Navigating 2020

By Laura Chiesman 

2020! Wow. Here we are at the beginning of our next decade. We hope the last decade was a good one for you and your loved ones. As we all anticipate the future, let’s look at a few of the headlines from 2010 and where we are now:

The World Struggles to recover from a Global Recession – By January 2010 the financial hemorrhage that was the Great Recession seemed to have stopped, but it was still too early to be sure. The Dow had risen significantly from its low of 6,547 in March of 2009 to its opening at 10,243 on January 2, 2010, but it was still not back to its previous high of almost 14,000 back in September of 2007. The Dow closed on December 31, 2019 at 28,538.

North Korea Attacks – In 2010 North Korea sank a South Korean ship in the Yellow Sea, killing forty-six sailors. They also fired a barrage of artillery rounds at South Korea’s Yeonpyeong Island, killing two soldiers and two civilians. Kim Jong-il has since died and now his son Kim Jong-un controls this reclusive country. We are still having to deal with their saber-rattling, nuclear tests and rocket launches.

Midterm Powershift in Washington – In 2008, President Barrack Obama stormed onto the world stage like a rock star with a vision to rebuild America’s image. By 2010, faced with challenges and stubbornly high unemployment, Obama’s next two years would be with a Republican House and a diminished Democratic majority in the Senate. President Donald Trump shocked everyone with his win in 2016, also to lose control of the House in the 2018 midterms. Now facing impeachment, 2020 election results are anything but certain.

Thinking back to 2010, knowing what you know now, would you have done anything differently? The Great Recession and subsequent recovery convinced us here at FirstWave Financial of the veracity of our investment approach. It was an acid test of the globally diversified, asset class investment principles we recommend at FirstWave Financial. Clients who followed this advice avoided the temptations of the high risk strategies of market timing and concentrated investing. Instead, they strategically rebalanced their portfolios to sell high and buy low during that storm, allowing them to capture market returns as they occurred.   

Uncertainties exist today as they did ten years ago, they’re just different – impeachment, elections, China, sanctions, Brexit, etc. To protect your wealth, considering these uncertainties, you might be tempted to temporarily get out of the market, or invest only in dividend paying stocks, until these uncertainties are resolved. But if you succumb to these temptations you may be putting your wealth at more risk than by maintaining an appropriate globally diversified, asset class portfolio. The market could have a significant positive move while you are out of it and you miss it entirely. Or dividend paying stock could fall out of favor, as they sometimes do. There will always be unresolved uncertainties, so they are unavoidable.  

Our recommended approach is unchanged to strategically invest your wealth in accordance with your personal investment plan that considers your need for cash flow and your ability to weather market volatility, using asset classes that give you exposure to the global capital market and a higher likelihood of a successful investment experience.  

I wish we had 20/20 vision of what 2020 holds, but we don’t. No one does and that means we must not invest using strategies that are dependent upon someone’s prediction of the future. The principles we use are designed to help you invest, protect and enjoy your wealth regardless, and sometimes despite, present circumstances.  

The FirstWaveFinancial team looks forward, with you, to the great year ahead. Find out what it might be like to have a personal WealthCoach by your side helping you make smart decisions about your money and creating the future you dream of. Call our wealth services firm in Satellite Beach, FL – Melbourne/Brevard area at (321) 773-7773 to schedule your complimentary initial consultation.

You should not assume that any discussion or information contained in this publication serves as the receipt of, or as a substitute for, personalized investment advice from FirstWave Financial. A copy of the FirstWave’s current written disclosure statement discussing our advisory services and fees is available upon request.