Rebalancing Portfolios

To our clients and associates,

You’ve heard that the most important tenet of investing is to “buy low and sell high.” This is exactly the purpose of rebalancing your portfolio, which is one of the most valuable services we provide.

As you know, the economic impact of COVID-19 has reduced equity values worldwide. Simultaneously, US Treasuries have risen dramatically. As a result, the portion of your portfolio in fixed-income investments is higher than our target for you and the equity allocation is lower than planned.

The process of rebalancing implements our discipline of selling high (bonds) and buying low (stocks). This will also provide fuel to the engine during a recovery.

You may remember the dual pie-chart report we provide during your financial reviews. The two charts show target and actual allocations of international and domestic stocks as well as fixed-income and cash positions. When these targets exceed our 5% tolerance level, it is time to rebalance your portfolio.

As we implement the rebalancing process, you will receive trade confirmations from Schwab. Please be assured that this is our way of providing support to you and is a normal part of the service we provide.

On another topic: The majority of our staff are working remotely. We are generally operational and available to handle client matters as seamlessly as possible. We continue to have access to both voicemail and email and all team members have full access to our secure systems. We remain committed to providing you with the same high level of service that we’ve been providing for the past 28 years.

In order to protect you and our staff, any office meetings that are currently scheduled will be rescheduled for a later date or changed to a teleconference.

We thank you for your patience as we all adapt to this new way of conducting business. We are confident that these conditions are temporary and look forward to returning to life as we remember it as soon as possible.

Wishing you the best!

Al Wooster

Past performance is not indicative of future performance. Loss of principal and/or loss of portfolio value are possible.