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Market Update: Strategy and What to Expect

We expect markets to continue their volatility, swinging both up and down, with uncertainty as the fuel. As data and information regarding the virus and economic conditions materialize over the coming weeks, the uncertainty will be reduced and markets will likely settle. It is difficult to predict where this will end. While we have yet to see a catalyst such as this, we are familiar with the behavior we are witnessing. We know how to navigate when the markets get spooked, jumpy, and uncertain.

Here is our current strategy:

  • Initially, we hold steady, making small asset allocation rebalances periodically to keep your account properly diversified. Active trading in volatile markets is unadvised and dangerous. Remember, you have bonds in your portfolio which give you a level of protection in markets like these.
  • As we examine global markets we will adjust your strategy to best position your portfolio for our “future markets”.  As time progresses and data materializes, it is likely we will see thematic opportunities and we will act accordingly.
  • The Federal Reserve and other global policy makers have already taken the first of many steps to stabilize monetary systems around the world. Experience tells us that these measured steps work, they take time, and more steps are likely.
  • It is highly probable that governments around the world, including the U.S., will quickly roll out economic incentive plans. This tactic was used very successfully coming out of 2001 and 2008, and this time should be no different.

The major difference between markets today and 2008, is that in 2008 it was a financial system crisis: our financial system was broken, weak, and needed repair. Today our financial system is strong, well-capitalized and up to the task.

Operations Update

We all live in this world of uncertainty and this new catalyst has many uncertainties for mankind and economies around the world.

Charter Oak is focused on delivering our high-quality, timely services and we are fully prepared to continue to serve you.

Our well-established business continuity plan has been implemented. As such, all of our employees will be working remotely, something that we have been doing seamlessly for many years. We are also doing our part in slowing the spread of this virus by temporarily postponing all our in-person meetings in favor of phone or online meetings. We will be monitoring events as they unfold, and will move back to in-person meetings when prudent.

  • We have technology which allows all of our market, trading systems, and cashiering to be fully functional.
  • All of our communication systems, phones, email and online meetings are fully functional; we can hold online meetings and share our screens easily.
  • We have the technology for digital signing on any necessary forms through our partnership with DocuSign, so nothing will go "undone."

We recognize that we all need to do our part to help each other, and with ALL of our efforts we can get through this and hopefully come out stronger, smarter, with a new lease on life.

We appreciate the opportunity and trust you have placed in our guidance. We are here to serve you and help you make the best decisions for you and your financial well-being.