After the events of the past month, the investment markets seem to be in full panic mode. This is the result of the continued spread of the COVID-19 virus, the subsequent lock-downs across the world, and uncertainty over what all of this means for the economy. Traders on Wall Street have been selling at virtually any price, which has caused the markets to drop into bear market territory.
A question we get often is – “What should I be doing now?” Our first response is to take care of yourself personally. Your health is always more important than your portfolio. From an investment standpoint, there is only one rational answer to this question: it has never been a good idea to sell when everybody else is selling. The best strategy has, in the past, been to ride out the downturn and experience the subsequent upturn—which may come tomorrow, next week, next month or next year.
We want you to know that we are actively reviewing your accounts and financial plans. As stated previously, it is never a good idea to sell when everybody else is selling, but that does not mean we are sitting idle until the equity markets return to their previous levels. In the time being, here are some of the actions we have been taking:
While we are taking care of your portfolio, we also want to make sure that you are taking care of yourself from a personal standpoint. Some of our best tips are:
Avoid public places and large gatherings to the extent possible. At some point this WILL pass and we WILL be able to frequent the places at which we are all so accustomed to socializing. There is no reason to risk the health of yourself and others for short-term enjoyment.
- Avoid public places and large gatherings to the extent possible. At some point this WILL pass and we WILL be able to frequent the places at which we are all so accustomed to socializing. There is no reason to risk the health of yourself and others for short-term enjoyment.
- Now is an opportune time to look for losses in your portfolio that could offset capital gains that you may have in the future. By switching between similar investments, we are able to take losses while keeping you invested for the long-run. We will be analyzing accounts in the coming weeks for situations in which this may be beneficial.
- We have ongoing communication with the portfolio managers for the funds used in your portfolios. While we have confidence that they are exceptional long-term investors, we want to hear their current strategy and opinions, as well as learn of any changes they are making. Environments like these often provide opportunities on which prudent managers can capitalize.
Remember, we are here, and our goal is to help you get through this difficult period. We have talked to many clients already, and we encourage clients to reach out if they have any questions or want to talk through their plan. Unfortunately, these declines are an inevitable part of investing in equities, but we are here to help see you through to smoother waters.
Thank you for the trust and confidence you have placed in us and for giving us the opportunity to help guide you on your financial journey.
We appreciate you, and we look forward to speaking with many of you soon.
The information contained in this report does not purport to be a complete description of the securities, markets, or developments referred to in this material. Any opinions are those of Confluence Financial Partners and not necessarily those of Raymond James. Expressions of opinion are as of this date and are subject to change without notice. Investing involves risk and you may incur a profit or loss regardless of strategy selected. Keep in mind that individuals cannot invest directly in any index, and index performance does not include transaction costs or other fees, which will affect actual investment performance. Individual investor’s results will vary. Past performance does not guarantee future results. Future investment performance cannot be guaranteed, investment yields will fluctuate with market conditions. The S&P 500 is an unmanaged index of 500 widely held stocks that is generally considered representative of the U.S. stock market.