If you had cash to invest, yesterday was a brilliant day in the equity markets.
If you didn't, I suspect it was a bit gut-wrenching.
I believe that properly building an investment portfolio should take years (not days) to complete.
In the short-run, you may lag behind the "market", but different asset classes will have their "moments" when investors/traders give up on them because they are not performing and hit the sell button that sends them to very reasonable price points and if you have been patient, provides a great buying opportunity.
There have been 2 very decent buying opportunities in the equity markets over the past year:
Oct 15, 2014 and yesterday.
If you look back over my blog since its inception and have perhaps had the chance to listen to our weekly webinars, we (my business partner Paul and I) have been relentlessly (almost ad nausseum) beating the drum on how and why equity markets were expensive.
So we have been patient, until yesterday, when opportunity permitted us some great purchase opportunities for our clients.
I feel sad for those investors who's advisors put their money in to the market at any price, without some analysis of market trend, because not only did they miss yesterdays opportunity, but they also likely had to sit and watch while the value of what they owned (at higher price points) slipped further into the red.
That is where having a good, patient discretionary portfolio manager can be a real advantage: when opportunity arises, they can act quickly (of course within the parameters of your pre-established investment strategy) to adjust to changing market circumstances. That is added value. That is what you are / should be paying for.
An advisor who has to call you to get permission to make an adjustment may not be able to get to you in time.
Sometimes it pays to be patient and have cash ready for an opportunity when it arises and it may take months and sometimes years to get "fully" invested. Yesterday was a good day for those folks.
It is webinar Tuesday at:
Feel free to tune in to our recorded version at or about 5pm:
We will talk about the current state of financial markets and the global economy and other wealth management issues.
See you then!
Scott Tomenson,CIM Managing Partner, Chief Investment Strategist