Resources/Weekly Insights

Volume 14, Edition 25 | August 11 - August 17, 2025

The Customization Trap: Why “Unique” Isn’t Always Better

Doug Walters, CFA

It’s tempting to think the best portfolio is the one that looks most unique. But in investing, endless customization often means drifting away from the strategies most likely to succeed. The key is balancing your personal needs—risk tolerance, income, liquidity, and tax considerations—with an evidence-based core designed to deliver long-term results. Personalization should serve the plan, not the marketing.

Contributed by Doug Walters, David Lemire, Max Berkovich, Matthew Johnson

“A unique portfolio, built just for you.” It’s a promise that sounds great in a marketing brochure-and one we’ve probably made ourselves at times. But, at least for us, it may not mean what you think it does.

I got to thinking about this will listening to our latest podcast exploring the unique financial planning considerations for the LGBTQ+ community. Every client brings a distinct set of circumstances, goals, and constraints. A good advisor will craft a plan based on a deep understanding of those nuances.

But when it comes to investing, customization carries a hiding tension.

When Personalization Goes Too Far

We believe in evidence-based investing. Our team has built a lineup of risk-based strategies—ranging from Conservative to Aggressive—using decades of academic research and real-world experience. These are our best ideas.

By definition, every deviation from those strategies takes a step away from what we believe works best. While we can customize portfolios in countless ways, we generally wouldn’t recommend doing so unless there’s a compelling reason.

Where Personalization Really Pays Off

Meaningful customization isn’t about sprinkling in favorite stocks or trendy themes. It’s about aligning your portfolio with the realities of your life:

Risk tolerance: How much market volatility can you ride out without abandoning the plan?
Income needs: Do you require steady cash flow, or can you reinvest for growth?
Liquidity requirements: Are there near-term expenses that call for accessible, stable funds?
Tax considerations: Do you hold legacy positions with large, embedded gains that require a careful transition plan?

These are the areas where tailoring a strategy can materially improve outcomes.

The Evidence-Based Core

Our philosophy is simple: start with the best ideas supported by decades of research—broad diversification, proven factors at the core, cost control, and disciplined rebalancing—and only adjust where it truly adds value. This approach ensures that personalization serves the plan, not a marketing slogan.

The Right Kind of “Yours”

The art of investing lies in balancing individual circumstances with time-tested principles. Stray too far from the evidence, and you risk turning a sound strategy into a guessing game.

The goal isn’t to make your portfolio “different”—it’s to make it right for you, without sacrificing what works.

2.7%

Consumer Price Index Inflation

CPI Inflation held steady at 2.7%, but ex-food and energy (which some prefer to look at) rose from 3.0% to 3.1%.

Headline of the Week

Inflation’s Mixed Messages

This week delivered a tale of two inflations. Tuesday’s Consumer Price Index (CPI) offered a reassuring signal, rising just 0.2% in July and reinforcing the narrative that price pressures are easing. Markets breathed a sigh of relief, briefly pricing in a September rate cut. That sigh barely escaped before Thursday’s Producer Price Index (PPI) jolted the narrative with a 0.9% monthly surge—the largest in over three years. Together, these reports could put upward pressure on the Fed’s preferred inflation gauge, the Personal Consumption Expenditures (PCE) index.

The divergence underscores the complexity of today’s inflation dynamics: consumer prices appear tame, yet upstream costs are accelerating, partly reflecting the ripple effects of recent tariffs. So far, businesses seem to be absorbing those higher costs rather than passing them on to consumers. How long that continues remains an open question—and it heightens attention on upcoming consumer price reports.

For the Federal Reserve, this split view complicates an already delicate balancing act. A September rate cut once seemed all but certain; now, the path forward looks anything but straightforward.

The Week Ahead

Lots of intrigue around interest rate policy this week, with minutes of the last Federal Reserve meeting and a Jackson Hole retreat during the week. Retailers dominate the earnings calendar with Wal-Mart leading the charge.

Hole-y Moley

With markets pricing in a rate cut at the next meeting and with talks of a mega-cut now making rounds, attention will be directed at the annual late summer symposium in Jackson Hole, Wyoming.

The key to the entire central bank schmoozefest will be the communique from federal reserve chairman.
Powell’s words could disrupt the bullish run in markets if he sounds unmoved by recent data or continue the euphoria if the chairman shares an upbeat tone.
With President Trump taking pot-shots at the Chairman any chance he gets, the pressure is on.

Mega Mart

Late innings of earnings season shift focus to the consumer with Target, TJX Companies, Ross Stores, Lowes, Home Depot, Estee Lauder, Baidu, Alibaba, BJ’s Wholesalers and the biggest one Walmart all releasing results this week.

The retail sales report on Friday indicated continued resilience from consumers, defying the softening jobs market and waning consumer confidence surveys we have digested.
Commentary from the retailers could help unwrap the murky picture painted by data.
Home Depot and Lowes are expected to report the strongest same store-sales growth in nearly 3 years, due to favorable weather and seasonal trends.
Wal-Mart may concern investors if it refrains from providing guidance for another quarter, citing tariff-related uncertainties.
Analyst consensus has Walmart’s second quarter sales coming in at $176 billion.

About Strategic

Founded in 1979, Strategic is a leading investment and wealth management firm managing and advising on total client assets of over $2.5 billion.

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