Greetings!
We hope this letter finds you and your family safe and well. Here at Gallagher Wealth Management, our job is to find financial solutions for you and our other clients. In other words, we want to do everything we can to reduce your financial stress so we can increase your financial wellbeing. But we also spend a lot of time worrying about your
personal
wellbeing – especially now, given the pandemic. So, we hope you are staying healthy, and that you can find pleasure in being with your family during these uncertain times.
Lately, many clients have told us how slowly time seems to be moving, given social distancing and the never-ending barrage of virus-related headlines we’re all subjected to. Despite that, spring is now here, and the first quarter of 2020 is drawing to a close. That means your quarterly statement will soon arrive.
There are two things to know before it does. First is that we have just been through one of the swiftest and most sudden bear markets on record. As a result, almost every investor experienced setbacks during March, including those with relatively conservative portfolios. We’ll explain why in a moment.
Second, and most important, is that while bear markets aren’t fun, they are
normal.
After a historic eleven-year bull market, we were frankly overdue. The good news is that after reviewing your portfolio, your allocation, and your goals, we firmly believe you remain on solid ground. As you know, we invest for your
long-term
future, not for a specific week, month, or quarter. While the coronavirus has knocked our
short-term
results down, it has not changed our long-term outlook. It has
not
knocked you off course to reach your financial goals.
So, let’s take a quick look at what’s going on. While the coronavirus has infected hundreds of thousands of people, it’s
affected
billions. People have lost their jobs or seen their pay drastically reduced. Others have had to change the way they work. Whole industries are dealing with snarled supply chains, smaller workforces, and plummeting demand. The fact the virus has spread so far, so fast proves that we live in a global, interconnected world – with a global, interconnected economy. Those who are sick, have lost loved ones, or who are on the front lines combatting this virus have the most on their minds, of course, but almost everyone has seen life change in some way.
In a historic pandemic, nothing is immune – and that includes the markets.
Having coached clients through several bears, we know from experience that it’s not fun to open a quarterly statement during times like this. It’s normal to feel frustrated or concerned whenever the markets don’t perform the way we want them to. So, we encourage you to remember a few things:
1. Bear markets are temporary.
Again, we at Gallagher Wealth Management, have seen this story play out many times. The cause of every bear is different, and some last longer than others. But they
always
end – and when they do, the markets eventually rebound, and often go on to new heights! It happened after the crash in 1987. The dotcom bust in the early 2000s. The financial crisis of 2008. You get the idea.
2. Epidemics usually don’t affect the markets for very long.
1
Take a look at this chart: