Munson talks Star Wars and Diet Apps on Varney

November 26th, 2015 by


Albuquerque financial expert and Chief Investment Officer of Portfolio Wealth Advisors, Lee Munson, was invited by Varney & Co. to discuss the major earnings this week. “I love to get back to New York and talk shop with the crew at Fox Business. This was a Friday, the weather was great in the city, and my kids loved that I got to talk about Star Wars as they relate to Disney earnings,” said Munson after the interview. While New Mexico is his home Munson enjoys the occasional trip to Manhattan to give his opinions in person. “Nothing beats being live on the soundstage to feel the energy and excitement of live TV. Just remember that this is still entertainment and shouldn’t be confused with the long term investing we do for client’s.” While Munson has an eye to his client’s financial goals, he still likes to talk about current market topics. “It’s a great chance to discuss the topic of the day, but then include a little long term thinking people don’t always get from the typical market commentator.” For more information about how Lee helps client’s plan for retirement and spend more time on the mountain, email him at

Lee Munson on changes to Social Security that will hit some hard

November 23rd, 2015 by

Here are Lee Munson’s comments about his appearance on Yahoo Finance this week. “Anytime I get back to New York City I love to sit down and talk with Yahoo Finance about what I’m really passionate about. This week the new federal budget was signed with a surprise announcement about Social Security filing strategies. This was huge.” If you want to learn more about how the new changes to the law will affect your retirement income, contact Lee Munson at

Lee Munson and Liz Claman do a lightning round for fun

November 20th, 2015 by

We asked Lee to tell us a little bit about his interview with Liz Claman on Countdown to the Closing Bell, a Fox Business program on October 23, 2015.

“I’ve been doing interviews with Liz for a while. I started with her show After the Bell. One of the producers called me up and said Liz had a spot to talk about individual stock picks next Friday, would I be interested in joining her. Of course I said yes. While, in general I don’t buy individual stocks from my clients, I do have new clients transfer in securities that they bought elsewhere. What I decided would be the most fun is to pretend that a client just brought me stocks like Amazon, Microsoft, Pandora, and imagine me giving them some advice on what to do. This worked out great. We brought a lot of energy to the segment and for those out there that might find themselves over their head or realize maybe they don’t want to be individual stock pickers, I gave some great advice on how to reduce positions and replace them with low-cost exchange traded funds or index funds. For that, I’m grateful for the opportunity and hope to do it again soon.”

If you want more information about Lee Munson and how he can help you spend more time in the mountain, contact him at


Munson asked by Yahoo Finance to discuss Keystone, Facebook, and Social Security’s secret dealings

November 18th, 2015 by

Albuquerque financial expert and Chief Investment Officer of Portfolio Wealth Advisors, Lee Munson, was asked by Finance Editor in Chief, Andy Sewer, to discuss the top issues this week on Yahoo Finance’s Midday Movers. “This is a great web-based show on the most popular financial website in the country. We get to discuss the topics people are interested, and have the time to get beyond a soundbite usually found on cable TV. The bottom line is that you get time to develop an idea with no commercials cutting you off.” Munson also commented “Andy knows the topics I want to hit and creates the environment to make compelling content.” If you would like to talk to Lee about your financial situation and learn how to spend more time on the mountain, contact him at

Munson and Varney on October 2015 rally

November 16th, 2015 by

Albuquerque Financial expert and chief investment officer of portfolio asset management, Lee Munson, was asked his opinion on the biggest month in four years while on the Fox Business’s Varney & Co. on October 30, 2015. Here are Lee’s post interview thoughts:

“When I was asked by the producers to share my thoughts on what was turning out to be the biggest month in four years of course I jumped at the opportunity. Stuart is a great host and knows the market better than anyone else. You’ve got to remember this guy started the CNN News Division back in 1980. He got an award for his incredible reporting for the crash of 1987. Anytime there is a historic milestone in the market there’s no place I’d rather be than on his show talking about it. One of the things that I wanted to point out as he kept asking me about the market’s big rise was liquidity. Let’s face it, on October 30; small caps were not advancing in the same way as large cap securities. Now for those that don’t know what that means let me put it in plain English. If small caps aren’t leading the rally that means we don’t have enough liquidity to go into those smaller names. Liquidity is like electricity; it’s a thing that keeps the market lights on. Anytime, you see signs of less liquidity by virtue of slower relative momentum in small cap asset classes money managers like me that run globally diversified portfolios start to get a little leery and we might do things like sell stock versus bonds in a perceived bull run to meet our client’s cash flow needs. We also will be a little bit more hesitant about putting new money in the market especially if clients just send you fresh cash. Overall you need to get your money invested, but on that particular day we just wanted to wait a few days to make sure there wasn’t a shoe that was about ready to be dropped, but hey it was Friday. We all had a lot of fun and I cracked a few jokes with Stuart right at the end.”

If you have more information about how Lee Munson can help you spend more time on the mountain and get the cash flow you want to live a great lifestyle, contact him at

Private 100 Press Release:

November 3rd, 2015 by

ALBUQUERQUE, NM, Nov 2, 2015 – Portfolio Wealth Advisors (PWA) was recognized last week as one of the New Mexico Private 100 list based on 2014 revenues. Now in its 20th year, the NM Private 100 recognizes New Mexico’s top earning, privately owned, New Mexico-based companies. According to the Albuquerque Journal, this year’s New Mexico honorees are a diverse group, representing health care, retail, technology, energy and aerospace, but anchored by the construction and real estate industries, which collected 28 of the top 100 spots. This is the third year Portfolio Wealth Advisors has received this honor.

The Journal reported that NM Private 100 combined revenues for 2014 totaled $4.2 billion, representing an increase in $.3 billion over last year’s figures, and a reversal of trending revenue declines since the list was reintroduced in 2012. The companies collectively employ 9,105 individuals in the state of New Mexico.

Despite economic challenges, New Mexico’s private sector has many success stories, and companies on the list represent the building blocks of the state’s recovery.

Steven Keene, a managing partner for Moss Adams LLP, told the Journal, “We continue to see the Private 100 companies being a backbone for job growth and slowly helping New Mexico’s economy turn around.”

Portfolio Wealth Advisors was founded in 2008 as an independent Registered Investment Advisor with 225 million in client assets under management. First recognized in 2012 as the youngest firm to make the list, PWA has continued to selectively grow a client base in the Southwest. “Our success is based on delivering efficient and effective advice in the best interests of our client’s. We want client’s we enjoy spending time with. Business growth and professional satisfaction will always follow,” says Munson on the success of his firm. New Mexico is home to PWA’s founder along with Oklahoma City where Munson’s business partner and CEO is based.

Founder and Chief Investment Officer, Lee Munson noted, “I love doing business in New Mexico. That doesn’t mean it’s perfect, but if you want the best weather, quality of life, and a place to raise kids you will put up with the downside of a less business friendly environment.” When asked what would improve the business environment for companies like Portfolio Wealth Advisors, Munson had an unique response, “I have no desire to ‘fix’ Albuquerque and have it turn into a smog filled Salt Lake City or mimic the horrendous traffic of Austin.” Clearly, Munson is happy with his business, clients, and his decision to base out of New Mexico.

See the full Albuquerque Journal Business Outlook article for more information on the 2015 Private 100 Awards.

Twin Win Notes a double loser?

November 2nd, 2015 by

Every once in a while something sexy comes across my desk. Structured notes that claim to make money in an up or down market that will draw the attention of anyone feeling week or looking for a quick distraction over lunch. I love to read this stuff. Maybe there is still that little kid in me that thinks there is an option fairy that will leave money behind if I only believe.

This week another set of Twin Win Notes, issued by Societe General will be priced and sold to less savvy investors. The pitch? You can get the upside of the market if the SPX goes up. You get paid if the market goes down. Right there most people will stop listening and just say buy it. But the devil is in the details and I want to go through an example to show you why this can go all wrong pretty fast.

First, let’s talk about how these are sold to the general public, and keep in mind UBS just paid $19.5 million to settle false and misleading statements and omissions selling overly complex structured notes to unsophisticated retail investors. Read the SEC’s press release here. A broker calls you up and says they have a magic note, debt issued by Society Generale, that credits interest not based on interest rates, but on the movement of the S & P 500 Index, or SPX for short. They may not mention the dividend yield is not included, since this is needed to pay for the hedges the note provides. So, at the very start this isn’t a substitute for an index fund that tracks the index like SPY that pays a dividend you can either take in cash or reinvest as you see fit. Getting back to the pitch, you are given a few cherry picked scenarios. At maturity, if the SPX (in price only, not the total return after dividends) is up 30%, you receive 130%. If the SPX is down 48% (this is the very edge of the lower bound I will explain in a moment), you receive 148%. If the SPX is down 50%, just 2% lower than a 148% payoff, you receive only 50% of your initial investment.

Come on! Wasn’t there a clue right there? If 6 years from now the total price return of the SPX is down 48% you get 148% return, but if it is down 50% you get 98% less and lose half your money? Do you feel this seems more like a parlor trick of some bet you would read about in a Michael Lewis book? Just remember that you are buying a bond linked to derivatives. While I can say it as simple as buying an underlying index, then buying and selling a few put options, it’s a little more complex than that.

Second big idea outside of how they are sold as head you win tails you win, is that they don’t protect your principle. If over the observation period of 6 years, the SPX declines more than 48%, you get “knocked out.” That is a fancy name for all bets are off. At that point, no matter what happens to the SPX, at the end of the 6 years you will get the performance, minus dividends, of the SPX, good bad or ugly. I get it. What are the chances of the SPX going down more than 48% over the next 6 years? Not huge, but we simply don’t know that today. Thus, we are buying a complex structured note that right off the bat makes us comfortable and greedy by the promise of a payoff even if the market is down years from now. So why not take a shot?

That leads us to the third and most important point. What is your motivation? See how this product seems to promise different things to different people? I would venture to guess it is designed to appeal to multiple emotions of the same investor. Here are the profiles that is not right for, in my opinion.

I want more yield!

We always look for bond substitutes for cleint’s in a low yield environment. However, the protection of principle is a key feature we seek when going off the basic stock bond allocation. I love a principle protected note or annuity that can have an alternative crediting reference rate like the SPX. But I still need the principle protection. This doesn’t do that if things get too crazy in the market over the next 6 years, even it that period is over quickly like a flash crash. If you want to trade your safer bond assets to take the risk of the market providing your interest crediting, make sure whatever that product is still protects your principle no matter what that underlying index is. If not, why bother?

I am bullish on the market!

Then buy a cheap index fund and push the factors that create higher expected returns. Why would you lock up your money in a structured note for years, get a bad tax treatment (remember this is debt and treated as current income, not long term capital income), and not even collect dividends? If the market is flat during the 6 years, you could have at least collected dividends versus a 0% return if the price of the index doesn’t change.

I think the market will go noplace!

This is the worst thing you can do. If the market is flat – the return is 0%. Remember you have to see the SPX move up or down to get a positive return. Just not too much on the downside or you are at the whims of the market. So, it doesn’t make you money in a flat market.

I want stock exposure but less risk!

STOP! That is great! We all want that. The most efficient way to do that is have a balanced portfolio of stocks and bonds. You get all of the benefits of diversification and asset allocation, but with less risk since you mix in bonds to reduce volatility. What is even better is you can rebalance over those years to sell stock when it becomes to large a part of the portfolio. You sell stock and buy more bonds. When stocks drop and bonds are too large in your allocation, you sell bonds and buy stocks. What a nice way to naturally buy low and sell high!

The bottom line is that there are more effective ways of expressing our fears and hopes for the market without locking up your money in a complex vehicle that in the end won’t protect principle. Don’t get me wrong, our firm loves to look at alternative strategies that increase cash flow, safety of principle, and improve performance for our more conservative investors. However, we prefer to look at an annuity that guarantees principle and can provide cash flow if we are going to stray away from plain vanilla globally invested stock and bond portfolios.

The Twin Win notes are 6 years long. Right off the bat that seems like a long time to have a complex set of rules to be locked into. Simply

Lee Munson “Millionaires Next Door”

October 28th, 2015 by

Lee talks about his previous trading career and how he ran hedge funds that had both long and short positions. He now runs a business that only trades and invests from the long side of the market, he likes to think of his clients as the engineering “millionaires next door.” He believes that there is no magic box no holy grail. He believes value comes from buying things that are fairly valued next to their peers.

Lee Munson RISK

October 21st, 2015 by

Lee comments on the risk that is creeping up in the fixed income security market. He cites the Pimco total return fund that has many emerging market bonds in it. Most investors don’t understand this type of risk. Lee and Bubba agree the growth in the past six years is very limited when you take away buybacks and mergers. There is profit but it is being driven by the Fed’s policies.

Lee Munson The FED

October 14th, 2015 by

Bubba and Lee comment on the role of the Fed in the U.S. securities industry. Lee talks about the Fed’s record and notes that they have made many mistakes in the past and that the absolute size of their positions is difficult to get your hands around. Lee believes that the Fed probably needs to have a rate increase so that they can deal with the next recession. He believes that it is only a matter of time until the recession hits.

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