FPFA Monthly Insights - Iran, Trump Accounts & SpaceX (April 2026)
It has been a little over a month since we sent a communication out regarding the Iran war. In that newsletter we hoped for a swift solution to find peace and shared the consensus concern about a prolonged conflict. Since that day Iran's closure of the Strait of Hormuz brought shipping traffic to near zero, insurers withdrew coverage, and major shippers suspended operations which in turn had a negative effect on production as inventory swelled. On April 13th, the US further blocked maritime traffic as it imposed a naval blockade on Iranian ports in large parts of the Persian Gulf and Strait of Hormuz. As a backdrop to this we have a fragile and temporary ceasefire in place while negotiations, which have failed to this point, resume.
So what has happened to the market amidst this chaos? Not including today when the market again hit record highs, since March 16th:
The S&P 500 is up 5.99% after being down 4.31% from March 16th to March 30th;
The international index MSCI EAFE has been steadier and is up 6.53%; and
The Bloomberg US Aggregate Bond index has strolled along to a positive 0.76% return.
Who would have figured this? It goes to show you that Mr. Market often zigs when you think he will zag. In this instance, Mr. Market has been focused on the degradation of Iran's military capacity, what is considered an improved situation from the initial market drops in February, signals that Central Banks will provide supportive policy if a recession risk becomes imminent, some pockets such as energy performing well given the conflict, and a neutral consensus on corporate earnings which is good all things considered.
So now we have the classic battle between bulls who are pleased everything is moving ahead and bears who worry that the negative results of this war and sticky inflation haven't fully played out yet.
Please reach out if you have questions about your portfolio and want to take this conversation deeper.
In the meantime, we want to provide information about two topics that have surfaced in recent client conversations and that relate to happenings that will occur regardless of the war or inflation.
The two topics covered below are unrelated, but top of mind — Trump Accounts and the expected SpaceX IPO.
Trump Accounts (aka 530A Accounts)
My understanding is that Schwab will be ready for the July 4th target date for these to be available.
We've attached a primer comparing the Trump Account versus 529 Plans, Custodial Roth IRA's, and UTMAs. This newsletter in itself is not a recommendation as we should discuss your personal circumstance, but I will share very preliminary thoughts below.
People have commonly misunderstood the $1,000 federal seed money to be available to all kids. You have to be born 01/01/2025-12/31/2028 to receive this. It would be rational to take the free $1,000 if eligible.
In my opinion, beyond free money there may be better alternatives if your situation allows. For instance:
529 Plans continue to be the best option if you're prioritizing education funding. College costs continue to skyrocket, 529 Plan distributions are tax-free for education, the uses for 529 Plan money have expanded considerably in recent years, and excess money has flexibility with the ability to change beneficiaries and also the new provision to roll some of it into a starter Roth for the beneficiary. In addition, I consider investing in 529 Plans to help with your retirement investing indirectly as the presence of these funds makes it possible to continue saving for retirement instead of pausing that saving while paying for college.
Custodial Roth IRA's have higher limits than the Trump Account, maintain the flexibility of taking the cost basis back out if you need it, and the distributions are tax-free rather than tax-deferred as the Trump Account's distributions are. Lastly, while Custodial Roth IRA's require the beneficiary to have earned income, the definition of earned income is loose e.g. babysitting and lawn job money (maintain your records).
I believe you will see Trump Accounts used by those who qualify for the free $1,000, those looking for a quick and easy place to put aside long-term money for a minor, and those who may get an employer match. Otherwise, I think more deliberate planning will be biased towards 529 Plans and Custodial Roth IRA's. Always happy to discuss.
SpaceX IPO
Let's be very clear — this is not recommendation. However, several clients have inquired about the SpaceX IPO which is expected to occur this summer and be the largest IPO in history.
I don't know if it is going to live up to its potential valuation as the 6th most valuable company in the U.S. or if it will fall flat on its face. I will share though a few mutual funds and an ETF our clients have invested in to backdoor into the IPO because getting the IPO shares through direct purchase will be seemingly impossible. Again, this is for informational purposes only. We invite you to call if you want to discuss it more. Prospectuses are available by clicking the link below each option.
All funds are from Baron Funds as that is an asset manager we use regularly. There are of course other funds that also have high concentrations of SpaceX and Tesla (Tesla owns a small stake in SpaceX).
Baron Partners Fund (BPTIX). About 33% SpaceX + 23% Tesla (as of 3/31/2026)
Baron Focused Growth Fund (BFGIX). About 18% SpaceX + 6% Tesla (as of 3/31/2026)
Baron First Principles Fund ETF (RONB). About 9% SpaceX + 13% Tesla (as of 3/31/2026)
https://doc.morningstar.com/docdetail.aspxclientid=schwab&key=84b36f1bf3830e07&cusip=06828M108
https://doc.morningstar.com/docdetail.aspxclientid=schwab&key=84b36f1bf3830e07&cusip=06828M207
https://doc.morningstar.com/docdetail.aspxclientid=schwab&key=84b36f1bf3830e07&cusip=06829D107
On their own, each of these funds is high risk. They may make sense in your overall portfolio if you're willing to bear that risk. Or, you may just want to push a few acorns that way so you have a ‘fun’ holding to discuss at the water cooler.
This newsletter was not intended to be this long! Thanks for hanging in there and as always, please reach out to discuss these or other matters of interest to you.
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Front Porch Financial Advisory distributes its ‘FPFA Monthly Insight’ to clients and participants in the retirement plans it advises with the intent of providing information that may be relevant to a broad audience. The content is gathered from various industry resources such as money managers, licensing and education providers, and professionals in fields tangent to wealth management. This material is provided for educational purposes only and does not constitute investment, legal, tax, business, or any other advice. This information is not a substitute for such professional advice or services. Before making any decision or taking any action that may affect you or your personal finances, you should consult a qualified professional advisor.
