A few weeks ago, we distributed a link to our “Half-time Report” video where we touched on factors that could impact market performance for the remainder of 2020. If you missed that and would like to view our full presentation, please click here:
For a condensed summary, please read on.
It’s difficult for anyone to say with certainty what lies ahead because no one knows what will happen with COVID-19. Even though people are returning to work, the virus has not disappeared, a vaccine has yet to be proven effective, and there is no known cure for the disease.
Right now, we have more questions than answers.
Additionally, there is an election on the horizon, and it seems that both Democrats and Republicans believe that if the other party wins the White House in November, that drastic consequences will result. Unfortunately, we will all be bombarded with scary messaging between now and November 3rd designed to get us out and vote, and vote we should! But once the ballots are tallied and the decision is finalized, we are confident that regardless of whom America chooses to be President for the next four years, we will still have diverse voices in both the House and Senate which will temper the worst-case scenarios that the campaign ads promise. It is highly unlikely that an extremely conservative or liberal agenda will be able to be realized. We will find middle ground. We also believe that the markets will recognize this, and while there will likely be some ups and downs, in the long run we will be better off. In our opinion, this single election will not make or break our nation, and before you know it four more years will pass and we will be doing this all over again.
No matter what the future holds, the fundamentals of investing have not changed. While it’s tempting to respond to recent events, especially frightening ones, by moving to cash or reallocating investments, it’s rarely the right choice. Your allocations and investments were chosen to help you reach your financial goals. If your goals haven’t changed, it’s important to keep your eyes on the long-term.
While this is easy to say, you may still be feeling uncomfortable about what may lie ahead. If this is the case for you, we recommend that you re-evaluate your “buckets”. It may help you feel confident if you know that you have the next year’s worth of expenses set aside in cash or lower-risk investments that are accessible as a part of a well-diversified portfolio. Knowing that money will be there for your immediate needs will allow your other investments the opportunity to grow, even if there are future short term pull-backs.
As always, please keep us informed of any significant life changes, and feel welcome to reach out with any questions or concerns. Stay safe, stay healthy, and be well!
Any opinions are those of Alex Greene and not necessarily those of Raymond James. The information contained in this blog does not purport to be a complete description of the securities, markets, or developments referred to in this material, nor is it a recommendation. Investing involves risk and you may incur a profit or loss regardless of strategy selected, including diversification and asset allocation. Every investor's situation is unique and you should consider your investment goals, risk tolerance and time horizon before making any investment. Prior to making an investment decision, please consult with your financial advisor about your individual situation.