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Quarterly Client Update Q1 2021

Looking back on the past year we find ourselves amazed by resilience – of people, communities, businesses, the economy and the stock market.

A year ago, US stocks ended the first quarter down 20.9%1. If you had been told at that time that in April 2021 few employees would be going back to the office, many schools would remain closed, and reopening and stimulus would be the latest political battles, you might have been pessimistic. In fact, had you known the number of deaths and job losses the logical belief would be that this would rival the Great Depression.

We have heard from many of you regarding the hardships you have faced from health concerns to job losses along with all the other ancillary impacts of Covid-19. We don’t want to gloss over the unbelievable amount of pain and suffering these last 12-15 months have had on our clients and their families.   

We do want to highlight the resilience of businesses, which in turn leads to a resilient stock market. Restaurants were supposed to be wiped out, but many were able to quickly adjust their focus to takeout orders and managed to keep their doors open. Businesses in general have cut many physical investments in order to ramp up their digital investments2, which for many has opened up unexpected opportunity.

These changes along with the expectation of the economy continuing to reopen has resulted in stocks moving higher. Over the past year, US stocks are up 62.5%3. Market moves like this inevitably lead investors to ask when it will end (and we all know market pullbacks are common and expected in a functioning market). Investors are also looking at vaccination data and economies opening up which they see as a reason for further growth. We don’t know which theory will prove to be true, our advice remains to not let such predictions impact how you invest. We enjoy working with you to develop an investment strategy that is appropriate for your situation, regardless which way the market moves in the short-term.

Your portfolio is an important piece of your financial plan and we want you to have confidence in it. Thank you for allowing us to walk alongside you. We have started to meet with clients in our office and would enjoy seeing you again when you are comfortable.  

1Russell 3000, LPL Research Daily Performance Report 4/1/2020

2U.S. Bureau of Economic Analysis and Alger. Digital investment comprises nonresidential fixed investment of intellectual property products (software and R&D) and information processing equipment. Physical investment comprises nonresidential structures and equipment (ex-information processing).

3Russell 3000, LPL Research Daily Performance Report 4/1/2021

4Dimensional Fund Advisors Q1 2021 Quarterly Market Review


The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. All performance is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly. The economic forecasts set forth in this material may not develop as predicted and there can be no guarantee that strategies promoted will be successful. 

All investing is subject to risk, including the possible loss of the money you invest. Diversification does not ensure a profit or protect against a loss.