Playing 'What If' With Your Investments

Yet, with the exceptions of highly engaged, wealthy individuals and well-funded day traders, Hidden Levers isn't a product that individual investors can afford. Prices start at $300 a month and go up to $1,200, depending on the particular version of the service.

However, the product's underlying rationale is instructive for individual investors because of what it demonstrates about how economic developments and current events can affect specific investments. These lessons include:

• You should assess potential outcomes specifically and incrementally. Fear keeps investors from doing this. These emotions can prompt rash behavior. For example, if you were particularly scarred by 9/11, you might be especially fearful that another catastrophic terrorist attack on the U.S. will occur, sending the stock market falling. Though, if this fear intensified, it might prompt you to sell the ranch, a more particularized projection of impacts might mean you'd be more restrained, selling some of your holdings in certain investments and perhaps putting the money into investments that aren't affected.

• Those impelled by greed – and looking to capitalize on what they see as the likelihood of certain events occurring -- shouldn't bet the ranch. Just as portfolio managers can move levers to see a range of impacts, you can do your own analysis of potential impacts, one investment at a time, to identify potential opportunities. This analysis may reveal that, if such events occur or certain economic trends set in, some investments might not be as lucrative as greed alone might suggest.

• Keep your projections specific. While major events can move major indexes, such as the S&P 500 or the Dow Jones Industrial average, unless you own funds pegged directly to these indexes, a drop in one of them doesn't necessary mean a big hit to the stocks you actually own. If Hidden Levers tells us anything, it's that different industries and companies can register vastly different impacts from the same events.

This work is the opinion of the columnist and in no way reflects the opinion of ABC News.

Ted Schwartz, a certified financial planner, is president and chief investment officer of Capstone Investment Financial Group. He advises individual investors and endowments, and serves as the adviser to CIFG UMA accounts. Because Schwartz has a background in psychology and counseling, he brings insights into personal motivation when advising clients on how to achieve their wealth management goals. Schwartz holds a B.A. from Duke University and an M.A. from Oregon State University. He can be reached at

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