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How the Market Works

Keep Your Eyes on the Road

Posted by kdadmin on February 28th, 2013.

It’s been another banner volatility week in the markets – sequester fears (market anxiety), the Italian election (market crash), and the housing market report (market rally).

Yikes.

The phrase, “but you’re long term investors” comes to mind. Investment professionals use it all the time. But, I hate that phrase. It encourages complacency. It’s like saying, “Don’t keep your eyes on the road, you have plenty of time until you get there.”

Instead, wouldn’t you feel more comfortable watching the road? Or, having your driver (me) watch the road? I think so. The short version of the traffic report for our clients is:

  1. If the sequester occurs, it could reduce 2013 GDP by roughly 0.75%. Even a brief shutdown in April could reduce the second quarter GDP by 0.25%. The longer the sequester lasts the more chaos it causes. Yay party politics …
  2. Your bond holdings have stabilized your portfolios nicely.
  3. Your high yield holding will pay about a 0.5% dividend today.
  4. You stock positions have weathered the storm well.
  5. While past performance is not indication of future results, we’re holding our own quite well.

Go to your web portal, located at http://zurichawes.com/My-Investments.html. To look at your specific results. I recently sent you a letter describing the login process. However, unbeknownst to me, the password requirements were “enhanced.” So, you have two options:

  1. Call us. We’ll set you up and walk you through it over the phone.
  2. Respond to the automated email from [email protected] that will be sent to you later today. Please note that the login address they provide is located on their site. It will be easier to remember if you just use the “My Investments” listed above, located on our site (www.zurichawes.com).

Lastly, I’ve enclosed a sample version of the performance report that will be generated on about the 12th of each month and posted to your web portal. (Note: in the graph called “Investment Growth (Cumulative TWR)”, your account is the shaded area and the benchmark is the darker single line.) When the report posts, you’ll receive an email notification. I’d prefer that you receive this report earlier in the month, but it takes a week or so for some of the vendors to post all of their data. I hope to whittle this down.

Enjoy the road. Call me when you need roadside assistance.

p.s. Please consider recommending me to other motorists who appear to be stranded on the side of the investment highway.

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