INSIGHTS

July 20, 2026

Manager Perspective

Affinity Investing is a Real Risk

One of the most important rules in investing is never to confuse admiration for a person with the merits of an investment.

One recent market example makes the point clearly. Suppose an investor allocated $10,000 when President Trump took office.

C. Angus Schaal, CFP^®

Senior Managing Director

Using January 20, 2025 as the starting date and July 14, 2026 as the ending date, here are the returns:

Gold: ~$15,200-$15,300, +52%
Bitcoin: ~$5,900-$6,000, -40%
Trump meme coin: ~$400-$500, -95% to -96%
S&P 500: ~$12,500, +25%

The lesson is not that gold always wins, cryptocurrency should be avoided, or the S&P 500 is risk-free. Markets move in cycles, and no single asset leads forever.

The more important lesson is that politics, personality, and identity can become dangerous shortcuts in financial decision-making.

Affinity investing is a real risk.

Financial professionals have long warned about affinity investing: the tendency to invest based on trust, politics, religion, shared identity, admiration, or loyalty rather than objective analysis.

Instead of asking:

Does this investment produce earnings or cash flow?
Is the valuation reasonable?
What are the risks?
Does it fit my financial plan?

Investors sometimes ask:

Do I believe in this person?
Does this represent my values?
Am I supporting a cause?

Those are understandable instincts, but they are not sound investment criteria.

A portfolio should be built around goals, time horizon, taxes, liquidity needs, diversification, and risk tolerance. It should not depend on a political figure, celebrity, influencer, or charismatic entrepreneur.

At the same time, investors are navigating a difficult backdrop. Inflation remains a concern, federal debt has continued to rise, and market narratives are moving quickly. That makes discipline even more important.

Politics will always generate strong opinions. Investing requires objectivity.

Before investing, ask:

What is this investment actually worth?
What risks am I taking?
How does it improve my overall financial plan?

Long-term wealth is built through discipline, diversification, and evidence-based decision-making, not loyalty to a personality or a cause.

Disclosures:

Tandem Wealth Advisors LLC (“Tandem”) is an SEC-registered investment adviser.

The information published herein is provided for informational purposes only and does not constitute an offer of investment advisory services. All information is subject to change without notice. Nothing contained herein constitutes financial, legal, tax, or other advice. No investment process is free of risk, and investors may lose all their investments. Past performance is not indicative of current or future performance and is not a guarantee. The opinions expressed in this document may not fit your risk and return preferences. The information provided is obtained from sources believed to be reliable, but we cannot attest to its accuracy. Past performance is not necessarily indicative of future returns.

Certain information contained herein constitutes “forward-looking statements,” which can be identified by the use of forward-looking terminology such as “may,” “will,” “should,” “expect,” “anticipate,” “project,” “estimate,” “intend,” “continue,” or “believe,” or the negatives thereof or other variations or comparable terminology. Due to various risks and uncertainties, actual events, results, or actual performance may differ materially from those reflected or contemplated in such forward-looking statements. Nothing contained herein may be relied upon as a guarantee, promise, assurance, or a representation of future events or conditions.

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