What’s Next?

I always enjoy writing with good news and have some for you today. As I write this, the S&P is up roughly 32% from its lows in March and we are only down a “mere” 13% from its all-time highs. Seems like a long way to go to get back to highs but we will, eventually. Believe it or not, if you go back to the first week of 2019, the S&P is up over 16% from that date—hard to believe with the media hype out there.

Let’s add some more good news:

  • Those of you who stayed the course have been well rewarded over the last few weeks. We want you to keep in mind that we aren’t measuring goals and timelines/time horizons in months but rather years.
  • Our portfolios have held up well and recovered the way we had hoped. Fixed income (bonds) have underperformed but we feel that is much more “mark-to-market” related than it is based on the fundamentals of the issuers.
  • We have been looking for opportunities within the markets and they are certainly out there. Our focus has been on large companies with fortress balance sheets.
  • We feel food about the markets reaction to the Feds policies.

How about the bad news:

  • Not all is rosy. We certainly aren’t out of the woods and have some big milestones ahead of us. The Country has to reopen; find a vaccine or treatment and we still have the election looming over us.
  • Unemployment claims as of this morning topped 30 million in the last six weeks. To put that into perspective, during the recession of ’08 and ’09, claims were under one million.
  • The bond market has not rallied like we would have expected even with the Fed backstopping some of the debt. We are keeping an eye on this and will make changes should we need to.

Now for some perspective. In speaking with clients over the last few weeks, I have noticed that many clients benchmark their accounts against all-time highs and not their original investment. It would be great to always see all-time highs but markets don’t always go up. Consolidation needs to occur and, in many cases, it’s not just healthy, it’s an opportunity for those willing to take advantage. Think of your account like owning a business. You will have up years and down years but over time, you hope to have more winning years than losing years. The market works the same way and companies go through the highs and lows as well. Even though Apple is down from its high of $327, now at $291, you should still feel good if you bought it below $250. You are still ahead of the game.

The information in this material is not intended to act as individualized tax, legal or investment planning advice. Please consult a qualified lawyer, tax professional, financial planner or investment advisor for specific information regarding your individual situation.