What an interesting year we’ve had so far. January kicked off with a relatively strong start, but the last week of February, with fears of the coronavirus spreading across the world, sent equity markets into a downward spiral. Near the end of March we literally hit rock bottom, but somehow the markets ignored the continued spread of Covid-19, protests, political, countries being closed to travel, and states now going back to closing certain areas of the economy, to have the best quarterly performance in decades.
So where do we go from here? Does the market come to its senses and start to go back down. Looking forward into next year, I can’t see the economy rebounding from the pandemic as quickly as the stock market has recovered. Shouldn’t this signal the end to the 11 year bull market? The only way the market goes up from here is there’s so much risk in bonds and in foreign markets, that the US Equity market maintains its current upward trend. But is it really sustainable. One thing the market likes is certainty. But with the Presidential election coming and no end in sight with Covid-19, I’m certain of only one thing and that is more volatility in the short term.
That said, our strategic asset allocation models at ISWM are positioned to lower risk in a downturn and still participate on the upside. We continue to monitor our positions, adjusting allocation percentages, and at times replacing holdings when we feel it’s prudent to do so. We are not market timing, we aren’t trying to be tactical by selling when the market goes down and buying when the market goes up. In fact we have been doing the opposite. Buying low and selling high in our rebalances so far this year. We did a full rebalance of all allocation models in January, March and again in June. Hopefully that has helped smooth the rollercoaster ride the market has experienced in the first half of 2020.
Over the short term and long term, we continue to provide strategic asset allocation mutual fund and ETF models that provide diversification across all risk tolerances and stock models that provide more equity exposure using individual stocks picked by some of the brightest minds in the industry. We feel confident that there are enough choices to provide a reasonable level of return to help meet of your goals.
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Investment Advisory Services offered through Independent Solutions Wealth Management, LLC, an SEC Registered Investment Adviser.All opinions expressed by Dan Neiman are solely Neiman’s opinions and do not reflect the opinions of Independent Solutions Wealth Management, LLC (“ISWM”). You should not treat any opinion expressed by Neiman as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of his opinion for educational purposes only and does not constitute investment, legal or tax advice, an offer to buy or sell any security or insurance product; or an endorsement of any third party or such third party’s views. Neimans’ opinions are based upon information he considers reliable, but neither ISWM nor its affiliates and/or subsidiaries warrant its completeness or accuracy, and it should not be relied upon as such. Neiman, ISWM, its affiliates and/or subsidiaries are not under any obligation to update or correct any information provided on this website. Neimans statements and opinions are subject to change without notice. No part of Neiman’s compensation from ISWM is related to the specific opinions he expresses. Past performance is not indicative of future results. Neither Neiman nor ISWM guarantees any specific outcome or profit. You should be aware of the real risk of loss in following any strategy or investment discussed. Strategies or investments discussed may fluctuate in price or value. Investors may get back less than invested. Investments or strategies mentioned may not be suitable for you. This material does not take into account your particular investment objectives, financial situation or needs and is not intended as recommendations appropriate for you. Before acting on information, you should consider whether it is suitable for your particular circumstances and strongly consider seeking advice from an investment adviser.
Paul Meeks is on CNBC’s Squawk Box to talk tech stocks in the market for 2021.
In light of the volitility we have seen throughout the course of 2020, Independent Solutions Wealth Management has been monitoring our strategies carefully and focusing on readying our portfolios for our next steps.