Where did the time go? It’s hard to believe that it’s been 10 years since we thought the world was going to end. As we all remember, from October 2007 to March 2009, the S&P 500 plummeted nearly 57%. I’ll never forget the comment of one client as he moved his investment accounts from equity type investments to a fixed investment strategy, close to, if not at the bottom of the market. (ie Bonds and CDs) He said, “In my lifetime stocks will never get back up to where they were before the crash”. Sadly, he and many others missed out on the longest-ever bull market in U.S. stocks, during which the S&P 500 more than quadrupled.
While it was much faster, the previous bear market was initiated by the tragedy of 9/11 and provided the beginning of developing an investment strategy we are now using.
So, as we head into another week and month, there is no change in our money managers’ investment approach, that is, to stay fully invested with the unique strategies I continue to mention. One factor is a built-in strategy for a yearly cash flow, in addition to dividends, interest and market returns. In a rising market, the portfolio values tend to go up more than just the market returns. Another ingredient included is that, in the event of a sudden and dramatic drop like 9/11, the portfolios are designed to recover most, if not all, the losses. The only drawback is that, if the markets trend down, these portfolios will underperform market returns as we saw in the 4th quarter of 2018. (There is no free lunch) And, please always remember there are no guarantees when it comes to investing in the equity markets and investing does have risks.
After a torrid 2 months, the markets have cooled a little bit, and this was to be expected. Not sure what’s going to happen going forward, but it always seems exciting. The move of the office is almost complete, even though there is no change in the contact information. If you’d like to get with me or talk, please don’t hesitate to call or email. Hope you have a super week!