from https://www.businessinsider.com/how-ultra-wealthy-prepare-for-recession-preparation-portfolio-2019-9

(Sounds like trying to time the market to me!)

5 things the ultra-wealthy are doing to prepare their portfolios for a
possible recession, from ditching bonds to stockpiling cash
Taylor Nicole Rogers 19h

upset nyse trader
A recession may be imminent, and the ultra-wealthy are taking notice. REUTERS/Brendan McDermid

Some economic indicators are warning that a recession may be imminent.
Though many financial planners advise not altering your portfolio in
reaction to the market, some high-net-worth people are shifting their
fortunes from bonds and into cash to reduce their risk.
Business Insider spoke with five certified financial planners around the
US to find out how the ultra-wealthy are preparing for the possibility
of a recession.
Financial planners for the ultra-wealthy are advising their clients to
reduce their debt in preparation for a market slowdown.
Visit Business Insider's homepage for more stories.
A recession may be imminent, and the ultra-wealthy are taking notice.

Many are rearranging their portfolios in an effort to protect their
fortunes, a group of certified financial planners told Business Insider.

Their strategies vary from person to person based on their risk
tolerance, Ashley Folkes, a certified financial planner and senior vice president of Moors & Cabot, an Arizona wealth-management firm, told
Business Insider.

Folkes said that "over the years working with high-net-worth clients,"
he had seen "a tendency to protect and then grow their wealth."

"We discuss how much undue risk you are wanting and willing to take in
order to satisfy your goals," Folkes said. "Currently, I'm seeing the conversations with investors shifting to a slightly more defensive stance."

Read more: Billionaires tend to make riskier investment choices than millionaires, and it helps explain why ultra-high-net-worth individuals
lost so much of their money in 2018

Older ultra-wealthy Americans are the most anxious to modify their
portfolios in anticipation of a market correction, Ben Smith, a
certified financial planner with Cove Planning in Wisconsin, told
Business Insider.

"We have explored moving into high-quality fixed income and even
alternatives in order to provide ballast in a volatile equity market,"
Smith said.

Here are five things the ultra-wealthy are doing to prepare for a
recession, according to their financial planners.

1. Wealthy investors are ditching bonds
Short-term bonds have offered investors higher returns than their
long-term counterparts since the yield curve inverted in August,
Business Insider previously reported.

But an inverted bond yield curve isn't just an important indicator of a shrinking economy, according to Steven Kaye, a certified financial
planner and the CEO of AEPG Wealth Strategies in Warren, New Jersey.

"Bonds offer little value currently, except for portfolio ballast," Kaye
told Business Insider.

Reducing clients' exposure to bonds also reduces their exposure to
fluctuations in interest rates and the overall market, Kaye said — two
things that would be abundant in a recession.

Read more: The yield curve is inverted. Here's what that means, and what
the implications are for the economy.

2. Instead, they're stockpiling cash to maintain their liquidity
Moving one's fortune to cash is a popular way to ensure it outlasts a recession, according to Samuel Boyd, a certified financial planner and
the senior vice president of Capital Asset Management in Washington, DC.

"The key to surviving, and thriving, in any recession is access to
liquidity," Boyd said. "As the old saying goes, 'cash is king,' and it
can mitigate portfolio risk as well provide a fulcrum to capture
opportunities when the world is on sale."

The billionaire hedge-fund manager Sam Zell of Equity Group Investments
is also shifting the assets under his management into cash, he told CNBC earlier this month.

"We certainly never had a cash position like we have now," Zell said. "I
think we're very reticent about the opportunity. We think there's going
to be some significant opportunities, but what we don't see is the urgency."

3. The 1% are embracing ETFs to shield their wealth from unnecessary risk
For high-net-worth people, exchange-traded funds provide a lower-risk
way to stay in the market amid increased volatility among equities.

"If you want to stay invested in equities until there is a stronger feel
for a recession, then you could shift to index ETFs, to index low
volatility ETFs," Folkes told Business Insider.

Folkes also recommended that those looking to mitigate their risk invest
in dividend-paying stocks with long histories.

"Shift more to high-quality dividend-paying companies that have shown historically they can handle prolonged periods of weakness in the market
by having low debt and solid balance sheets," Folkes said.

4. They are paying down any debts
Even high-net-worth people who haven't reallocated their portfolios in anticipation of a market correction are looking to refinance and pay off
their debts while interest rates remain relatively low, Jared Friedman,
a certified financial planner with Redwood Planning in New Jersey, told Business Insider.

"Clients are asking about it and discussing it more but have not made
any allocation changes at this time," Friedman said. "We are trying to proactively pay down any extra debt and save more money."

5. The best thing the ultra-wealthy can do is stop trying to game the market Ultimately, though, the best thing nervous high-net-worth investors can
do for their portfolios may be nothing at all, Smith told Business Insider.

"I have received a few questions from these clients about their current allocation and how different market scenarios will impact potential
returns," Smith said. "I reiterate that their risk tolerance, asset
allocation, and ultimately their portfolio mix reflects a potential
recession in the markets, and the most important thing they can do in
order to maximize the probability of reaching long-term goals is to
stick with their plan and don't give in to emotions."

SEE ALSO: What the world's richest people look for when they choose
their wealth managers
DON'T MISS: Why Elizabeth Warren and billionaires like George Soros
alike are calling for a specialized tax on the ultra-wealthy
More: BI Select Arts & Culture Billionaires Personal Finance

--- SoupGate-Win32 v1.05
* Origin: fsxNet Usenet Gateway (21:1/5)