March 12, 2020
The purpose of this message is to provide an update from Calder & Colegrove Investment Group (CCIG) in terms of our response to the Coronavirus.
During his address to the nation last night, President Trump suspended travel between the United States and Europe. Additionally, through an abundance of caution and through the suggestions of government officials, we want to reduce the chance of so-called “community spread” of the Coronavirus. Therefore, at CCIG, we are going to implement the following steps:
Annual Client Meeting is Cancelled
Typically, in late April, we hold our annual client meeting. We have made the decision to cancel this year’s meeting in the spring. Alternatively, I will be publishing a new article – complete with thoughts on the market and all other items that I planned to address during the annual meeting. We will soon distribute these remarks through all communication methods, including email and blog. And for some clients who prefer paper, we will also compose a letter and send it through the mail.
Phone and Web Conference Calls
Through the remainder of the month of March, we are transitioning to phone and web conference calls with clients. We plan to resume in person meetings in April. But the situation with Coronavirus is fluid. If this effects any meeting that our team has already scheduled, they will contact you personally.
Stock Market Panic
The stock market is enduring a panic – there’s no other way to put it. In a span of just a few weeks, the stock market has declined nearly 25% off of its highs. Although a market correction is a normal event that we expected over time, having it occur in just a manner of a few weeks is quite a gut punch to us all.
Is it Time to Reduce Market Risk?
The panic that is temporarily dominating Wall Street is something that most of our clients, including you, do not share. Now let there be no doubt, the wild swings have certainly hurt portfolio values. But, as you can attest, we take great care to invest your money according to your tolerance for risk. And although the market performance and sensational news reporting are scary, you might be surprised to learn that most of our clients have remained invested – as is.
However, if you are wondering: “Should we make changes?” I promise, you’re not alone. To help, I recommend that we take this opportunity to review your risk tolerance. Here’s a suggested course of action:
We think this is a mature way to potentially make changes or to recognize that no changes are required. My goal has always been to make sure your risk is personalized and appropriate. That way, the investment decision-matrix is somewhat removed from the unpredictable short-term swings of the stock market.
If you are curious to see how the risk score of your quiz may translate to portfolio risk, take a look at the chart below.
|Risk Score||Investment Objective||Equities (Risk)||Bonds/Cash (Fixed)|
|40-59||Growth with Income||60%||40%|
|20-39||Income with Moderate Growth||40%||60%|
|1-19||Income with Capital Preservation||25%||75%|
As always, we are here to serve. You may also be encouraged to recognize, that this virus is something that will pass. I’m hoping that a good dose of HotLanta weather, will help spell doom for Coronavirus, so we can get back to our daily routines.
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