By Mark Shone, President
We are writing to update you on what we are doing operationally, what we are doing on your behalf, and to let you know that we are accessible to you.
Shone Wealth Management is operating remotely due to the order of Contra Costa County. I am sure you have questions about our ability to manage our business and your assets in this environment. Our business operations are all set up on the cloud and we are fully operational as it relates to available contact with clients, operational movement of money, and, of course, trading. There are no limitations in our ability to serve our clients other than the face-to-face meetings that typically take place. We are available via phone, email, or Zoom meetings. We have been very busy working on your behalf with many of the items that we list in the bullet points below and without interruption.
Between the Coronavirus pandemic and other geopolitical tensions, such as the recent oil price dispute between Russia and Saudi Arabia, the markets have also been on a rollercoaster ride, with each day bringing more uncertainty. The headlines tell us that we are living in an unprecedented time.
We know that being an investor today, and during any period, isn’t exactly a stress-free experience. But the feelings of panic and fear felt by many during these times are distinctly acute. The natural reaction can be to respond emotionally during these developments and get away from the financial planning and long-term plans we’ve built together. We’re facing a moment in history where we are tested in many respects, but as it relates to your finances, you have a team that has managed effectively through many environments that test our knowledge and expertise.
The good news is that at Shone Wealth Management, we have an investment process and guidelines that help us navigate through these difficult moments. We’ve listed a few here:
- We know portfolio construction matters. When we build portfolios, we match the risk/return profile to the goals we have set together throughout the planning process. That process guides us to allocations that are appropriate for each client situation and not a call on the short-term direction of the market in either direction.
- We do not own stocks for clients with the money they will be spending in the short term, which is typically beyond five years. This approach allows us to hold stocks through the downturns and allow them to recover over time.
- We rebalance when the market gives us the opportunity and do tax-loss selling in taxable accounts. One way to produce better long-term results is to take advantage of sell-offs like we are currently seeing and rebalance your portfolio back to the recommended allocation. This is not to buy “the” low, but instead to buy low. Rebalancing has been shown to improve returns over time and that opportunity usually shows up when you feel the worst about buying stocks, like now.
We’re prepared with a long-term perspective, appropriate diversification, and an asset allocation that aligns with your risk tolerance and goals — these tools help us remain disciplined enough to ride out the bumps along the way. At Shone, we also play a critical role in helping you work through these issues and in counseling you when things look bleak.
There is no questioning the emotional, physical, and mental toll that the Coronavirus pandemic has caused, particularly for those with family members and loved ones affected by the virus. While we participate in social distancing, maintain strong personal hygiene, and follow the guidelines outlined by the CDC and WHO, it’s important to “keep calm, and carry on.”
We must apply the same mindset to the financial markets. Predicting future events in the markets correctly — let alone predicting how the markets will react to them — is difficult to do. However, what is certain is that market volatility will always be a part of investing. To enjoy the benefit of higher potential returns, investors must actually stay invested long enough to see the other side of the storm and take some opportunities along the way.
We are always available to speak with you directly or correspond via email about your specific situation or concerns.
All of us at Shone Wealth Management