Global Shipping Under Siege: How Hormuz, the Black Sea, and Red Sea Threats Hit Your Investments

**SPEAKER_1** (0:01)
This is InvestTalk from KPP Financial, helping investors make sense of the markets one day at a time. Here's your host, Justin Klein.

**Justin Klein** (0:16)
Good afternoon, fellow investors, and welcome back to InvestTalk. This is our Monday, August 17th, 2026 edition of InvestTalk. A lot to unpack during this hour. We have some great topics to cover, but most importantly will be your topics. Whatever's on your mind, we want to hear from you. That's what the show is about. It's not about me. I can sit here, I can talk for a long time. I do this every day. I've done it for, geez, almost 20 years now. I've been investing for over 25 years. This is old hat to me. But what I love is hearing new questions, new faces, or new voices, shall we say. We got a great one, I think it was last week, last Monday. We had a boy, I think he was, was he nine? I think he was nine. I called in. That was great. So anybody of all ages, come on in, ask your question. Whatever is in your mind, we are here to help. Help you become a better investor, avoid the pitfalls, and capitalize on the opportunities. Because no matter what the headlines say, no matter how you feel about the world, the market does not care what you feel.
And there will always be opportunities waiting for you with the right focus, energy, and discipline.
Hopefully, we're a part of that process, keeping you engaged, keeping you focused, keeping you disciplined, so that you're not making bad decisions.
It's in our nature to make bad decisions financially. Because we're emotional beings. But investing good, proper money management is about having a levelhead.
So we are here for that. Now in just a bit, we'll talk about today's Mark performance and rundown show topics. But first, let's tackle this call question now.

**Alfonso** (2:22)
Hi, Luke or Justin. This is Alfonso from the Bay Area. Can you review the mechanics of position sizing using a concrete example? Say I have about a million dollar portfolio and I'm bullish on the stock, say, and it could go mine. Thank you.

**Justin Klein** (2:40)
Position sizing is just making sure that no one position is larger than a certain percentage of your portfolio. And then if things go well, it's trimming it back to your original target. So we like to limit our exposure to around 5% of any one name in a portfolio. If it does really well, that might start to float up 6%, 7%. But then we start pushing 7%, especially we're going to get that back down. We want to trim it back down to 5% or so, whatever our original target is. And sometimes if the market shifts, you lower that target, you get it back down to 2%, 3%, maybe even the main position if something major changes. That is the essence of position sizing and making sure that your target allocation is aligned with the overall trends in the market. Because it's easy to set an allocation, it's more challenging to update it regularly and monitor it.
Today's allocation and a year from now's allocation should probably be different because the market dynamics are going to shift, and you have to be willing and able to make those adjustments. That's if you are being a bit more targeted with your allocations, as opposed to just being an index investor. That's what we do as professionals. We are constantly monitoring the macro environment and then adjusting our target allocations, and it probably won't change dramatically in one year, but at the margins, most likely will. So hopefully that helped give you some insight on position sizing. Now, we had a great show on Friday, and we looked into the story, Soft Jobs Report and the Dollar's New Direction. What it means for investors. We also answered a question on ticker symbol RAIL, some freight cars of America. If you happen to miss it, go check it out. The best way to get every show is to follow InvestTalk wherever you get your podcast. Now, we have a lot of ground to cover over the next 45 minutes or so, and time permitting, we'll get to all of it. Our main focus point is about the global shipping lanes being under siege, how Hormuz, the Black Sea, the Red Sea threaten to hit your investments, the economy as a whole, what sectors are going to be hurt or currently being hurt, and then what sectors are actually benefiting because that can happen as well. So we're going to look at all of that and much, much more. Then we have other topics. One is private investments as a whole. Now, there's private equity, private credit, there are private wreaths, there are a lot of different type of private non-traded assets that are often sold by a lot of the big wirehouses, I would say, the Morgan Stanley, Merrill Lynch's of the world, etc. They're usually being sold because you're dealing with a broker, you're not dealing with an RIA, most likely, because they're getting a big commission. But I really want to dig into, how do you vet that if you do have an advisor that's pitching? Because not all private funds are bad, but it's just a very high hurdle to go over. So what questions do you ask to feel comfortable with making that decision? So we'll go look at that. And then rates are up. Interest rates are higher. Is that a lot of people say that's because of the debt situation. We're at $40 trillion in debt. We have about an 8% debt to GDP ratio in a non-recessionary environment, which is massive.