Every hardcore fishing angler knows the Florida Keys is the sport fishing capital of the world.
The 125-mile-long archipelago curves westward from the southern tip of Florida between the Florida Bay of the Gulf of Mexico and the Atlantic Ocean. Both sides provide an unrivaled diversity of fishing opportunities, including the most sought-after salt water game fish.
And a heck of a lot of fun!
We had the opportunity to spend a weekend fishing both sides of the Keys. We had a blast and caught a ton of fish. Here is a small sample of our keepers:
A successful Florida Keys fishing trip comes down to three components: knowing where the fish are in the ocean, knowing what to fish with, and an experienced guide to make it all happen. Since it was red snapper "season" (by law there are only six days per year that recreational fisherman can catch red snapper), our guide, Captain Wes of Two Conch Charters put us right on the fish around a shipwreck in 150 feet of water just off of a reef. In addition to red snapper, we caught black grouper, black margate and giant amberjack. Needless to say our fish tasted amazing after the chefs at Castaways cooked them up.
Similar to a successful Keys fishing trip, creating an investment experience that meets your wealth planning goals can be simplified to three components:
Finding the fish is the hardest part. If you are fishing in an area with no fish, your experience will not be enjoyable and your dinner will not be nearly as good. You need to go where the fish are to be rewarded. In investing, your asset allocation (the mix of stocks, bonds, and diversifying alternatives such as real estate and infrastructure investments) will control most of your investment ride. For investors with more aggressive wealth planning goals, you may need a higher mix of equity versus fixed income and alternatives, i.e., you may need to fish in deeper and more treacherous water for bigger fish. Conversely, if you are more conservative, a higher mix of fixed income versus equity may be best; catching smaller fish on a swallow reef can be just as fun!
Once you have found hungry fish, they will bite on anything at times. But sometimes they need to be enticed with just the right presentation of bait to bite. Having a diverse tackle box and bait options is usually helpful. Similarly, investment selection within each asset class can be important. As an example, a portfolio made of globally diversified equities from the U.S., foreign developed markets and emerging markets is key to long-term asset growth. The U.S. equity may not always perform well; sometimes markets outside the U.S. equity market will outperform. Diversification can better prepare you for any outcome.
Not every fisherman is an expert in every body of water. Finding a capable guide that has the expertise to find the fish you want to catch and recommend, from experience, what tackle to use is invaluable. A good guide knows when to move to the next fishing spot and knows when to change bait when the fishing slows down. And a good guide knows when the wind may turn and waves become threatening so that you can return safely to shore. A good investment advisor can do the same thing by knowing what asset allocation and investment selection makes sense for your wealth planning goals over the long-term.
Whether you are fishing for fun or investing for long-term wealth planning success, getting the key components right are critical. Catching fish and successfully meeting your investing goals is much better than getting skunked in the boat and experiencing permanent losses of capital.