With Markets At All Time Highs, Is It Time To Get Defensive?
It’s been almost 10 years since we have had a major bear market like 2008 or 2000 when the markets dropped over 35% in just one year. Unfortunately, history proves that bull market positive trends never last forever, and when they change course it can be very damaging to a portfolio for many years.
Fortunately, the majority of CIS clients now have tactical managed portfolios. This style of proactive management strives to preserve account values as much as possible during major bear market selloffs by moving to cash or cash equivalent positions while still participating in bull market positive trends.
If you have a “buy and hold” type of portfolio that took 4 to 5 years to get back to a break-even point after the 2008 housing bubble and the technology bubble of 2000, now may be a great time to get tactical while the markets are still up. For many “buy and hold” investors, the first 10 years of the 2000’s were called the “lost decade” because the gains were offset by previous losses.
So what is one to do with all this information? First, I want our clients to realize if they have a fee based tactical managed account with Christian Financial Advisors, we are prepared to move to cash if we need to in the next major, long term bear market selloff to preserve as much account value as possible. No one can accurately predict just how long the present rally will continue, but as long as the trend continues to be positive, we will keep our tactical portfolios invested in the markets.
If you are not using a tactical strategy, now may be a great time to consider switching to one. A tactical strategy seeks to preserve account values as much as possible during bear market sell offs as well as participate in long term positive upward trends and rallies of bull markets.
Call 830-609-6986 for a phone or office appointment if you would like to discuss a tactical portfolio.
* Investing involves risks including the potential loss of principal. No strategy or product can assure success or protects against loss. Past performance is no guarantee of future results.
The views expressed represent the opinion of Christian Financial Advisors®. The views are subject to change and are not intended as a forecast or guarantee of future results. This material is for informational purposes only. It does not constitute investment advice and is not intended as an endorsement of any specific investment. Stated information is derived from proprietary and nonproprietary sources that have not been independently verified for accuracy or completeness. While Christian Financial Advisors® believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability. Accordingly, such statements are inherently speculative as they are based on assumptions that may involve known and unknown risks and uncertainties. Actual results, performance or events may differ materially from those expressed or implied in such statements. Past performance is not indicative of future results. For any discussion of equity securities: Investing in equity securities involves risks, including the potential loss of principal. While equities may offer the potential for greater long-term growth than most debt securities, they generally have higher volatility. For any discussion of taxes: Christian Financial Advisors® does not provide tax advice and encourages you to seek guidance from a tax professional.