80 PROMOTION

2020 Vision: J.P. Morgan Chase continues to invest in business-forward Utah

Amid a  swirl of uncertainty about the sus-tainability of the economic cycle, politics and geopolitics, individuals might be anx-ious about their wealth. Heading into 2020 a certain amount of risk is ever-present, but we are optimistic about the foundation that Utah has in place, which is why we joined our JPMorgan Chase partners and opened the Private Bank in Utah last year. Utah is booming with the second-high-est state GDP growth in the U.S., a  strong startup community and one of the young-est and fastest growing populations in the

Forbes in 2019 named Utah the No. 3 Best State for Business1, the state has re-ceived a ton of accolades in recent years as a business-friendly state. Why did the Private Bank choose to invest in Utah’s business community?

� e Private Bank has been front and center to see the growth across Utah thanks to our long- established partners in our Chase oper-ations, and now we’re proud to be able to call Salt Lake City and Utah our home. After the Private Bank had been working with the Utah community for nearly 20 years, entering this high-growth market for families and busi-nesses with a physical location in early 2019 was a natural next step for us. Utah’s economic growth comes from various sectors and industries resulting in diversifi ed wealth creation across the country.

INVESTING IN SALT LAKE CITY

Managing Director Brian Swenson and Execu-tive Director Eric Smith of J.P. Morgan Private Bank in Salt Lake City co-lead a team of local professionals who provide wealth management advice, strategies and services to successful in-dividuals, family o� ices, foundations and endow-ments throughout the region. J.P. Morgan Private Bank has been serving clients in Utah for nearly 20 years and established their local o� ice in 2019.

J.P. Morgan Private Bank provides custom-ized financial advice and strategies to help wealthy clients and their families plan, invest, borrow and bank with intent. Leveraging glob-al capabilities in investing, philanthropy, family o� ice management, credit, fiduciary servicesand special advisory services, the Private Bank brings clients’ investments and financial assets together into one comprehensive strategy to help them achieve their goals and secure the legacy they envision.

BRIAN SWENSONManaging Director

ERIC SMITHExecutive Director

nation. � e city is experiencing expansion across multiple industries, and as our clients and prospective clients grow their wealth, the sophistication and complexity of their needs grow as well. Complexity like deciding on the most eff ective wealth strategy and how important news and trends may impact your life. Or where to fi nd investment opportunities, how to plan for the future, establishing a legacy that will last beyond your lifetime. We sat down to talk about these challenges, and why Utah is one of the greatest markets to solve them in.

� e Private Bank joins its Chase partners, doubles down on opportunity in the Beehive StateBy Brian Swenson and Eric Smith, J.P. Morgan Private Bank

In particular, the tech sector is booming here in Utah which is why the state has earned the reputation as one of the most entrepreneurial places in the U.S. Establishing a  permanent team here allowed us to participate directly in Utah’s incredible growth story. For busi-ness owners in this exciting space, we’re here to amplify that growth and help them successfully navigate the process of starting, scaling, and ultimately selling a business.

With all the opportunity and optimism surrounding Utah, what are your clients most concerned with heading into 2020?

Heading into the New Year and new decade, a lot of our clients have been asking questions around wealth transfer planning—there are questions as complex as “how do we mini-mize taxes while maintaining control and 1.

For

bes

Ann

ual B

est

Stat

es fo

r Bu

sine

ss—

2019

Ran

king

; ww

w.fo

rbes

.com

/bes

t-st

ates

-for

-bus

ines

s/lis

t 2.

J.P

. Mor

gan

Six

mis

take

s in

vest

ors

shou

ld a

void

in 2

020

, Jac

ob M

anou

kian

, Jan

15,

20

20; h

ttps

://pr

ivat

eban

k.jp

mor

gan.

com

/gl/e

n/in

sigh

ts/i

nves

ting/

six-

mis

take

s-in

vest

ors-

shou

ld-a

void

-in-2

020

CSQ_Q1_20_Special_JPMorgan2.indd 80CSQ_Q1_20_Special_JPMorgan2.indd 80 2/9/20 7:23 PM2/9/20 7:23 PM

81CSQ Q1 2020

who  invest in many early-stage private com-panies can realize significant tax savings on QSBS capital gains up to the greater of (a) $10  million or (b) 10 times your cost basis. Depending on when the stock was acquired, you may be able to exclude from 50% to 100% of the gain from capital gains tax.

In 2019, there were a  ton of headlines whip lashing between tariffs, domestic politics to markets swings. Investors may have difficulties interpreting the chatter. What do you see on the horizon for mar-ket risks?

We don’t see a recession in 2020. An econom-ic cycle typically moves through four phases: from contraction to recovery, expansion and, finally, slowdown. The consumer continues to be a bright spot for the economy. Despite the risks, we believe the economy will con-tinue to grow in 2020, avoiding recession for an 11th year. Volatility can frighten investors, and fear might push them to make emotional, rather than logical, decisions about their portfolios like exiting before they’d planned. It’s impor-tant to consider your goals and investment time horizon. Short-term market volatility and geopolitical chatter won’t impact your long-term investment goals if your portfolio is positioned correctly. If you’re investing for the long-term, the best course is staying the course. As the below chart notes, “Six of the 10 best days occurred within two weeks of the 10 worst days.” Fear may push investors out of the market during

Source: J.P. Morgan Asset Management ana­lysis using data from Morningstar Direct. Re­turns are based on the S&P 500 Total Return Index, an unmanaged, capitalization­weighted index that measures the performance of 500 large capitalization domestic stocks repre­senting all major industries. Past performance is not indicative of future returns. An individ­ual cannot invest directly in an index. Data as of December 31, 2018. Analysis is based on the 2018 J.P. Morgan Guide to Retirement.

bouts of volatility, but by missing some of the market’s best days, investors can lose out on critical opportunities to grow their portfolios.

We saw part one of a  trade deal, but dis-cussions are continuing to drag on. What are the wildcards approaching an elec-tion year?

Binary wildcards like the trade war and up-coming election deserve respect and can be important market catalyst, but trade war and the 2020 election are not enough to derail a well thought-out plan. Don’t be distracted by the election, history tells investors not to overreact to presidential candidates. In 2016, many people thought President Trump’s election would usher in a global re-cession. Previously, many thought the Obama presidency would crush equity markets. Inves-tors who acted on these fears would have missed returns of over 60% (from Trump’s election), over 150% (from Obama’s second term), and over 400% (from Obama’s first inauguration)2. This election year a  few progressive can-didates are vowing to re-make American capitalism. Their campaign rhetoric suggests such potential risks to the markets as higher taxes, a  more stringent regulatory environ-ment and policies that work to elevate labor relative to capital. These risks are real, but we don’t think that the likelihood of the policies being adopt-ed is high enough to derail long-term invest-ment plans. And, while a  snapback from Trump to a Democratic president would like-ly generate volatility, it is unlikely to last. end

Market timing can be a dangerous habit.Sometimes, investors think they can out-smart the market; other times, fear or greed push them to make emotional, rather than logical, decisions. Herd following behaviour during market downturns or bubbles can lead to losses. On the other hand, missing some of the market's best days, investors can lose out on critical opportunities to grow their portfolios, with devastating results. Importantly, as the slide also notes, "Six of the 10 best days occurred within two weeks of  the 10 worst days." This is important because fear may push investors out of the market during bouts of volatility, causing them to miss the rebound on the other side.

It is easy to get distracted from what is important — your goals, and defining how your wealth will get you there in 2020, and beyond. A professional view that cuts through the noise can make all the difference. Visit jpmorgan.com/pb/saltlakecity

flexibility?” and foundational as “does our estate plan still reflect our intent.” Even with clearly defined goals, transitioning significant wealth is rarely simple. It takes a thoughtful plan, well executed to work– making it par-amount to having the right team of advisors managing the process. Often we’re reviewing estate plan doc-uments to make sure they truly reflect your wishes, and that you’re taking advantage of every opportunity to make it easier and less costly to transfer your wealth. A good estate plan is one that clarifies your wishes and balances them against the practical require-ments that need to be met. It also makes the objectives and process clear to your benefi-ciaries and the professionals you’ve selected to help put the plan into action. Additionally, we’ve been working with many of our clients on maximizing the Qual-ified Small Business Stock (QSBS) exclu-sion. Qualified entrepreneurs and others

PERFORMANCE OF THE S&P 500

Performance of a $10,000 investment between January 1, 1997 and December 31, 2017

Stay investedEven missing just a few good days can dramatically under­mine portfolio returns.

"It's always darkest before dawn"Six of the 10 best days occured within two weeks of the 10 worst days.

The best day of 2015—August 26—was only 2 days after the worst day—August 24.

$45,000

$35,000

$25,000

$10,000

$40,000

$30,000

$15,000

$20,000

$5,000

$0 Fully invested

7.20%

3.53%

1.15%

­0.91%

Missed 10 best days

Missed 20 best days

Missed 30 best days

1. F

orbe

s A

nnua

l Bes

t St

ates

for

Busi

ness

—20

19 R

anki

ng; w

ww

.forb

es.c

om/b

est­

stat

es­f

or­b

usin

ess/

list

2. J

.P. M

orga

n Si

x m

ista

kes

inve

stor

s sh

ould

avo

id in

20

20, J

acob

Man

ouki

an, J

an 1

5, 2

020

; htt

ps://

priv

ateb

ank.

jpm

orga

n.co

m/g

l/en/

insi

ghts

/inv

estin

g/si

x­m

ista

kes­

inve

stor

s­sh

ould

­avo

id­in

­20

20

CSQ_Q1_20_Special_JPMorgan2.indd 81CSQ_Q1_20_Special_JPMorgan2.indd 81 2/9/20 7:23 PM2/9/20 7:23 PM