First, we sincerely hope this note finds everyone safe and healthy in your world. Blessings abound for our team and our families, and we are grateful to be here to serve our clients and friends. To paraphrase the line from Cool Hand Luke, we will not be accused of a ‘failure to communicate’! Every month, on the last trading day when we rebalance our portfolios, we send a note to our clients and partners with an update on changes in the model and the status of price trends based upon our rules and systems. This month, we want to share it with our full audience, because we believe it is insightful regarding the current environment, and because we are proud of our work. Please read on.
What incredible times we are living through right now. About six weeks ago here in the United States all seemed quiet and strong. Of course, there are always problems, but by comparison to today, things were positive. Boy, that seems like a long time ago.
Regardless of how this coronavirus pandemic plays out, the lesson we can already take from this is that…you just never know. No matter how good things seem and no matter how long the fun ride has lasted, it always comes to an end, and usually when we least expect it. The movie Cocktail, starring Tom Cruise, brings us Flanagan’s Law, “All things end badly or else they wouldn’t end.”
We are clearly in an unprecedented environment where many are referring to the novel coronavirus as an ‘invader’ of our country. Elections are being postponed in Ohio, residents are being ordered to stay home in some jurisdictions, and businesses that normally never close are now shut down. From an investment perspective many advisors will refer to conventional wisdom as a way to calm clients. One example is the Best 10 Days Rule, and we believe it is a myth. Read on….
Topics: Behavioral Finance
By most measures, markets have entered a bear phase and are down almost 20% from all-time highs. The coronavirus, oil rout, and politics have combined to create a perfect storm in the markets. In times like these, what do we crave most? Surely, we all want to be safe and to know that the virus spread has slowed and that a cure or vaccine is ready to be deployed in abundance. We want to have control when none is available. Short of control, the next best thing we hope for under a constant barrage of bad news is…clarity.
When I first joined the team here at Blueprint, there were several "Ah ha" moments that stood out. Coming in, I considered my role as National Sales Director to be leading the effort to broadcast the power of Blueprint’s sophisticated, yet simple story. As I reviewed our existing marketing materials, I noticed a chart comparing our Growth strategy (an 80/20 stock/bond model at its baseline) to a traditionally allocated Balanced portfolio.