Can You Guess the Resort?

During the dead of winter everyone daydreams about basking in warmer weather, and many folks are fortunate enough to make their dreams a reality. If you’re considering possible destinations, you might come across one that has some eye-popping facts. Read them below and see if you can identify this entertainment mecca:

1. Food: Basic burger/fry/drink combo is about $25/person. Sit down meals start at $35 and shoot up from there. Signature dining at the top restaurants is at least $200/adult. The Michelin-starred restaurant starts at $1,200 for two.
2. Room: $900/night at one of the popular villages with the best room topping out at $3,000/night.
3. Splurge: The resort boasts an “Around the World Private Jet Adventure” to visit and enjoy all of their properties for a starting price of $115,000.
4. If you’d like to skip the crowds and have top priority to visit the resort attractions, you can obtain a priority pass that tops out at $449 per person per day.
5. Oh, and by the way, it costs $119/day just to walk in the door.

Did you figure it out yet? The resort is none other than our beloved Disney World. Some might be surprised, remembering their childhood visit in the 70s when adult admission was $3.75 and a sit-down meal was around $3/person (that’s still only about $25/person in today’s dollars).

In today’s world, many businesses — including Disney – have decided that if you cater to the well-to-do, you can make much more profit even though you sell less units (or have fewer total visitors). Disney’s visitor numbers have decreased while profits have increased. Try taking a family of 4 to a Pistons game at LCA and you will see the same concept at work.

These companies are making a big bet that they can grow their profits while ignoring those with more limited resources. I hope they are wrong because to do big things — especially if you start out with very little — you must be a bit of a dreamer, and there are few places better at inspiring dreams than Disney World.

Fun Fact: I found out watching the weather reports last week that you can use the iconic breakfast restaurant chain Waffle House to track weather. In fact, they have a Storm Center that is so thorough it assists FEMA during hurricanes. The “Waffle House Index” has 3 levels: Green – which means the restaurant is serving a full menu; Yellow – which means a limited menu is being served because power is from a generator and the food supply is low; and Red – which means the restaurant is closed. Since Waffle Houses pride themselves on being open 24/7, Red means weather conditions are extreme in the area

The Sun Don’t Always Shine on the Same Dog’s Tail

On these cold January days, I try to find every excuse to daydream about the golf course. Sure enough, after writing a draft of this Up Early it dawned on me that I found the perfect title. Back in 1954 a guy named Ben Hogan was dominating professional golf. You could say he was the Tiger Woods of the 50s. Another golfer with a syrupy smooth swing by the name of Sam Snead found a way to beat Hogan at the 1954 Masters. After the win, a result that was certainly a surprise, Snead was heard to utter the words set forth in the title above in reminding folks about how good fortune gets spread around.

As we close the books on 2025 investments, the spreading around of good fortune showed up in the financial world as well. You might be surprised to learn the information below about where big returns really came from.

No doubt individual tech stocks seemed to power the stock market higher in 2025. The total return for Nvidia, the glamour child of AI, was 39.46%. Even better was Google (now known as Alphabet) with a 2025 return of about 66%. Heading up the rear was Apple at 13.1% and then Amazon at 6.6%.

It was a good year for U.S. tech stocks, but let me expose you to a few other interesting returns for 2025 that were found in other parts of the world:

1. DFA’s International Value Portfolio I (DFIVX) is a mutual fund made up of “value” stocks from outside the United States. Its 2025 return was 45.21%.
2. DFA’s International Small Company Portfolio I (DFISX) is made up of companies of smaller size outside the United States. Its return for 2025 was 36.33%.
3. DFA’s International Small Company Value Portfolio I (DISVX) invests in small companies outside the United States that are somewhat underpriced. The return on that fund for 2025 was 52.07%.

My intent is to remind you of the importance of diversification. All the news from 2025 seemed to focus on the Magnificent Seven, AI and the outsized returns of those behemoths. Turns out only one of them (Google) could outpace carefully selected international mutual funds. If you are an investment hobbyist or you fancy yourself as a stock picker (good luck with that) then a focus on one country and even one industry is commonplace.

However, for the rest of us who strive to have a fundamentally sound investment portfolio that outpaces inflation, diversification is key. As you can see from 2025, sometimes the areas of investing that do the heavy lifting will surprise you, notwithstanding who makes the biggest noise in the press.

As “Slammin’ Sammy Snead” would surely remind you if he could, “The sun don’t always shine on the same dog’s tail”. Even Ben Hogan would have to agree.

 

Fun fact: For you golf lovers who want to daydream about warmer weather like me, you should know that in April the very prestigious Masters Tournament kicks off the first of the “majors” and the ticket is almost impossible to get. Notwithstanding that fact, the food at The Masters is unbelievably affordable. I’m told a pimento cheese sandwich costs just $1.50 and a club sandwich costs just $3.00.  In fact, according to USA Today, if you bought every item on the menu at last year’s Masters, including the alcohol, your total bill would be $77.00.

How and Why You Can Have Year-End Taxes on Mutual Funds

The new year is here and that means it’s time to start collecting tax forms for your tax preparer. Some forms might show taxable income on one or more of your mutual funds. This comes in the form of a 1099 showing year-end capital gains and taxable dividends. A higher-than-expected tax bill is not uncommon for committed investors. Here’s why:

A “mutual fund” is managed by one or more investment managers and that entails buying and selling various stocks and bonds to carry out the fund’s strategy. Buying and selling decisions can be based on several factors, including risk avoidance or simply rebalancing the fund according to its overall objective. The buying and selling can take place several times throughout the year within the fund itself. An investment that is sold for a gain within the mutual fund creates a profit. By law, mutual funds MUST distribute the net gains to investors by the end of the year.

Investor redemptions can also trigger capital gains. If enough investors, or their financial advisors, need to sell all or a portion of the fund for cash needs, the mutual fund managers often must sell some investments within the fund to raise the cash needed to pay out to the investors. Any gains resulting from the sale must be distributed out to investors by year’s end.

As a result of the factors above, sometime in December most mutual funds issue year-end capital gains distributions to investors, which have to be listed on the investor’s tax return if the fund was held in an after-tax brokerage account. Mutual funds held in tax-deferred retirement plans like IRAs and 401ks do not carry out taxes each year to the investors. Instead, the investor pays taxes on tax-deferred accounts only when they make a withdrawal from the IRA or 401k.

In some ways, the whole mutual fund tax issue falls under the “good problem to have” category because taxes mean the fund likely did well for the year (but not always). With the gains of 2025, be prepared for the fact that you will likely see a 1099 on your after-tax brokerage account that lists taxable gain and dividends, even if you held on to the fund for the whole year. Now you know why.

Fun Fact: The first real mutual fund was the Massachusetts Investor Trust (MITTX) which was started on March 21, 1924. A $1,000 investment in the fund in 1924 would be worth $7,067,000 today.