Greetings from the Tschetter Group on this last official day of summer.
We doubt that any of us will forget the year 2020 – quite an eventful year thus far and we still have 3+ months and an election to go! You’ve probably seen market volatility and political rhetoric pick up as we head into fall and approach the U.S. presidential election on November 3rd. This is not all that surprising and it’s the reason we have a fair amount of cash reserves in the equity portion of our client portfolios.
Throughout market history, especially in election years, there have been many Septembers and Octobers worth forgetting. We are ready to capitalize on potential near-term weakness and anticipate being a little more active should markets drop with election jitters. In that case, we could accumulate more stock in our existing companies where our long-term conviction remains high or find new additions to the portfolio at attractive prices.
As always, we are long-term optimists about the prospects of owning good companies and thus remain confident in the market providing the returns that will help our clients meet their goals. At the same time, we have learned to always expect the unexpected. It’s why we often have cash reserves in our equity portfolios that give us optionality to invest when others are forced to sell during downturns. Should volatility and market weakness show up in this highly charged and divisive period, be confident that we will act.
Please don’t hesitate to reach out if we can answer specific questions and also take some comfort in the fact that the election and 2020 will be behind us in a few short months!