In the latest Take 5, Ryan Detrick, Chief Market Strategist, and Sonu Varghese, VP, Global Macro Strategist, challenge the conventional wisdom around who really qualifies as the “smart money.” While institutional investors have historically held that title, the hosts make a compelling case that in 2025, it’s the everyday investors — the so-called “mom and pop” — who are showing the discipline and resilience that define smart investing. The duo also breaks down recent market behavior, performance gaps between retail and institutional money, and the critical importance of having (and sticking to) a financial plan.
Key Takeaways
- Institutional Constraints Matter: Unlike retail investors with long-term plans, institutional managers often face short-term performance pressures, benchmarks, and investor expectations that limit their flexibility and can lead to poor timing decisions.
- Volatility is Normal, Not a Red Flag: Market pullbacks of 5%-10% happen regularly, and near-bear markets every few years. This year has been no exception, and a balanced portfolio is built with this in mind.
- Asset Allocation is a Risk Buffer: A diversified mix of stocks, bonds, cash, and other assets (like gold) isn’t just theoretical — it plays a critical role in helping investors stay invested through tough markets.
- Sticking to the Plan Pays Off: While headlines screamed doom earlier this year, staying invested has been the winning strategy so far. Pat yourself on the back — you are the smart money.
