Before my career in finance, I spent most of my life as a musician. I started piano at 6 or 7 years old, working my way through beginner books before moving on to a more serious classical repertoire. In my early teen years, I took interest in Jazz and Pop music. In high school, I started to actually get paid to play piano with some friends at restaurants and weddings. Getting paid to play piano seemed too good to be true so I kept pursuing music in college. At that point, I dedicated my studies to jazz music – the art of improvising and composing music made completely in the spur of the moment.

I did freelance work for several years before moving into music ministry at churches. I became a “chameleon” in musical terms – I was comfortable in any setting. Need some improvised jazz music? I’ve got you covered. Need me to play Mendelssohn’s Wedding March on the organ? I’ve got you covered there, too. Looking for light classical background music? I can do that as well. 

I was comfortable performing in any musical setting because I put in a lot of hard work over decades. I devoted all of my time and energy to learning about different styles of music, listening to recordings, and practicing 6-8 hours a day during college.

After some success as a musician, I wanted a career with more stability, so I went back to school to earn my MBA. I always enjoyed the business side of working as a musician and wanted to be equipped to move into the (non-music) business world. While pursuing my MBA, I found that I most enjoyed financial analysis and accounting, which eventually led me to Franklin Wealth. I am confident that the skills I developed as a musician have helped me here at FWM.

My wife, who is a Professor of Piano at UTC, has been preparing for a recital that she has coming up in a few months and it’s had me thinking about the similarities between preparing for a recital and investing.

Behind the Scenes

Many of us have had the experience of attending a concert and enjoying the performance on stage. This is the finished product of long hours of work before the artist is ready for “showtime.” I know many of you have been to countless piano or band recitals by children and grandchildren. And many of you know through first- and second-hand experience that an immense amount of work goes into preparing for a musical performance.

Pianists like my wife and I spend years practicing scales and arpeggios, analyzing harmony, reading about composers, and listening to dozens of recordings just to build the foundation for a successful performance! When working on a specific piece of music, we spend months “drilling” difficult passages, memorizing each measure, and performing the piece for teachers, mentors, family, and friends before actually performing the piece for a public audience. My wife often practices entire pieces playing only one hand at a time, jumping to random spots in the piece to test her memory, or playing the piece at half speed or double speed to test her technique.

This is just some of the work for what could end up being a 5-minute performance! A musician must do the “dirty work” behind the scenes for the performance to be successful.


Investing is similar in that we draw upon years of experience, hard work, and data – we do the dirty work behind the scenes – to select the right company that might be successful. Before we invest in a company, we dig through balance sheets, cash flow statements, and quarterly and yearly reports. We analyze the data using different ratios and read other analysts’ reports. We read the manager’s comments in annual reports, get to know the company’s competitors, read about the executive team’s successes and failures, and bounce our ideas off colleagues at FWM. We do all this research or “dirty work” like the pianist by perfecting our technique through practice and our ability to perform well.

Choosing the Best Match

After all this practice, sometimes the musician finds that a piece they are working on is just not the right “fit” for performance. This could be for many reasons – it’s too flashy or not flashy enough, too short or too long, in a style that we aren’t comfortable with, or doesn’t fit well with the other pieces we are playing in a performance. Sometimes we discover this early on and save some hours of practice, but sometimes we don’t come to this conclusion until the concert is near and we must change direction quickly.

We run into this as investors, too. The companies may not be in an industry we’re comfortable with, or maybe we already own another similar company so it’s not a good match for the portfolio. The beauty of both researching stocks and practicing music is that we don’t have to buy (or perform) any of them. We can let many investment opportunities pass us by without “biting,” and having the discipline to let investments pass you by is often the marker of a good long-term investor.

If we do research and analysis of 100 companies, we might find 2 or 3 that we really like and end up investing with them. As investing legend Charlie Munger once put it, “It takes character to sit with all that cash and to do nothing. I didn’t get to where I am by going after mediocre opportunities.”


Finding great companies vs. momentum investing

In the past few years, investors have been following trends blindly. Retail trading has skyrocketed, investors are taking on more and more risk and the common narrative is that the market will always go up. Many investors consider social media trends as beneficial. Unfortunately, they invest all of their money on these trends without knowing anything about the company! However, while these high-priced sexy investments sometimes perform well in the immediate term, they almost always lose money in the medium- to long-term.

Fortunately, at FWM our investment philosophy is not centered around blindly following trends.  However, we don’t balk at trend-following completely. Since the market moves in cycles and due to the careful research, we may follow sectors that tend to perform well given the current cycle. Even as we follow these trends, we are always looking for value. We like to find great companies, wait for them to go on sale, and invest in them when the greater market trend is in their favor.

Our Team is Working for You

Just like in music performance, we can’t guarantee that every selection will “knock your socks off”. What we can guarantee is that we are committed to the behind-the-scenes work. Like the master musician who patiently practices for hours before a performance, we are committed to putting in the work to give our clients the best possible shot at success. We patiently listen to the music of the markets so that you can be confident we are always looking out for the best interest of our clients. 

As a Wealth Plan Analyst, Patrick is dedicated to the analysis of client portfolios and their underlying securities as well as research and analysis of the broader market and economic trends to best serve our clients’ needs. Patrick also provides support in preparing financial plans, meeting with clients, and assisting with various back-office and technology support.

 

 

 

 

Joe D. Franklin, CFP is Founder and President of Franklin Wealth Management, and CEO of Innovative Advisory Partners, a registered investment advisory firm in Hixson, Tennessee. A 20+year industry veteran, he contributes guest articles for Money Magazine and authors the Franklin Backstage Pass blog.  Joe has also been featured in the Wall Street Journal, Kiplinger’s Magazine, USA Today and other publications.

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