April Market Review
To our clients and associates,
The Dow was up 11.08% in April. To give you an idea of how remarkable this is: it was the best April performance for the Dow since 1938.
We are now technically in a bull market, which is defined as a market that has risen 20% from its low point. In fact, this was actually reached in only 11 trading days after the bear market was declared!
“The average stock fund rose 13.5% in April according to Thomas Reuters Lipper data, to trim the year-to-date decline to 14.7%. International stocks rose 8.0% in the month to trim their year-to-date decline to 17.1%.” (Wall Street Journal 05/04/20)
Surprised? It’s completely understandable if you thought the markets went the other direction in April. News of the coronavirus, unemployment numbers and the complete disruption of our lives is enough to cause anyone to assume the worst.
As states lower their shelter-at-home restrictions, infections will most likely rise again. This will cause further disruptions and will keep our economy from fully recovering for some unknown period of time.
Nonetheless, we feel it is important to stay invested throughout these difficult times. I know I beat this drum repeatedly, but the market simply cannot be timed. After dropping 34% in 33 days, all one has to do is look at how quickly things turned around in April to realize the importance of riding this out. (Past performance is not indicative of future performance. Loss of principal and/or loss of portfolio value are possible.)
It’s also important to remember that the stock market is a leading economic indicator. This means it moves ahead of the economy’s actual improvement. Therefore, the market is likely to rise in advance of an actual turnaround in our economy.
So the key is to stay with the long term strategy that we have developed together and know that we will see a recovery and a return to life as we remember it.
All my best,
Past performance is not indicative of future performance. Loss of principal and/or loss of portfolio value are possible.