concentrating on returns instead of risk is often where investors get themselves in trouble.

“I am seeing a lot more greed today than I am fear, and in times like this, I think it is our role to be somewhat contrarian and to introduce, for lack of a better term, fear to these conversations so that people reevaluate the risks that are in front of them because you tend to hear only when it is going well,” says Wagner. “We are not trying to scare anybody, but we are trying to pour a little cold water on what’s being discussed out there.”

Click here to watch the entire Wealth Talk video.