July 2025 | Goal-Focused, Plan-Driven, Long-Term Equity Investors
Market Update
No doubt it has been a rather tumultuous first six months of this very eventful year. I’d like to start this newsletter with a handful of timeless truths pertaining to successful wealth management—principles that guide our work together toward your goals. Following, I’ll provide some current commentary on the market.
General Principles
We are goal-focused, plan-driven, long-term equity investors. Our portfolios are derived from, and driven by, your most important lifetime financial goals, not any view of the economy or the markets.
We don’t believe the economy can be consistently forecast, or the markets consistently timed. Nor do we believe it is possible to gain any advantage by going in and out of the equity market, regardless of current conditions.
We therefore believe that the most efficient method of capturing the full premium compound return of equities is by remaining fully invested, all the time.
We are thus prepared to ride out the equity market’s frequent, often significant but historically always temporary declines. We believe that even during such trying episodes, our reinvested dividends will be buying more lower-priced shares—and that the power of equity compounding will be continuing, to our long-term benefit.
Current Commentary
If you looked at the equity market on the first trading day of this year, and not again until the end of June, you could be forgiven for concluding that not much— if anything—had happened. In fact, a great deal happened—but at least so far, to no lasting effect.
The S&P 500 Index made a new all-time high on February 19th. By April 8th, it had closed 18.9% lower. And even that doesn’t express the degree of sheer panic—there’s no other word for it—that enveloped the markets upon President Trump’s announcement (on April 2) of a dramatically increased tariff protocol.
The panic ended just as abruptly after Mr. Trump announced a 90-day postponement of most of the new tariffs. And in the seven weeks or so since then—buoyed by continued strength in the economy and signs that inflation may be continuing to moderate—the Index returned to the neighborhood of its early January levels.
As it virtually always is, the optimal course of action for long-term investors was simply to continue working your plan. That’s what we encouraged you to do. And as the second half of the year begins, that recommendation stands. Please don’t mistake this for an economic or market outlook. We have no such forecast for the next six months, any more than we did on January 1.
Our only forecast is that excellent businesses of the kind we own will go on innovating over time—increasing their earnings, raising their dividends, and supporting our clients’ pursuit of their long-term goals.
Panic doesn’t often seize the investing public as suddenly as it did in the first week of April, nor vanish as suddenly as it did the following week. Still, this episode can and should serve as a kind of tutorial.
Its lesson: investors succeed over time by continuously working their plan regardless of the current “crisis.” Others fail by reacting to negative events and liquidating even the highest quality equities at panic prices. We believe that’s always the fundamental choice in investing, and our mission—which we cherish—is to help you continue to choose wisely.
Friendly Reminders
One Big Beautiful Bill Act – This bill was signed into law by President Trump on July 4th, 2025 and contains many tax and spending policies. We are actively studying the provisions of this bill to understand its impact on our clients. More info to come.
Life Insurance – In the event that you have active life insurance policies, please reach out to us for a review. We are doing our best to cover these in meetings, but want to make sure we do not have any unforeseen lapses in coverage. As a newly independent firm, we do not have the same type of viewing/payment capabilities as before. Please reach out with any questions.
Social Security Fairness Act – Signed 01/05/2025, the act eliminates provisions that previously reduced Social Security benefits for persons receiving pensions from work not covered by Social Security. Examples of these individuals include teachers, fire fighters, police officers, and public workers. If you fall into this category, it may be prudent file for benefits that you are now eligible to receive. Please reach out with any questions.
Google Reviews – Please consider using this link to give us a review on Google. These reviews help us become more visible, credible, and to find and serve more clients like you.
PWA Portal – Here is a link to your PWA portal login. This portal is your one-stop shop to view your accounts, balances, and quarterly statements. If you are unable to login, please let us know and we will get you set up.
Thank you, as always, for being our clients. It is a privilege to serve you.
On behalf of your PWA team,
Brock Hedgecoke, CFP®
Financial Advisor