by Ralf Sellig
Well, That Was a Week!
At Lucas Capital Management, we realize this is a stressful time for investors. In addition to health concerns, we are faced with a stock market that seems to have become untethered. Lack of clarity regarding Covid-19’s impact on the economy caused unprecedented daily swings in the stock market. As a result, many of us witnessed our account balances decline over the past few weeks.
At Lucas Capital Management, we are investment professionals who have personally experienced similar situations. Throughout this pandemic, we have continued to be available and transparent with our clients to discuss their fears and how they impact their portfolio and objectives. The following highlights our best advice managing investments at a time like this:
- Don’t stray from your long-term investment objectives. The important goals in your life don’t change frequently and your investment objectives are set to meet your goals.
- Recognize that the stock market’s long-term trajectory is up even though it never moves in a straight line. The average return of the S&P 500 is 11.5 percent per year since 1928, including years like 2019, being up 31 percent, and years like 2008, where it was down 37 percent.
- Set your asset allocation so that you can sleep at night. If market downturns like we are seeing now prevent you from getting a good night’s sleep, then we recommend resetting your risk level to a more appropriate lower level.
- Understand that your emotions may lead to poorly timed investment decisions, based on short-term market moves. Our fight-or-flight instincts cause us to react out of fear when the opposite response might be best. Alternatively, we may become overexuberant, not recognizing risk, when the market seems to rise every day.
- Partner with your investment advisor for the best results. Your advisor should bring a collaborative approach to help you address your financial challenges, analyze your options and choose the best solution.
We are available every day to have a discussion. Contact us and we would be happy to share our best advice on how to approach your current situation. At times like these, it’s useful to talk to a thoughtful professional while considering your investing alternatives.
Lucas Capital Management is an independent Registered Investment Advisor serving successful professionals and business owners. We act as your fiduciary at all times, which means we always put your interests first. To learn more about us, please visit our website or call us directly without obligation (732-758-1004).