SPG Market timing vs Diversification

Marriott is acquiring SPG in a 12.2B deal.  Since Marriott have a totally crap award program (with perhaps one exception) that’s really not great news for the travel ‘community’.

My biggest worry from this transaction is that my SPG points will become Marriott points.  While I don’t have too many, 52K for me, 12K for the Mrs, I don’t want them to become Marriott points.  Right now, I could transfer 20K SPG to 25K AA, so that means I have about 79K potential AA points sitting there today, vs 1 night in the Marriott methadone drop in center in Boise, Idaho should the points merge.

What to do?

When a company acquires another, they typically merge the award programs.  As such, I expect if I do nothing, one day I’ll get an alert saying that I am now the proud owner of a bunch of Marriott points.  The question though, is what to do about that.

Do you take control of the situation, or let the situation take control of you?

Interestingly, the latter seems like the incorrect, inferior election. However, if we draw a correlation with the stock market, the key is not to try to control every outcome, but rather have sufficient diversification in place to weather the storm.  You can’t control the myriad of random events that are in place, but you can control their impact on your situation.

In other words, how do you best position yourself (at all times) to be protected from swings in the market of stocks or points?

In the SPG example, I feel confident that the points will merge and devalue.  However, I don’t know when, or with how much notice. It is likely to be up to a year to happen.  If we transfer out of SPG in a knee jerk manner, what does that do?

Case 1 – you screw it up

If your need for AA miles isn’t immediate, you could be transferring out of the frying pan and into the fire.  For example, you might now be sitting on too many AA miles, and they then announce a devaluation.  Or, in some weird twist of fate, SPG continues to offer transfer bonus ‘bonuses’ to drain accounts (unlikely, but you never know…)

Case 2 – you get it right

You transfer out, and the next day everyone else in the world gets pushed from SPG to Marriott, with or without due warning.  You go on to book your First Class ticket to somewhere exciting, and cash in your Marriott tier 3-5 cert for 7 nights at Al Maha #boom

What to do?

Meditate.  Visualize every possible outcome and find out which ones you will be happy with.  You can never perfectly ‘time the market’ to get the best possible value, but you can position yourself to be protected from the biggest falls by thinking calmly, and making actions that work in your favor.

One thing that I did do was look up if I could internally transfer SPG, and the good news is that you can (as of now..) by using this link  this is good because SPG adds the airline transfer bonus of 5K only when you move 20K, so in my case, my 50Kish and 10Kish become 60K ish, and gain 3x5K transfer bonuses should I elect to go that route.

Personally I’m thinking to transfer to AA, and hoping that my Marriott cert is usable at SPG when I extend it to top tier early next year.. remember, you’ve gotta visualize it being possible in order to achieve it!

PS – watch out for anyone giving speculative advice about this and recommending you get another SPG card – chances are they get paid commission for that advice and don’t give a rats backside if you get stuck with Marriott points or not.