Dear Clients--
The presidential election is
tomorrow and I want to share my perspective and make a few big-picture
predictions.
First and foremost, I
recommend you remain invested if you are already in risk-appropriate,
long-term portfolios. For most clients, I am offering and/or using the
following:
Investor
Style*
Portfolio
Model** Strategic Asset Allocation
Conservative
20 Strategic III or 20
Schwab Index
20% stocks, 80% bonds
Moderately
Conservative 40 Strategic III or 40
Schwab
Index 40/60
Moderate 60 Strategic III or 60
Schwab
Index 60/40
Moderately
Aggressive 80 Strategic III or 80
Schwab
Index 80/20
Aggressive 95 Strategic III or 95
Schwab
Index 95/5
*
If you are not sure of your Investor Style, let's talk soon.
**
Strategic models are generally for
tax-deferred accounts. Schwab Index models are generally for
taxable accounts. There are several versions of the "Strategic"
models, with "Strategic III" delivering my latest asset allocation
and mutual fund advice.
Perspective
·
In my 15 years as
a financial advisor, I have guided clients through the end of a bear market
(tech bubble, Enron, 9/11), a modest/slow recovery during a time of global
conflict (war on terror), a terrible market crash (housing bubble/financial
crisis), and (presently) a vigorous stock market recovery despite relatively
weak economic growth. My clients' best results have almost always been
for those who remained invested and rode out the storms.
·
The "Index Chart" shows numerous global events and stock/bond market
performance on a nearly century-long time line. I believe it illustrates
there is often something to rattle markets and that it is best to remain
invested for the long-term. https://static.vgcontent.info/crp/intl/auw/docs/resources/index_chart.pdf
·
This chart shows how difficult it is to time the market
well enough to avoid harming long-term returns: http://www.businessinsider.com/cost-of-missing-10-best-days-in-sp-500-2015-3
·
This
article discusses some history of stock market reaction to presidential
elections: http://www.wsj.com/articles/postelection-blues-stocks-rise-before-elections-then-often-slow-1478488500?emailToken=JRr8fvl5Z3Seh9Y9acwk00Y0Y60FAPOIQVWSJnTXN1OJr2DSquG6gr80nNbyq26hQlx3ot0A4mUjRDrXmy92XMKX3rlxjVqiPmJZqY6BiFHUahiLzBPSJQ%3D%3Dhttp://www.wsj.com/articles/postelection-blues-stocks-rise-before-elections-then-often-slow-1478488500?emailToken=JRr8fvl5Z3Seh9Y9acwk00Y0Y60FAPOIQVWSJnTXN1OJr2DSquG6gr80nNbyq26hQlx3ot0A4mUjRDrXmy92XMKX3rlxjVqiPmJZqY6BiFHUahiLzBPSJQ%3D%3D
·
I am keeping my
own retirement money invested as-is.
Predictions
·
Clinton likely to
win, markets not likely to go down if she wins, could go up sharply.
o
We've had a pull-back
recently and the markets seem to expect a Clinton win and don't like surprises.
·
Trump win
probably means a short-term market sell-off and recovery within a few months,
but probably not a bear market or a crash.
o
"Brexit"
vote earlier this year is considered a predictor because of similar, and
perhaps underestimated, anti-establishment and isolationist mindsets among
voters in UK and USA.
Thank you, and please contact
me with any questions or concerns.
--Gary
Garo
Linck Partoyan
Potomac
Wealth Strategies, LLC
(703)
746-8195 phone
(855)
347-9483 fax
No comments:
Post a Comment