How to Protect Yourself Against Cyberterrorism

How to Protect Yourself Against Cyberterrorism

A client called the other day asking if I thought the North Korean attack on Sony Pictures' The Interview was a game changer.

I spend a lot of time talking about innovation and exponential technologies. Cyberterrorism is one of the negative outgrowths.

You can be sure our government takes the threat seriously. So does the financial sector.

Every firm spends huge amounts of money building systems to protect its clients. My firm certainly does!

But it’s important to understand that it is impossible to be 100% protected from harm. A leading security expert once told me, “Every time we build a 10-foot wall, somebody shows up with a 12-foot ladder.” 

People who are fearful of investing in the stock market sometimes think putting all their money into banks solves their worries. It doesn’t. Not only are banks just as susceptible to cyberterrorism as every other financial firm, there are limits to what FDIC can do to protect you.

Think back to 2001, when the government closed banks for three days in the aftermath of the 9/11 attacks. If you needed money during those few days, you had a problem.

That’s why we encourage diversification. Since there is no safe place to hide, the best approach is to do a little bit of everything. We should have some cash in our homes in a safe, some cash in banks, and the rest in investments, spread among a wide variety of asset classes and market sectors so we won’t lose too much of our money if any one of them falls in value.

That’s why we usually provide our clients with portfolios featuring 18 or 19 asset classes and market sectors from around the globe. Our clients’ portfolios feature about 6,000 stocks and 1,700 bonds – but packaged in a simple, easy-to-manage portfolio that makes record-keeping a breeze (and we handle that chore for our clients, too).

Cyberterrorism isn’t going away, so it’s important you take steps to protect yourself. Diversification is one important step you should take.