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What A Day – A Wealth Management Note

A Message from Jim Ferrare, Withum Wealth Management’s Managing Partner.

As we write this post, Hurricane Zeta is strengthening as it approaches New Orleans. At the same time, Vietnam has evacuated 1.3 million people as they brace for Typhoon Molave, anticipated to be the worst storm in the past 20 years. It almost feels like nature is manifesting the turmoil that we are living in. Our thoughts and prayers go out to all impacted.

Separately, in what seems like almost comic relief, Tech CEO’s are being grilled by the Senate on live TV-who says no one watches regular TV? Unfortunately, we are also getting more bad news on the COVID front. Phase Three drug trials have slowed some as pharmaceutical companies are being prudent with their progress and announcements. Europe’s second COVID-19 surge is intensifying with rising hospitalizations, deaths and talk of “modified” shutdowns.

The inability to patch together a stimulus package, election outcome concerns (whatever side you are on), worries of potentially higher tax rates, higher deficits, fears of double-dip recession and satellite photos indicating Iran is building an underground nuclear facility are all weighing on the market.

As of this afternoon, the Dow Jones Industrial Average, a broad measure of US “blue chip” stocks, has officially entered “correction” mode; down 10% from its most recent high recorded on September 2, 2020, on an intraday basis.

We encourage all investors to take a fair accounting of their financial and emotional ability to absorb volatility.

  1. It’s never “too late” to reduce portfolio risk.
  2. Always look to be opportunistic.

As an example, if the market decline creates an unrealized loss think about offsetting a previously realized gain. If volatility continues to rise give thought to profiting from rising levels of fear.
At Withum Wealth, we approach investing from both an absolute and relative perspective. We know creating a portfolio that generates a smoother return increases the likelihood investors stay on plan and do not exit the market at inopportune times. Generating a less volatile portfolio, when for example fixed income seems so unattractive, is of course the challenge. We are happy to have that conversation.
We can provide a virtual complimentary portfolio review day, evening or weekend. There should always be an opportunity to add value.

Please feel free to email us at infoWWM@withumwealth.com or call our office (732) 450 0147 to schedule a call.

Withum Wealth Management

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