We would like to reach out and connect with you as the coronavirus outbreak continues to impact communities, companies, and countries around the world.
You have placed enormous trust in Soundmark over the years to help guide you through all types of economic cycles, market gyrations and life events as you pursue personal and financial goals.
With the number of coronavirus cases across the U.S. and other countries continuing to grow, we are blessed to have dedicated health-care professionals at the front line of caring for those who are afflicted. There is much discussion about the effect and duration of the virus on humans, and its impact on the global economy.
The magnitude of the stock market decline, from the S&P 500 Index’s high on February 19 of 3386.15, to its bear market close on March 12 of 2480.64, is the fastest the market has ever dropped from an all-time high into a bear market – 16 trading days. Global stock markets may continue to sell off as the duration of the virus persists and its true economic impact is absorbed.
Planning for an uncertain future is what drives Soundmark’s financial planning process. The conversations we have had with you over the past twenty years and the decisions we make in portfolio construction are carried out specifically with today’s uncertainty in mind. While it can be unsettling to see the market decline on the magnitude of this past week, we are confident ongoing reviews of established financial plans will help alleviate anxiety in the months ahead.
The stock market might experience a quick rebound, as it did in 2009 when the economy finally worked itself through the financial crisis. The stock market might also trade agonizingly lower throughout 2020 and 2021, before returning to the levels of the recent past. No one knows.
To paraphrase our February 26 communication with you. . .
In the long run, global markets are driven, not by the emotions of the moment, but by the creativity and productivity of human beings. We are confident that this creativity will successfully address the coronavirus, and a longer term focus on portfolios will continue to reward investors.
Established financial plans allowed clients to move beyond the 9/11 crisis of 2001, the SARS crisis of 2003, the financial crisis of 2008, the European debt crisis of 2011, and the global economic scare of December, 2018.
Our experience has been that maximizing returns in common stocks over the past two decades was best achieved by letting one’s financial plan, not emotions, guide portfolio decisions.
This report is intended to be used for educational purposes only and does not constitute a solicitation to purchase any security or advisory services. Past performance is no guarantee of future results. An investment in any security involves significant risks and any investment may lose value. Refer to all risk disclosures related to each security product carefully before investing. Soundmark Wealth Management, LLC, its advisors and its affiliates do not provide tax or accounting services. This material has been prepared for informational purposes only and is not intended to provide, and should not be relied on for, tax or accounting advice. Please consult with your tax advisor prior to engaging in any transaction.