November 3, 2021 Market Commentary
The Stock Markets rebounded strongly in October to recover its losses from September. On November 2nd, surprise news came out that the supposed contract between Hertz & Tesla for 100K vehicles was not a done deal. As expected, the Federal Reserve announced today it will soon begin reducing the pace of its monthly bond purchases by up to 15 billion each month, which it started to support the economy during the pandemic. This is the first step towards pulling back on the massive amount of artificial stimulation it has been providing the markets and the economy. The markets are already starting to price in two to three possible interest rate hikes for 2022 but when it actually happens the market may not react favorably.
We moved a portion of our cash position into Healthcare & Life Sciences on Oct 21st as the position had declined almost 20% from previous pricing levels. Our intent with our cash reserves was to invest in discounted buying opportunities of at least 10% or more so we feel this was a good decision. This healthcare position is already up almost 4% since we purchased it and we are hopeful it will continue to rally back towards previous levels.
Our Biblically Responsible Portfolio Positions at this time
- Ultra Conservative: 95% Fixed Income with no equity positions and the remainder in cash.
- Conservative: 76% Fixed Income / 19% Equity and the remainder in cash looking for buying opportunities.
Normally this strategy would be invested in as much as 25% in equities.
- Moderate: 45% Fixed Income / 37% Equity and the remainder in cash looking for buying opportunities.
Normally this strategy would be invested in as much as 60% in equities.
- Growth: 18% Fixed Income / 68% Equity and the remainder in cash looking for buying opportunities.
Normally this strategy would be invested in as much as 80% in equities.
- Aggressive: 0% Fixed Income / 86% Equity and the remainder in cash looking for buying opportunities.
Normally this strategy would be invested in as much as 98% equities.
Rest assured, we are continuing to monitor events, the markets and our portfolio holdings both hourly and daily, many times into the late evenings and early morning pre-trading hours. We still believe there is a high likelihood of a market pullback, especially in certain asset classes and sectors when the Federal Reserve really starts to wain the economy off of all the artificial stimulation it had given over the last 12-18 months. When we identify additional buying opportunities, we will move the cash on hand into those areas across our portfolio strategies but at this time almost all asset classes are overpriced.
As a Fiduciary based firm, we act as your trusted financial advocate. We exist to serve you, not the other way around, and we do not take this responsibility lightly. If you have any other questions or concerns, please do not hesitate to call or text our office at 830-609-6986 or you may reply to this email. To learn more about our Biblically Responsible, Seven Investment Management Principles on our website… CLICK HERE
Bob Barber – Senior Wealth Advisor Shawn Peters – Wealth Advisor