Newsletter Q4 2022

The walls of worry are endless, and the odds of the U.S. entering a recession are a foregone conclusion, especially if you ask any economist at any major investment firm. But the market is forward-looking and often a good predictor of what may come. Thus, it is plausible that 2022’s negative returns were the market telling us that we are in or entering a recession. As contrarian Humphrey B. Neill says, when everyone thinks alike, they are often wrong. It’s better to think creatively and differently about possible outcomes and timing.

Newsletter Q3 2022

The metaphor of the skipping record may be lost on many of our readers. We understand our advice may seem frustratingly similar and simple to articulate-that is, keep buying the dips in cheap, quality asset classes. We are upgrading the quality of clients’ fixed-income positions now that we do not have to “reach” for yield.

Newsletter Q2 2022

We believe in the resilience of capitalism and the ability for well-run companies to adjust and manage through times like this. So, we look at the next 6-8 months as a time to be picky, to diversify, and to avoid big calls or undue risks, especially after the powerful multiyear run we have enjoyed in the equity markets. Hopefully things turn out better AND sooner, but let’s not expect that. This year will be one to build portfolios for the next leg in the economic cycle.

Newsletter Q1 2022

Shorepoint’s advice in the face of all these points is to keep your expectations for making money in 2022 modest. The market’s reaction to the dour news has been decidedly muted but the probability of a recession has increased. We are treating rallies thus far as bear market rallies. We have decreased our core bond exposure given the rising rate and inflation environment. In turn, we have added to income-producing assets that are more resilient to interest-rate risk, such as floating rate bond funds, short-term inflation-protected bond funds, and cash. In addition, we have been adding to stocks on weakness as we find pockets of value in stocks of great companies that are attractively valued in the broader market. Some areas that look especially attractive are in healthcare, communications, industrials, and finance.

Newsletter Q4 2021

Try not to stress about news, politics, and issues we can’t control. Instead, focus on what you can do. Read. Nap. Spend time with family. Watch a good show. Go for a walk or get some sunlight on your skin.

Ok we will get back to the financial advice:

  • Expect market volatility with lower returns.
  • Spend less in economic downturns.
  • Spend more but also save more during the good times.
  • Consider part time work if you are retiring early or plan to do so.
  • Engage with us on making sure your financial plan is as accurate as can be.
  • Think and talk with us about how much risk you are comfortable taking with your investments; we have tools to model various scenarios for you.
  • Believe in the process of investing; when you feel yourself faltering, compare your long-term investment returns to your bank accounts.

Newsletter Q3 2021

Shorepoint’s process is thoughtful, disciplined, and flexible. Please know that our team is working diligently to manage risk and returns as well as position your portfolio for the long term. There are always reasons not to invest, but staying the course usually wins out. We believe that appropriate portfolio diversification amongst asset classes can help buffer your portfolio from the ups and downs of market volatility.

Newsletter Q2 2021

Shorepoint’s process is thoughtful, disciplined, and flexible. Please know that our team is working diligently to manage risk and returns as well as position your portfolio for the long term. While we see areas of overvaluation in both equities and bonds, the worries you read about in the press are mostly priced into the market. There are always reasons not to invest, but staying the course usually wins out. We believe that appropriate portfolio diversification amongst asset classes can help buffer your portfolio from the ups and downs of market volatility.

Newsletter Q1 2021

Shorepoint’s process is thoughtful, disciplined, and flexible. Please know that our team is working diligently to manage risk and returns as well as position your portfolio for the long-term. There are always reasons not to invest, but staying the course usually wins out. We believe that appropriate portfolio diversification amongst asset classes can help buffer your portfolio from the ups and downs of market volatility.

Newsletter Q4 2020

We prefer dividend-paying stocks to bonds, although having an allocation to bonds in portfolios is appropriate for diversification and to reduce overall volatility. The bond market, particularly government bonds, continue to be concerning, with interest rates at record lows and over $15 trillion in international government bonds trading at negative interest rates. We continue to diversify the fixed income portion of your portfolio in non-traditional bond sectors which rebounded in the later half of the year. Within equities, we will use a sizeable market pullback to add to high-quality stocks as they become more attractive.

Newsletter Q3 2020

Our current portfolio positioning is conservative relative to your personal investment objective and risk appetite. We are holding the highest cash and lowest equity levels in accounts than we have in over 10 years. This is reflective of the current market and economic conditions, the pandemic’s negative impact, and the uncertainty around the presidential election. We expect that these factors will continue to lead to higher market volatility through the end of the year. However, we look to add to equities on any meaningful pullback. We expect that any additional government stimulus would be constructive to the economy and markets. In the interim, we continue to make adjustments to our equity holdings to improve the overall quality of your portfolio and to take advantage of attractive opportunities. Our goal is to identify companies that will create economic value in this environment and develop long-term competitive advantages.