At Hill Investment Group, we spend our days immersed in markets and evidence. We know most people don’t, and our clients rely on us to do that work for them.

Even the most financially literate investors can encounter misconceptions, often picked up from friends, social media, or the financial press. Many of these are rooted more in behavior and emotion than in evidence.

Here are a few we hear regularly, along with an evidence-based perspective on each.

It can be easy to think of dividends as “free money” from an investment, and some even choose funds solely for their dividend yield. The reality is that when a company pays a dividend, the value of its shares is reduced by the same amount. For example, if you hold a $20 share and it pays a $2 dividend, you now have $2 in cash and a share worth $18—the total value is unchanged.

Companies that reinvest profits into their business sometimes create more long-term growth than those that pay them out. At Hill, we view dividends as one element of total return and often as a way to rebalance portfolios in a tax-efficient manner.

For clients who rely on investments for retirement income, we may help design a withdrawal plan by selling shares. This approach allows:

• Investment decisions to be based on total return, not dividend yield alone.
• Greater flexibility to manage tax impact by choosing which holdings to sell.

This can be more tax-efficient than receiving dividends automatically, which are taxable whether you need the income or not.

No one enjoys seeing an investment go down. But in certain cases, realizing a loss can provide a tax benefit while keeping your long-term plan intact.

For example, tax-loss harvesting involves selling an investment that has declined, capturing the loss to reduce taxes today (or in future years), and reinvesting in a similar security to maintain your portfolio’s strategy.

This doesn’t remove the reality of market downturns, but it can turn them into opportunities for tax management. While individual investors may not do this on their own, professional advisors often monitor for these opportunities as part of portfolio management.

Because U.S. companies are most familiar, many investors lean heavily toward them—sometimes without realizing it. Yet the U.S. represents only about half of the global market, which means there is significant opportunity beyond our borders.

Diversifying globally can help manage risk and position a portfolio to benefit from growth wherever it occurs. History has shown that different markets lead at different times. For example, U.S. stocks lagged from 2000 to 2010 while international markets performed better. In other periods, U.S. stocks have led. Since no one can predict which region will outperform next, broad diversification helps reduce reliance on a single market.

Investing comes with complexity, and misconceptions are common. Our role is to help clients cut through the noise and make evidence-based decisions that support a long-term plan.

If you know someone who might be interested in learning more about this approach, we’re glad to share educational resources or have an introductory conversation. They can reach us at askanadvisor@hillinvestmentgroup.com.

Welcome to the age of the “finfluencer.” While some have genuine experience, many are focused on views, and not your best interest. At Hill Investment Group, we believe that real advice should be simple, clear, and grounded in evidence, not hype. That’s why we’re launching a new series to unpack misleading ideas that circulate online or in print.

Our goal? To inform, not entertain. To offer substance, not speculation.

Heard something at work, at golf, or on social media that has you asking, “Should I be paying attention to this?” Feel free to share it with us. We’d love to help unpack it. Submissions will remain confidential unless we get your permission to share anonymously. Send to: zenz@hillinvestmentgroup.com

Please note: Submissions are reviewed for educational purposes only and do not constitute personalized investment advice.

If you follow finance influencers online, you’ve probably seen a version of this pitch: “All you need are these ETFs.” More often than not, that list includes VOO and QQQ, and little else.

It’s a compelling idea. Over the past decade, these two funds have benefited from strong performance by large U.S. companies, particularly the tech sector. But a closer look at what’s under the hood reveals a more concentrated and potentially less diversified portfolio than many investors realize.

What These Funds Represent

VOO is an index fund tracking the S&P 500, which includes large U.S. companies. QQQ tracks the NASDAQ-100 Index, which also focuses on U.S. large-cap companies, particularly technology-oriented names. While they are separate funds, they share many holdings.

In fact:

• Roughly 85% of QQQ’s holdings also appear in VOO.
• The overlap in weight between the two strategies is around 50%.

That means holding both may result in doubling up on the same exposures, mainly large U.S. tech and growth-oriented companies.

Additionally, QQQ’s higher expense ratio reflects the licensing cost of tracking a proprietary index, as well as required marketing efforts. While high fees alone don’t negate a fund’s  merits, investors should always ask themselves if they can get similar investment exposures without the additional costs dragging down performance. 

What’s Not Included

Holding only VOO and QQQ may leave meaningful portions of the global capital markets untapped. These include:

• Small- and mid-cap U.S. companies
• International developed markets
• Emerging markets

Together, VOO and QQQ cover a significant portion of the U.S. market but only represent about half of the global investable opportunity set. Omitting the other half may reduce diversification and limit exposure to other potential sources of return.

For instance, in some years, areas outside the U.S., such as international stocks, have delivered notably stronger returns than their domestic counterparts. That rotation is unpredictable and has lasted over a decade when looking at historical returns.

A Broader Perspective on Diversification

Low-cost index funds can be valuable building blocks, but true diversification often means looking beyond the most visible names. A globally diversified portfolio typically includes exposure to companies of varying sizes, styles, and geographies. This broader approach is designed to manage risk and capture returns from multiple parts of the market, not just the ones making headlines.

The Takeaway

There’s nothing inherently wrong with VOO or QQQ. They offer relatively efficient access to major segments of the market. But using them as your only strategy may leave diversification and opportunity on the table. We know you can do better. An evidence-based investment approach typically considers a wider range of asset classes, grounded in long-term academic research rather than short-term trends.

Welcome to the age of the “finfluencer.” While some have genuine experience, many are focused on views, and not your best interest. At Hill Investment Group, we believe that real advice should be simple, clear, and grounded in evidence, not hype. That’s why we’re launching a new series to unpack misleading ideas that circulate online or in print.

Our goal? To inform, not entertain. To offer substance, not speculation.

Heard something at work, at golf, or on social media that has you asking, “Should I be paying attention to this?” Feel free to share it with us. We’d love to help unpack it. Submissions will remain confidential unless we get your permission to share anonymously. Send to: zenz@hillinvestmentgroup.com

Please note: Submissions are reviewed for educational purposes only and do not constitute personalized investment advice.

A prominent advisor at a national wealth management firm recently posted a popular headline online:

     “What could possibly have performed better than buying the Lakers for $67.5 million in 1979 and selling them for $10 billion today?

     Answer: The stock market.”

The post argued that simply investing in the S&P 500 would have outperformed the sale of the Lakers by an estimated $3.7 billion.

It’s catchy. And it seems to reinforce a message we strongly believe in: that long-term, diversified investing often outperforms more exciting-sounding alternatives.

But there’s a problem: the comparison isn’t accurate.

The claim uses the total return of the S&P 500 (which includes both price appreciation and reinvested dividends) but compares it to only the price appreciation of the Lakers. That’s not an apples-to-apples comparison.

To make a fair comparison, we’d need to include decades of Lakers’ profits, as well as proceeds from the sale of other assets tied to the original deal, like the L.A. Kings, The Forum, and other valuable land holdings. A more appropriate benchmark for the S&P 500 would be its price return alone, which would have resulted in a significantly smaller figure than the Lakers’ current estimated value.

It’s like evaluating a stock without considering the dividends. As evidence-based investors, we know how important it is to look at the full picture.

Why Total Return Matters

At Hill, we focus on total return—not just income or price growth—because it reflects the complete investment outcome. Ignoring part of the return can lead to faulty comparisons and poor financial decisions.

So let’s not lose sight of the broader point: Owning a low-cost, globally diversified portfolio has been one of the most accessible and consistent wealth-building tools for long-term investors. Unlike a professional sports team, which typically requires billions in capital, an evidence-based portfolio is available to nearly anyone with savings and discipline.

Yes, buying the Lakers was a great investment for Jerry Buss.

But for the rest of us? Trusting markets, managing costs, and sticking to a thoughtful plan…that’s a powerful approach, too.

This example is for illustrative purposes only and does not reflect the performance of any specific investment or portfolio. Index performance is not indicative of any particular investment. It is not possible to invest directly in an index. Past performance does not guarantee future results.