Calm in the Storm

Many of us are consumed with the latest news about COVID-19 and what may lie ahead.  The dramatic changes taking place in our daily lives can be stressful. It is our hope that we can lend perspective and calm to the evolving situation. A good place to start is by seeking out reputable news sources, such as https://www.cdc.gov/coronavirus/2019-nCoV/index.html.

It is important to realize that we are still in the early stages of a global event that may last for another year or two.  Nevertheless, every passing day brings us closer to a time when nearly everyone will be protected against the novel coronavirus by vaccination, and when life can begin to return to normal.  The fact that we can estimate an end to this disruption makes this crisis very different from previous ones, and is already influencing some investors to make additional equity purchases.

As we look to the near future, we won’t be surprised to hear medical news along these lines:

  • In the U.S., the number of COVID-19 cases may grow substantially
  • Globally, virus numbers will be much larger; some countries will suffer worse than others
  • People with risk factors for higher contagiousness and mortality will need extra protections
  • In the interest of public health, schools could remain shut for months
  • In response to greater clarity about the spread and impact of the virus, we can expect to hear the following about the capital markets and the economy:

  • Many thousands, possibly millions, of people in the U.S. will at least temporarily lose their jobs
  • Economic activity will slow and industries whose markets depend on gatherings of people will hurt the most
  • The Federal Reserve and other governmental entities will take extraordinary measures to preserve liquidity and normal functioning of the markets
  • Volatility will remain high
  • And what about your investment strategy?

    We have reminded clients for years that someday volatility would return, and there would be another market downturn.  We even went so far as to say that we probably wouldn’t be able to see a downturn coming. Given those realities, we programmed our financial planning systems to assume that market dynamics would impose stresses similar to those during the Great Recession approximately once every decade.

    We sometimes wondered if we were being too conservative in our estimates of investment returns.

    It was not uncommon for us to learn that competitors were more optimistic in their depictions of the future.  But the result of our conservative approach is that clients who have fully engaged with us, and who have a comprehensive financial plan, will have implemented strategies that contemplated disruptions like what we are observing in the market today.

    BIP Wealth has a unique and valuable set of investment strategies to weather financial storms.  For many clients it is essential to stick to your planned strategy, even as the market whirlwind consumes those that are impatient and don’t have a plan.  Our Personal Wealth Advisors are here for you. We stand ready to make needed changes to your investment strategies based on your individual circumstances.

    Each of us at BIP Wealth is facing the same challenges you face; in short, we are in this together.

    If you are interested in learning more about BIP Wealth’s many solutions to deal with market volatility, please email us at bipclientcare@bipwealth.com or give us a call at 404.495.5230.