Built For This
So much has happened since we last checked in (less than a week ago!) that we thought we’d connect with you again to share a few words that we hope will provide some comfort.
First, on markets and your portfolio (but only because that’s what’s dominating the news – we’ll get to the bit that’s even more important later) and your financial plan:
- Bad days (like April 3 and 4) and whipsaw days (like April 7 and 8) always have been (and always will be) part of a Client’s experience. You’re built for this. And you can continue to trust that, as ever, markets climb a wall of worry. There is always something to worry about. And, ultimately, markets climb (because human beings are resilient and growth seeking).
- Days like today (April 9 – objectively good in terms of market movements) further prove the point that you can’t time the markets, and while few may have expected today’s news (unlike Monday’s fake news) about tariffs being paused for 90 days (except on Chinese imports), every investor who went through the last week is surely happy their portfolio experienced today’s bounce.
- Your portfolio was built for times like this, and times like this provide experiential evidence (which aligns with the academic evidence) for diversification. When everything is shifting around you, you need a portfolio that can capture growth from wherever it emerges, whenever it emerges. Being globally diversified amongst a broad array of asset classes helps to shield your investments from some of the downside risks. And that’s a chief reason why your portfolio of stocks is outperforming its benchmark (the ACWI), the S&P500, and the NASDAQ year-to-date (through today).
- And, importantly, your financial plan was built for this. Recall that we stress test every plan we create by engineering 10,000 scenarios, confirming that your projected success rate is robust. We don’t plug in the headlines or the political party in power, but we absolutely do plug in the kind of market volatility we’ve been experiencing. Your plan is resilient enough to meet the challenges of this month (and anything to come) head-on.
Markets will continue to digest the information on the tariff policies as the news evolves (and it shows us markets are working as they should – at the end of the day, the markets are made up of the billions of people around the world going about their daily lives, as we noted last week, and reacting to news in real-time). On the one hand, markets like news about negotiations (and pauses!), as that’s an indicator that investors can start to look forward to countries engaging in productive trade, which drives the economy. On the other hand, markets don’t like news about escalating tensions between the two biggest economies in the world (the US and China). Let’s hope cooler heads prevail and that we get more of the former and less of the latter as we go forward.
In the interim, we’ll bring your attention to the two days sandwiched in between the five aforementioned days above (this is the important stuff we were alluding to at the top).
While markets slid heading into the weekend and have been bouncy coming out of the weekend, they stood still over the weekend, as always. Which gave us all a moment to breathe. To spend time with our loved ones. To rest and recover and reconnoiter.
Our relationships with others (and with ourselves!) are at the heart of what matters most (regardless of the day of the week or whatever the market is doing). In times like these, we encourage you to invest your time and energy to take care of yourself and those you love most – hug your nearby loved ones, call your far away loved ones. Go for a walk, exercise and generate endorphins. Drink more water or a cup of tea. Meditate, spend time in nature, or just pause to take a deep breath and relax your shoulders. Learn something new, or read a good book that feels like talking to an old friend. Know that this, too, shall pass and we’re always here for any conversations you want or need to have.
For more on these topics, tune in to our live webinar on Wednesday, April 23 (you can register here). We also invite you to revisit your sources of resiliency and the things you can control and remember that you know a thing or two about Living Big, even when it might feel hard to do so.
In the meantime, dare to live, in spite of the fact that it may feel scary. Live, and Live Big, anyway.
The Yeske Buie Team