Broadway Bank Wealth Management focuses on selecting the right investment strategy for your needs
By Kelly Corbiere, CFA, CMT, CFP® and the Portfolio Managers at Broadway Bank Wealth Management
Bitcoin, the original cryptocurrency invented in 2008, has been attracting headlines as an extremely popular and widely followed investment opportunity. Bitcoin is also a technology and could be an inflation hedge, a tool to guard against political risks, a vehicle to democratize monetary policy, an anonymous method of transacting for scrupulous and unscrupulous players alike, or an investment. In short, the reasons someone may want to hold Bitcoin are abundant.
A common question we get is whether Bitcoin is a good investment. As with any investment, the answer depends on what it is worth relative to its price. Investments are traditionally valued based on the cash flows they generate. If the value justified by cash flows is more than the current price, it signals that investors should buy. The issue with Bitcoin is that it does not have cash flows as a business does, making it impossible to value using traditional models. Without a value that is anchored in economics, the price of Bitcoin moves in response to investor behavior which is motivated by factors that are difficult to predict or quantify making it a speculative investment. In this context, “speculative” means the basis for the investment decision is based more on assumptions than on hard data, well-established relationships among quantifiable factors and prior experience in similar scenarios.
The long-term price trend for Bitcoin has been generally positive. However, its volatility has been 15 times higher than that of the US dollar in foreign exchange markets, which are considered volatile in their own right. Bitcoin has experienced seven drawdowns of 70% or more in the last decade compared to just one drop of that magnitude for the S&P 500 over almost a century. Bitcoin has experienced four bear markets, defined as price drops of 20% or more, so far this year. It lost 14% during a single hour of trading during April 2021. One Wall Street firm calculates that if you missed the 10 best days for Bitcoin between 2013 and 2019, the return on your investment would be an average annual loss of 44%.
Bitcoin is no longer unique and the number of risks to its dominant position are growing. Thousands of similar crypto assets exist because barriers to entry are minimal. Although Bitcoin remains the largest cryptocurrency based on market capitalization, its market share has fluctuated wildly since its launch. Some of Bitcoin’s competitors have arguably superior technology. Central banks are also entering the game with the launch of their own digital currencies that may serve as formidable substitutes for Bitcoin over time. Moreover, tightening regulation, taxation and counterparty risks (as evidenced by theft directly from exchanges) offset some of the benefits of owning cryptocurrencies.
Bitcoin is certainly a disruptor and has gained legitimacy as its uses have broadened. Whether Bitcoin will continue its reign as the most widely used cryptocurrency over the long-term is less than certain. Neither the risks nor potential returns are easily quantifiable. A speculative position in Bitcoin could result in either large gains or losses for short-term and long-term investors alike. This exemplifies the caution frequently given to investors that past performance is no guarantee of future returns. While we are bullish on the blockchain technology behind Bitcoin, we prefer to obtain exposure to its application to cryptocurrency indirectly via companies that are beginning to use, accept or trade cryptocurrencies such as PayPal, JPMorgan and Bank of New York Mellon, to name a few. The crypto market is still in its infancy. We submit that investors seeking to protect their wealth carefully research investments in companies profiting from increased use of cryptocurrencies, because for now that is the more prudent way to gain exposure rather than holding substantial positions in the cryptocurrency itself.
For 80 years, Broadway Bank has been an integral part of South Central Texas, evolving into one of the largest independently owned banks in Texas with more than $4.6 billion in assets and nearly $3.0 billion in Wealth Management assets. Broadway Bank offers a full range of financial services including personal, private, business, mortgage banking and wealth management. Broadway Bank is committed to enhancing the banking experience through leading edge technology. With financial centers across San Antonio, Austin and the Hill Country, Broadway Bank delivers modern banking, locally sourced and personally delivered.
Kelly Corbiere
Jeff Nelson
ABOUT THE AUTHORS:
Kelly Corbiere has more than 20 years of experience in investment management. Prior to joining Broadway Bank as a Senior Vice President, Portfolio Manager. She worked as a global equity analyst and prior to that she was an investment manager in a wealth management group for a major U.S. bank. She spent the early part of her career in fixed income. Kelly has earned the Chartered Financial Analyst (CFA) and the Chartered Market Technician (CMT) designations and is a CERTIFIED FINANCIAL PLANNER™ professional.
Broadway Bank Wealth Management’s Portfolio Management team is led by Jeff Nelson, EVP and Chief Investment Officer. Jeff has over 14 years of professional investment management experience, including five years in private practice providing investment management and financial services to clients. He retired from the United States Air Force after 20 years of service at the rank of Lieutenant Colonel. Jeff has earned the Chartered Financial Analyst (CFA ) designation and is a CERTIFIED FINANCIAL PLANNER™ professional.
If you would like to learn more about our Wealth Management Services call us at (210) 283-6700 or visit https://broadway.bank/wealth.
The Bank of San Antonio Hosts Private Aircraft Viewing Event With Merlin1
By Eleanora Morrison | Photography by Vincent Gonzalez
THE SETTING: The Bank of San Antonio recently hosted an event with Merlin1, one of San Antonio’s premier private jet charter companies, to introduce private banking clients to alternative transportation options that exist for both business and personal travel. Now a member of Texas Partners Bank, The Bank of San Antonio offers private banking clients access to VIP event series that connect them to resources to support lifestyle goals.
THE STYLE: Texas Partners Bank CEO Brent Given and Merlin1 Founder Jim Foody both addressed their guests, celebrating the joyous occasion of convening in person for the first time since the pandemic, thanks to vaccines and the socially distanced setting of a partially open-air hangar. Guests viewed Citation III and Learjet 35 jet models and reunited to the sounds of Nina and the Texas Gypsies as they sampled bites and sipped beverages catered by Page Barteau.
THE PURPOSE:After an expansive 2020 merger, The Bank of San Antonio is now a member of Texas Partners Bank, and part of a greater network of Central Texas banks that includes The Bank of Austin and Texas Hill Country Bank. This recent growth has increased the bank’s commercial lending capacity to enable the fastest financing for big plans and has provided the integrated resources for business growth. Eager to help Central Texas businesses continue to grow and thrive, Texas Partners Bank is now a one-stop-shop to customize comprehensive financial and insurance solutions for Central Texas businesses.
Recently, after spearheading a $3M renovation of Austin’s largest theater, Executive & Artistic Director Bob Bursey announced his first curated season of music, dance, theater, and performance for Texas Performing Arts on the UT campus. A dozen live productions will mark its 40th Anniversary season in 2021-2022 and it offers an array of choices…there will be something for just about everyone.
Alvin Ailey American Dance Theater. Photo by Andrew Eccles
The performance lineup includes established and emerging artists, revivals and new works, long-time favorites and first-time visits. The season brings the city a survey of current developments and leading voices in the performing arts in America today. In fact, audiences will see some of the highest examples of artistic excellence.
The Plastic Bag store. Photo by Rundle Mall
The 40th season of performances will take place in Texas Performing Arts’ newly renovated Bass Concert Hall, the intimate McCullough Theater, and at other locations on the University of Texas campus and around Austin. The 40th season is one of Texas Performing Arts’ anchor series for 2021-22. It joins the previously announced Broadway in Austin season, which includes the return of Hamilton, Disney’s The Lion King, and the Austin debuts of Hadestown, Tootsie, Charlie and the Chocolate Factory, Summer: The Donna Summer Musical, and Mean Girls. Broadway in Austin season subscriptions are currently available at BroadwayInAustin.com.
Helen Sung with the UT Jazz Orchestra. Courtesy of Joseph Boggess Photography
In addition to the 40th Season and Broadway in Austin, the Texas Welcomes Series hosts events by national touring attractions, concerts, and comedians. A full list of performances is available at texasperformingarts.org/events.
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Holocaust Museum Houston Hosts Virtual Silver Jubilee Event Celebrating 25 years
By Rob Giardinelli Photography by Priscilla Dickson
Evan and Nicole Katz & Carl Josehart
THE SETTING: Recently, many of Houston’s most notable sociables and philanthropists gathered at the Hilton Americas-Houston for a VIP Watch Party to celebrate a milestone anniversary of one of the city’s most impactful cultural institutions. The celebration was for the Holocaust Museum Houston, which celebrated their 25th year Silver Jubilee and featured touching words from Holocaust survivors and a series of superstar musical performances.
Jerry Simon, John Hantak and Adam Brennen
THE STYLE: The hybrid event allowed for people to attend the VIP watch party in person or celebrate in the comfort of their own home. Those who opted to attend in person donned their finest cocktail attire. The virtual program began with a timeline showcasing how much the organization has grown and impacted the nation’s fourth largest city over the past 25 years.
Next, after words from Dr. Kelly Zuniga, Carl Josehart, and founding chair Martin Fein, was more about the history of the evolution of the museum with emotional stories of those who survived the Holocaust era and an in-memoriam for Holocaust survivors who passed away in the past year. Highlighting the evening, was a special virtual appearance by Tony AwardÒ-winning actor, Ben Platt, who sang three musical numbers, placed at three different points throughout the program, that helped cap a memorable evening.
Kisha and Jason Itkin
THE PURPOSE: The event raised over $1.1 million dollars for the Holocaust Museum Houston. As the fourth largest Holocaust museum in the country, funds raised from the event will go towards online and in-person Holocaust and human rights educational programming for the students, teachers and the public in Houston…and beyond.
Broadway Bank Wealth Management can help your family focus on healing
By Julie Hardaway, SVP, Director of Wealth Services at Broadway Bank
My grandmother was one of 12 siblings. Her family had one heirloom, a clock. The clock was passed around the family without conflict over many years, but sadly, this is not always the norm. Estate planning helps ensure that your exact wishes are fulfilled. It also gives clear direction on personal property to mitigate unnecessary conflict among loved ones.
While personal property may not have much inherent value, it may be priceless due to sentimental value. Most people do not think their family members or beneficiaries will battle over the division of personal property, and so they often fail to properly address the matter. So, what can you do to ease this process and ensure your wishes are fulfilled? Here are seven key questions to get you thinking about this issue.
1. Have you reviewed your estate plan and the provisions that specifically address personal property? Wills and trusts often define what “personal property” is, and that definition may need to be modified for your situation.
2. Does your estate plan contain a statement that you may leave a handwritten memorandum designating certain individuals to receive specified personal property? Have you written such a memorandum? I have administered estates and trusts for many years and have seen very few personal property memorandums. If you know of items that you would like to leave to certain people, you should write a memorandum to the executor of your estate. It should be wholly in your handwriting and signed by you. You could even discuss with your family members what items they would like to have. Such a discussion would give you the opportunity to settle any conflicts should more than one family member want the same item.
3. Does your estate plan address whether your estate will pay the cost of shipping items to beneficiaries? Shipping costs can be an unpleasant surprise, especially for furniture items. Think about where your family members live and any inequality that shipping costs may create, and whether the extra expense of shipping should be deducted from their share of financial assets or paid by them.
4. How will conflicts between family members or beneficiaries be settled? You may decide that your executor or trustee has the final decision-making authority in conflicts or that certain items be can be sold and the proceeds split. No matter what you decide, your estate plan should address these situations.
5. In the event that one family member wants more items than others, do you want personal property valued and distributions to be equalized with cash? Determine if items should be sold in an estate sale, auction or donated to charity.
6. Are you currently married and have children from a prior marriage? You should pay special attention to provisions in your estate plan that relate to personal property. If personal property provisions are left unaddressed, it is very possible that your surviving spouse may end up with your children’s heirlooms. This might cause a rift between your children and your surviving spouse. You should not assume that those items will make their way back to your children at your death or upon the death of your surviving spouse.
7. Have you spoken to your family or potential beneficiaries about your estate plan? If appropriate, you should talk with your family members or beneficiaries about the issue of personal property and your estate plan. The best estate plans are the ones that do not contain surprises. Make decisions now to ensure that the distribution of personal property is as painless as you wish it to be.
Carrying out a loved one’s wishes can be a complex and challenging process for families while they grieve. Planning ahead can help your family focus on healing and celebrating a life. Each estate is unique and some have assets that require special oversight like rural land, mineral rights or personal collections. At Broadway Bank Wealth Management, our team of highly knowledgeable and experienced advisors can act as executor, trustee or agent for your estate. We provide guidance and recommendations to ensure the administration of your estate is efficient and effective.
For 80 years, Broadway Bank has been an integral part of South Central Texas, evolving into one of the largest independently owned banks in Texas with more than $4.6 billion in assets and $2.6 billion in Wealth Management assets. Broadway Bank offers a full range of financial services including personal, private, business, mortgage banking and wealth management. Broadway Bank is committed to enhancing the banking experience through leading edge technology. With financial centers across San Antonio, Austin and the Hill Country, Broadway Bank delivers modern banking, locally sourced and personally delivered.
Julie Hardaway
ABOUT THE AUTHOR: Julie Hardaway is the SVP, Director of Wealth Services for Broadway Bank Wealth Management. She provides guidance to Broadway clients regarding estate planning, and trust and estate administration. In addition, she leads the specialty services groups of Estate Settlement, Real Estate and Oil & Gas. Prior to joining Broadway in 2005, she served as the Staff Attorney for Bexar County Probate Court No. 1. She is a graduate of Southwestern University in Georgetown, Texas, with a Bachelor of Arts degree in International Studies. She earned a Doctor of Jurisprudence from Texas Tech University School of Law in Lubbock, Texas, and was licensed to practice law in Texas in 1996. Julie was elected to the Fellows of the Texas Bar Foundation in 2019. If you would like to learn more about our Wealth Management services, contact Julie Hardaway at jhardaway@broadway.bank or visit https://broadway.bank/wealth.
