In the last six days, we’ve seen nothing but the market going down. Fear about the Coronavirus spreading has spooked the markets resulting in markets being down about 10% from their recent highs.
Where we go from here no one knows but rest assured, the markets will rise again. We just don’t know when.
In the meantime, I’ll be looking for opportunities to rebalance client accounts, if necessary, and for any way to save clients money on taxes. If you remember back to 2008 and 2009 when the market was down more than 50%, that was a great time to harvest some tax losses that would result in real tax savings for clients for years to come.
The advantage of being a long-term investor is that you have the time to weather storms like this, and even if you feel you don’t have a long time horizon, these storms normally don’t last very long and the markets bounce right back.
As I’ve written about before, the markets usually go up very quickly which is why we never get out of the markets during these downturns. If we miss even a couple of days when the market turns positive, we could miss out on a lot of growth. Over the years it has worked very well for our long-term clients to sit tight, let the markets do what they are going to do, and then reap the rewards when the markets again turn positive.
A possible pandemic is not a common event so we’ll have to just wait and see how the markets react going forward. But I remain optimistic.
In the meantime, wash your hands a lot, stay home if you get ill, and get tested if you’ve been exposed to the Coronavirus and think you may have contracted it.
And leave worrying about the stock markets to me. I’ll be keeping a close eye on things and looking for any single silver lining I can find.
Stay well. Stay happy. And don’t forget, wash your hands! 🙂