March 2019 Client Letter
For over 30 years, investors subscribed to Richard C. Young’s monthly investment strategy report, The Intelligence Report (IR), for advice on how to become more comfortable and consistent long-term investors.
Last year ended on a sour note for stock-only investors, with the S&P 500 losing more than 9% in December and more than 13% for the quarter. December’s performance was the second-worst December on record for the index. While we weren’t surprised by the correction, the magnitude of the decline looked excessive given the lack of any meaningful negative surprises.
The New York Times ran a piece in December titled “Investors Have Nowhere to Hide as Stocks, Bonds, and Commodities All Tumble.” The article highlighted the difficulty investors faced in 2018. Most major asset classes fell last year or edged out minimal gains in the final few days of the year.
Here is something I’ve been reviewing with clients that is helping with their unsettledness over the past three months. Most of you have a balanced portfolio, which includes a mix of cash, bonds, precious metals, and stocks. When you hear and read about the market’s decline and the uncertain period ahead, it is wise to remember these nasty headlines are not affecting your entire portfolio. Most of you have approximately 50% invested in equities and the other 50% invested in securities which tend to hold their value or decline less compared to stocks.
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