Stock market updates and Fox 2 News interview
I hope you are doing well and healthy in these unprecedented times surrounding this coronavirus pandemic. I wanted to give you an update of your investment accounts that I manage for you and let you know they have been performing well during this market slide this past month. Then view my Fox 2 News Detroit interview from Tuesday.
January 24-27th I sold most everyone's stock market ETFs and moved it to cash within your accounts (cash is FDIC insured within accounts). January 24th was an uneventful Friday except for in the news it was reported that the second case of coronavirus was detected within the USA. One case proved it could cross the ocean, but a second case seemed ripe for becoming a bigger news story. The stock market had been on a great bull run going up since Dec 2018 and technically we were due for a pause. To me the coronavirus seemed like as bad a reason as any to trigger it. I had no idea it would get this bad, and the economy would get this bad, and so fast.
But I am glad I made that conservative move within everyone's accounts as it seems to have protected your account balance from much of that down slide.
This week I began buying back into the stock market within most everyone's accounts. So far so good as it has been bouncing back up. The stock market still can go down further, but long term I believe we bought at a good discount.
My investing style is very stock biased and we want to be invested in the stock market long term. The core of our portfolios are one or a few ETFs to diversify your money into the stock market. It gives us the flexibility to be nimble in times such as these. We may also own a few individual stocks to keep some people more interested and motivated to save. Retirement accounts we can be nimble and conservatively move to cash, whereas taxable accounts require more analysis since it triggers tax consequences when we sell.
Our reason for buying back into the stock market this week is technically the market hit real low, over 30% down, so we are buying back the same assets we owned 2 months ago at a large discount. Also, fundamentally the govt is giving hope by planning to pass a $2trillion dollar relief package at the end of this week which should help preserve peoples jobs, the economy, and that is good for the stock market.
However, in April, I'm preparing for the stock market to possibly pull back down again to retest the lows we saw last week. So I may look to trim again in April if it seems this might happen. Things keep changing daily and I'll continue reevaluating for your benefit. Hopefully a cure is found soon and that should help stabilize the markets.
Investment summary example: we sold and then bought back the same equity ETF after it dropped 27%.
Jan 24th we sold 2039 shares of SPTM $40.66/sh = $82,904
Mar 19th we bought 2775 shares of SPTM $29.76/sh = $82,584
Other news: tax deadlines were extended until July 15th, however Michigan is still due April 15th. I have gotten through most everyone's tax returns so if you know anyone who needs help with theirs, please send them virtually my way.
Keep your job! Last week Congress passed the Families First Coronavirus Response Act worth about $1/2trillion. Another $2trillion dollar package will hopefully pass this week. Along with other recent regs are creating many new financial opportunities, but there's alot to unpack. I'll do my best to keep informed in order to help all my clients get their fair share. Businesses are trying their best to learn how to utilize all this free money the government is trying to pass to us all to keep paying employees even if you aren't working. Communicate with your bosses and small business owners to work within these new regulations. So hang in there and be hopeful.
I had an interesting day Tuesday when I got a call from Fox 2 News asking if I was working from home and if I'd be willing to do an interview about regulation changes on the Families First Coronavirus Response Act and tax deadline changes. Have a view and contact me if you have questions.