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JAN 2025
Annual CEO Letter to Clients
Tony Reilly, CEO
Dear clients,
Looking back to 2024, we’re grateful for the wonderful relationships we’ve built with clients around the country. I do not say this lightly when I say that I believe we have even more to look forward to in the upcoming months, years, and decades. It’s not just the journey that’s exciting, but it’s also the people that we get to do it with.
It has almost been a year since we moved to our new office in Dublin Bridge Park. We are proud to have grown to $2.2B, while maintaining a ratio of 2x support staff to financial advisors, ensuring we're proactively serving the needs of our clients (as of 12/11/24). Being named on Forbes 2024 Best-In-State Wealth Management Teams* along with hosting the Irish ambassador to the US in an intimate gathering come to mind as some of the most proud moments in 2024.
As investors, it’s impossible to know the future, but the ever-changing economic and geo-political landscape demands our attention. As we get into a few key points looking forward into 2025, we want to remind ourselves of the power of the market.
Be careful of saying, “this time is different”
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Markets will always cycle between euphoria and despair. Consider the differences in sentiment between 1999 and 2001 or 2007 and 2008. As long-term investors, be careful when you hear the infamous statement, “this time is different.” There will invariably be voices stating that the market will always go up or always go down.
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Look at inflation as an example. The Consumer Price Index (CPI) is a measure of the average change over time in the prices paid by consumers for a representative basket of consumer goods and services.
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The CPI in the 1970s vs. 2020s shows a similar story of spiking interest rates and while tumultuous at the time, we can look back in history knowing we have made it through these types of periods before. If we had hit interest rates north of 10% in this current cycle, every news headlines would say the world was ending, yet the market has been through this before.​​
Many of you may have had a 10%+ mortgage in the past. And we’ve had around 6-7% mortgage rates in 2024. While we expect the easing cycle to continue from the Federal Reserve (Fed), it may be a slower process than many people want. A resilient economy is a good thing, but the Fed will continue to watch the balancing act of inflation versus unemployment figures throughout 2025.​
We must understand the goal of the Fed currently is not to return to all-time low interest rates. Most investment houses agree that the Fed is aiming to find a neutral rate, estimated at 3.25-3.5%. This is obviously subject to change, but we must get our own houses in order, knowing that the times of 2.5% interest rates on loans and mortgages are likely not returning soon.
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We understand the pain of higher interest rates compared to the last decade. I always remind the next generation to be patient when investing. A mortgage at 6% isn’t the worst thing. We must adapt to the market conditions we are given, while being wise with our finances throughout these changing periods.
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Artificial Intelligence (AI), understand the hype
While AI will continue to be the topic of conversation, we believe the future of AI will be looked upon through a closer lens. We will likely see the narrative shift from hype to realistic metrics over the upcoming year. Rather than generalizing AI into an ethereal category, view the visual below, to see examples of the effects of AI across various industries.​​
Health Care
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Smart implants
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Medical imaging
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Pathology detection
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Personalized medicine
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Identify biomarkers
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New drug development
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Genomic data analysis
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Physician point-of-service tools
​Financials
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AI thematic fund offerings
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New trade pricing tools
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Generate client portfolio reviews
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Automated trade prices & execution
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AI portfolio management
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Increase trading velocity
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Product ideation & evolution
​Advertising & Digital Content
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Market efficiency
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Enhanced ad targeting
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Recommendation engine
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Higher ad conversion
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Ad auction dynamics
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Content creation
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Customized travel itineraries
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Video game development
​Energy & Industrials​
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Geological models
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AI-enabled microgrid & pipeline tools
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Energy usage analytics & trading enhancements
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Reservoir optimization
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Leak detection & track emissions
The AI leaders in chips, language models, and hyper-scalers have been the topic of most of the investment community. But as time goes on, we will be focusing on the downstream effects across all the sectors within the market. Yet, with any great innovation we see the cycle of initial hype often fade into reality as time goes on.
Cycle of Innovation
With the various industries impacted by AI, companies will begin to see if the cost of AI is worth the gains in efficiency; and we believe that we're still in the "Over-hyped" period of this disruptive technology. This period will likely shake out the losers and enhance the winners at an enterprise level. While many companies have increased their capital expenditures to compete in the AI space, investors will be looking to see if that investment is paying off over the coming years.
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It’s amazing to watch the continued innovation occur before us. As investors we will still need to be patient and realize that the effects of this innovation will take time to play out in our daily lives.
Thinking long-term
While we often focus on the short-term themes of the global markets, we must always fall back on our foundation. We are long-term investors. It’s pure nonsense if anyone tells you they can define what will happen in the next year, five years, or 10 years in the markets. We know in the next year there will be moments that cause short-term panic. We see them regularly in the market. Remember, the market has likely been through this before, just like inflationary periods. The below, chart reminds us of some of the global events the market has experienced.
​Past performance is not a guarantee of future results. An index is not managed and not available for direct investment. Source: Y-Charts. As of 12/11/24.​
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Warren Buffett, one of the most successful investors of all time, underscores the value of patience in investing: “The stock market is designed to transfer money from the active to the patient.” Buffett’s wisdom highlights that long-term investing rewards those who remain patient and focused on enduring value rather than reacting to short-term market movements.
In conclusion
We would like to thank you for your business and the trust that you place with us. We look forward to seeing you in 2025.
Thank you,
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Tony (Anthony) J. Reilly, CEO (LinkedIn)
Ascend Advisory Group, LLC
6767 Longshore St, Suite 300,
Dublin, OH 43017
614-784-6000
*2024 Forbes Best-in-State Wealth Management Teams: Awarded January 2024; Data compiled by SHOOK Research LLC based on the time period from 3/31/22 - 3/31/23 (Source: Forbes.com).
The Forbes Best-in-State Wealth Management Teams rating algorithm is based on the previous year’s industry experience, interviews, compliance records, assets under management, revenue and other criteria by SHOOK Research, LLC. Investment performance is not a criterion. Self-completed survey was used for rating. This rating is not related to the quality of the investment advice and based solely on the disclosed criteria.
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