Broker Check

Happy New Year

January 01, 2021

Happy New Year!

I hope you and your family had a wonderful holiday season, despite how different it probably looked and felt this year. For those of you who have been working with me for a while, you know I often describe the year’s market activity summary as “interesting”. Well, I don’t have to tell you that 2020 has taken the cake as both the most interesting and one of the most deeply challenging years of our lives. Not since 1918 has the world faced a pandemic the size and scale of COVID-19.

In the S&P500, we saw the fastest decline from an all-time high ever, followed by the best 50-day rally in history. Among other things, this year gave us opportunities to abandon our financial plans, to allow fear to take over, and multiple chances to make decisions we’d undoubtedly regret in the future. I was shocked to read a Fidelity report that about a third of their investors over the age of 65 fully liquidated all of their stock positions sometime between February and May of 2020 (and 18% of all their investors fully liquidated during that same time period). I am proud to share with you that none of our clients sold out of their portfolios during the market crisis or leading up to the uncertain Presidential election for emotional reasons. Through our ongoing communication, I asked you to trust in our plan and stay the course. You did, and that made a huge difference.

As of December 24, the S&P500 was up 65% from the lows registered on March 23, 2020. The numbers once again prove that the only reasonable reaction to a dramatic and unexpected market selloff - the likes of which we saw earlier this year - is to stay the course (assuming you are in the appropriately diversified portfolio for your financial position and comfort level with volatility). The massive drop and the subsequent robust market rally is the reason stock investors have enjoyed average returns of about 7%/year while bonds have averaged about 4%/year. We get generously compensated for uncertainty and volatility.

In leu of holiday cards this year, we decided to use those funds to enhance our philanthropic efforts. If there is another thing we’ve learned this year, it is that there is a great need to support our community, especially during difficult times. In addition to donating again to Junior Achievement DC (, we also adopted a five-person family through the Loudoun Abused Women’s Shelter (LAWS), and made a donation to George Mason University to support their newly-formed Financial Planning and Investment Management degree.

As 2020 comes to a close, I have hope that 2021 will bring a very different world than the one we’re leaving behind. Prior to 2020, no vaccine had been created in less than four years with most taking at least a decade before it was widely available. As more and more people are vaccinated, the pandemic subsides, restrictions are lifted, and our lives return to something close to normal, we believe the economic recovery will likely pick up speed – probably in the middle of 2021. Additionally, S&P500 returns have historically been strongest with a divided Congress – one party controlling the House of Representatives and the other party controlling the Senate. While risks certainly remain in 2021, we believe that we will power forward.

Thank you for the trust you place in my team and I, and thank you for allowing us to help in the achievement of your financial goals. It is an honor and one we don’t take lightly. As always, we are here for you if you need us, so please reach out. I wish you a healthy and prosperous New Year!

All my best,