Hey, Are You Doing Stuff?
Peace of Mind When the Markets Run Wild
In case you haven’t noticed (and it’s totally ok if you haven’t), 2022 markets have gotten off to a rocky start. Volatility has been the flavor of the month (going on two months now) and has investors wondering:
- What’s going on?
- Is the stock market ok?
- Are you doing stuff?
If you’ve been with us for a while, you know what we usually say when the markets act out: “Breathe. Volatility is normal and to be expected. Stay the course.”
Frankly, our advice hasn’t changed. But just because we are telling you not to do anything, doesn’t mean we aren’t…
(… doing things, that is).
Market Corrections Happen More Than You Think
As your advisors, we are constantly monitoring the economic landscape and seeing where adjustments might need to be made to your portfolio—especially when dips occur. And they do occur. In fact, dips probably occur more frequently than you even realize.
Let’s take a look at the intra-year stock market declines over the period from 1980–YTD 2022.
As you can see, a decline of at least 10% occurred in 24 out of 42 years (or 57% of the time) with an average pullback of 14%.
But despite these pullbacks, stocks rose with positive returns in 32 out of the 42 years.
So, the two takeaways here are this: (1) pullbacks happen all the time whether you know about them or not and (2) volatility does not presuppose loss!
Don’t Be Like Bill
Part of why you pay us is so you don’t have to worry when the market dips!
Take the following client scenario as a prime example:
I have a client we’ll call Ted. Now, Ted is a pretty even-keeled guy, but he is far from apathetic. He is a well-to-do business owner who has worked tirelessly to be able to take 14 vacation weeks a year with his family, one of which he spends on the beach with some other families they are friends with.
A couple years back during one of these weeks, Ted was sitting on his vacation beach next to his friend when the market opened up with some pretty chaotic energy. Ted’s friend—we’ll call him Bill—was frantically poking and scrolling through his iPad for hours while Ted propped his lounger back and casually sipped his libation of choice.
Now, what’s funny is not that Ted didn’t care. In fact, he cared a whole lot. Before working with RiversEdge, he said he would have been assaulting his laptop right alongside Bill. But he didn’t have to be that guy anymore.
When he got back and told me the story, he said, “Brian, I never want to be that guy again. You have no idea the sense of relief it brought me that I could enjoy my time out on the beach without having to worry about my money.”
Moral of the story: Why be like Bill when you could be like Ted?
In other words, if your financial advisor can’t take this stress off your plate and give you peace of mind that your money is going to be ok—even when the market dips—what are you even paying them for?
The “Stuff” We’re Doing
Investment management isn’t our only job, but it’s a large part of it. So, when things get rough or markets don’t perform in our favor, we are most certainly “doing stuff” with your investments to both (1) protect you from potential loss and (2) capitalize on upside potential.
How? With strategies like tax-loss and tax-gain harvesting, portfolio re-balancing, etc.
We tell you to stay the course, because we’re course correcting for you. We’re over here behind the scenes pulling the strings that will keep the wind in your investment sails.
The headwinds and tailwinds you hear about in the news? We’re already accounting for them (likely before you’ve even heard about it).
And that’s the way this is supposed to be. You hand over the rigging so we can navigate these market conditions for you.
Want Us to Handle Your “Stuff” Too?
At RiversEdge Advisors, we have an exceptional clientele we serve both in Wilmington, DE and virtually throughout the country.
But, we’re always looking to forge new relationships with business owners who are a good fit.
If you’d like to learn more about our service offerings and how we can help you, schedule a call with us today. We’d be happy to meet with you and discuss your financial planning and wealth management needs.